Supermarket giant Tesco suffers worst sales decline in 20 years

PUBLISHED: 15:38 29 July 2014 | UPDATED: 15:38 29 July 2014

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Britain’s largest supermarket Tesco has suffered its worst sales decline in at least two decades, while discount rivals achieve more record trade, according to figures.

Tesco’s sales fell 3.8pc, according to the latest till-roll figures from Kantar Worldpanel, the steepest decline since it began comparable records in 1994, as the chain’s market share fell to 28.9pc from 30.3pc a year ago.

Big four rival Morrisons also saw its sales fall 3.8pc in the 12 weeks ended July 20, leading its market share to slip to 11pc from 11.5pc, as low industry inflation kept sector growth to a 10-year low.

But discount supermarkets Aldi and Lidl made record sales as price competition in the sector weighed heaviest on the country’s big four players.

Sales at German discounter Aldi rocketed 32pc over the year taking its market share to a record 4.8pc, just behind upmarket Waitrose.

Rival German low cost business Lidl saw its sales leap 19.5pc, which kept the firm’s market share at its record level of 3.6pc.

Sainsbury’s sales grew 1.2pc to maintain its market share at 16.6pc, while Asda grew 0.9pc, which kept its market share at 17pc.

Frozen food supermarket Iceland saw its sales dip 0.3pc over the period, its first fall since 2005, though its market share remained at 2pc.

The Kantar data also showed that grocery price inflation fell for the tenth quarter in a row to 0.4pc, due to price competition and the deflation of staples such as vegetables, milk and bread.

The research body said inflation in the sector was at the lowest level since October 2006.

Low levels of inflation left industry growth at just 0.9pc, the lowest level for a decade.

Last week Tesco ousted chief executive Phil Clarke and announced its second profit warning in two years after it said trading was “more challenging than we anticipated”.

Mr Clarke will be replaced by Unilever executive Dave Lewis on October 1.

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