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The Markets
by Proactive
Proactive UK has moved.
Coverage of London’s small caps continues on proactiveinvestors.com
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The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK
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The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK

Retail

Supermarkets to see fewer ‘big shops’ as people return to offices, cook less at home

Experts reckon the shift to pre-pandemic habits will be gradual

Grocery shopping habits are changing again now that people are returning to the office and to school and generally spending more time outside of the house, according to new industry data.

The single weekly big shop, encouraged by the government throughout the lockdown, will progressively be abandoned in favour of more frequent top-up buying, predicted Kantar in its monthly update of supermarket till takings.

READ: Ocado sees first sales dip as shoppers continue return to pre-pandemic habits

Baskets are also smaller on digital platforms, with the average online shop now worth £78.28, nearly £17 less than its peak at the start of the pandemic.

There are also signs of fatigue when it comes to home cooking, with sales of chilled ready meals increasing by 11% during the 12 weeks to 5 September.

In the same period, total UK grocery sales fell by 1.9% compared to last year, according to data from Kantar, though they are still 8.7% above pre-pandemic levels.

“We shouldn’t expect to shift from habits learned in lockdown straight back to pre-COVID patterns overnight,” said Fraser McKevitt, head of retail and consumer insight at the data analytics group.

“More people returning to towns and cities should also provide a boost for cafés and coffee shops, where spending last September was £187mln lower than in 2019. We anticipate that a good amount of that lost cash should return to the high street this year but that means it will move away from the grocery sector.”

Even though total market sales are contracting, Waitrose bucked the trend and found growth both online and in-store. With spend up by 2.2% in the past 12 weeks, it was the fastest-growing supermarket for the second month in a row.

Market leader Tesco PLC (LSE:TSCO) was the only other grocer to increase sales value year-on-year, up 0.2% on 2020, with number-two Sainsbury's sales falling 1.6%, Asda down 2.8% and soon-to-be-private Wm Morrison Supermarkets PLC (LSE:MRW) tumbling 4.9%.

Discounters Aldi and Lidl grew their market share to 8.1% and 6.1% respectively, though Iceland fell to 2.3%.

Ocado Retail, the online joint venture between Ocado Group PLC (LSE:OCDO) and Marks and Spencer Group PLC (LSE:MKS), followed the online trend, falling by 1.5% compared with a year ago. However, its market share remains at 1.8%, the same as it has been since May.

Shares in Tesco were flat at 256.8p, Ocado shed 3% to 1,837.5p on Tuesday morning as it also posted a trading statement, while Sainsbury's rose slightly and Morrisons fell slightly.

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