British supermarkets may well have put an end to their steady downward spiral, according to the latest grocery share figures from Kantar Worldpanel.

For the 12 weeks ending 28 February 2016, supermarkets saw small increase in supermarket sales, up by 0.5 percent compared with a year ago. Whilst a relatively minimal rise in comparison to the problems the market has been experiencing over the last year, it remains the fastest rate of growth since October 2015. However, falling grocery prices remain a problem for the chain, down 1.6 percent. Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, commented on the figures:

“Despite prices continuing to decline, the combination of Valentine’s Day, and consumers stocking up for an early Easter has boosted certain categories. February chocolate sales are up by 13 percent, cut flowers have increased by 7 percent, and sparkling wine sales are up by 15 percent. New Year resolutions to eat more healthily don’t seem to have been forgotten, helping fruit and vegetable revenues to grow by 4 percent despite like-for-like produce prices falling.”

Individually, Sainsbury’s was the winner again, becoming the only one of the Big Four to increase overall spend. Sales grew for the eighth period in a row, up by 0.5 percent – this is the longest run of sales growth for any of the four main retailers since March 2013. However, overall share remained flat at 16.8 percent.

Tesco also continued to see positive figures, improving on last month’s 1.6 percent decline with a decline of 0.8 percent. A renewed focus on price promotions has helped stem the flow of shoppers leaving the retailer despite the closure of around 50 stores in the last year.

However, Morrisons in-store sales remain disappointing – down by 3.2 percent due to operating fewer stores than last year. This is partially offset by a strong growth in online sales, with its forthcoming tie-up with Amazon possibly provide another boost to the business. Discounters Aldi and Lidl continue to offer a challenge to the Big Four, with their combined share climbing back to the 10 percent high they reached before Christmas. Lidl’s sales grew by 18.9 percent and Aldi’s by 15.1 percent.

Tesco (LON:TSCO) shares are higher this morning at 193.75, with Morrisons (LON:MRW) down 2.67 percent at 206.60.

Miranda Wadham on 08/03/2016