J Sainsbury PLC (LON:SBRY) continued to lag behind the rest of Britain’s big four supermarkets in the 12 weeks to 24 February, industry data has revealed.
Kantar Worldpanel said sales at Sainsbury’s, which is in the process of trying to buy Asda, dropped 1.0% in the period.
READ: Sainsbury's plunges as UK regulators leaning towards blocking £10bn Asda merger
It was the only big four supermarkets to post a decline with Tesco PLC (LON:TSCO) sales up 1.3%, Asda up 1.0% and WM Morrison Supermarkets PLC (LON:MRW) up 0.8%.
Sainsbury’s and Asda are awaiting the final ruling from the Competition and Markets Authority on the supermarkets’ proposed £10bn merger.
Last month provisional findings from the CMA’s investigation into the deal suggested the merger could lead to a “worse experience” for shoppers both in-store and online.
One of the major concerns was that food and petrol prices could rise, while the number of product ranges offered could reduce.
The CMA found that any deal could lead to a “substantial lessening of competition”, especially in areas where Sainsbury’s and Asda stores overlap.
Supermarkets continue to lose market share to discounters
According to the latest Kantar figures, the Sainsbury’s and Asda would have a 31.2% share of the market if the tie-up is approved, overtaking current leader Tesco.
In the latest 12-week period, Sainsbury’s market share fell by 0.5 percentage points to 15.7% while Asda dipped 0.1 point to 15.5%.
READ: Sainsbury's, Tesco, Morrisons and Asda lose market share to discounters over Christmas and New Year
Tesco’s market shares fell by 0.2 percentage points to 27.7% and Morrisons lost 0.1 point to 10.7%
The UK’s biggest supermarkets have been losing ground to German discounters Aldi and Lidl for some time now.
Aldi delivered a 10% rise in sales over the 12 weeks and its market share increased 0.6 percentage points to 7.6%.
Lidl sales gained 5.4% with market share rising 0.1 percentage points to 5.2%.
Amazon could become bigger threat to supermarket sector
Supermarkets are also facing the threat of Amazon.com Inc (NASDAQ:AMZN) bringing its cashier-less Amazon Go convenience stores to the UK for the first time.
“If the online giant does make a move into British bricks and mortar, it certainly makes sense to look in the capital in the first instance,” said Fraser McKevitt, head of retail and consumer insight at Kantar.
“The London convenience store market is worth £1.4 bn annually in take-home groceries alone and the current rate of growth is 13%.
“Amazon already has an established customer base in the region, with 10% of its current FMCG shoppers living within the M25 and a further 25% in the South of England.”