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Brexit-effect not felt by supermarkets (yet) but growth remains sluggish

British supermarkets have not felt the impact of the EU referendum result, but the sector is continuing to experience slow growth with sales overall up just one per cent on last year. Instead, it was England’s poor performance in the Euros (and sub-par summer weather) which has been causing grocery bosses the biggest headaches this quarter.

It’s the first grocery share figures to be released by Kantar Worldpanel since the decision to Leave the EU was made. The research firm said that there has been “no immediate impact” on how much retailers are charging for goods, or how much consumers are buying. But, it remains to be seen how long this lasts and if the supermarkets can keep their prices as low as they have been over the past year.

The effect of Euro 2016 championships proved to be a mixed bag. While beer and lager sales mustered a 2.8 per cent growth ahead of the market, this was undoubtedly hindered by England’s early exit.

Once again, it was Asda that suffered the biggest blow to sales. Newly installed Asda chief executive Sean Clarke has been met with a 5.6 per cent fall in sales and an equally declining share of the market, which is now down to 15.5 per cent.

The performance calls into question its continued (and heavy) use of price-promotion tactics. Asda the only one of the Big Four retailers which has increased the proportion of sales made on promotion compared with last year. However, Kantar found that the absolute level of sales sold on a deal remains behind its competitors, with promotions only accounting for 45.2 per cent of sales.

Meanwhile Sainsbury’s – which this year pledged to remove all multi-buy offers from its shelves in favour of lower prices across the board – noted a sales fall of 1.1 per cent, taking market share down by 0.2 percentage points to 16.3 per cent.

Tesco has continued to see its sales losses stem, down just 0.7 per cent for the quarter. Its market share is also down by just 0.2 percentage points to 28.3 per cent of the market – the slowest rate of share loss since March 2014.

Finally, Morrisons saw sales drop by 1.8 per cent (still, its best results since January this year) while overall market share fell by 0.2 percentage points to 10.7 per cent.

Among the better performers were Iceland, where sales continued to grow 2.8 per cent year-on-year and the Co-op which increased sales by 2.1 per cent. Waitrose also upped its sales by 1.6 per cent. And the discounters continued to see their growth continue.

There has been a five per cent increase in the number of shoppers visiting either Lidl or Aldi this period, helping both to record a market share high of 4.5 per cent and 6.2 per cent respectively.