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Grocery Retailers in the United Kingdom

UK grocery retailers market: £160 billion industry in 2012

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2014-02-20 21:55:02 - Grocery Retailers in the United Kingdom - a new market research report on

Tesco remains the top player in the UK grocery retailers market, with a 24% value share in 2012. However, 2012 was the first year in which Tesco lost value share following an unimpeded run to the top of the chain of grocery retailers. At some point, this was expected as the competition from the others caught up with the market leader. Tesco remains the outright leader with a ten percentage point lead over its next competitor Asda. To some extent, therefore, Tesco has struggled from market saturation. There has also been some negative media coverage for the company surrounding its aggressive planning strategy, and its attitude to other local retailers.

The largest growing category in grocery retailing is discounters which registered



growth of 9% in current value terms in 2012. Although not as large a channel as convenience stores and supermarkets, this burst of growth has clearly come from the economic downturn with consumers now prioritising cost and value over anything else. Discounters have been expanding as intensely as the major supermarket chains buoyed by the growing demand. Hard discounters, such as Aldi and Lidl, mostly concentrate on price promotions, but are also beginning to add terms, such as "fresh meat" and "fresh fruit and vegetables" to their marketing campaigns in the UK.

Over the forecast period convenience stores is expected to see the strongest and fastest constant value CAGR of 4% to 2017. As the top grocery chains in the UK are moving into convenience stores at a high rate, it is expected that this channel will see strong growth in the medium term. Convenience stores appeal to many consumers due to their location, price points and reduced wastage. The push of the "Big Four" to churn out convenience stores is in line with the mentality of current and future shoppers of "top-up shopping". This shopping style is seen as buying a few items every day or every other day, or as and when needed. This "top-up shopping" is in direct response to the rising concerns over food wastage.

Key Headlines

- Sales of grocery retailers increase by 4% in 2012 to reach £159.4 billion
- Discounters achieves the strongest growth up 9% in value terms in 2012
- The number of outlets declines by 1% in 2012 as independent stores close and consolidate
- Tesco remains the leading grocery retailer with a 24% share in 2012
- Grocery retailers is expected to increase by a CAGR of 2% in constant value terms to 2017.

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