Grocery sales rise as inflation slows

NIQ’s Total Till data has revealed that shoppers spent more in the last four weeks (£20.10) compared to the same period last year (£19.50), as total till sales at UK supermarkets grew (+5.4%) in the last four weeks ending 23 March 2024.

This is a slight increase compared to the growth (+5.3%) reported last month, while the drop in food inflation (3.7%) compared to 15% a year ago has encouraged shoppers to buy more. Visits to stores increased by 1.1% in the last four weeks, compared to the same period a year ago.

Meanwhile, in a sign that consumers are still searching for deals, spend on promotional items accounted for almost a quarter (24%) of FMCG sales compared to 20% a year ago.

Mother’s Day discounts were popular as supermarket sales increased (+11.9%) during the week ending 9 March, while the same occasion saw dining in as a popular option for many shoppers. There was an uplift in sales for produce (+8.5%) and meat, fish & poultry (+8.4%).

Lower food inflation saw below-inflation growth for a number of goods, including packaged grocery (+3.5%), frozen (+3.1%), delicatessen (+3.0%), beers, wine and spirits (+2.7%), bakery (+2.4%) and dairy (+1.8%).  

Frozen goods grocer Iceland saw no change in growth in the 12 weeks to 23 March 2024, compared to the same period a year ago, while the Co-op saw a 0.1% boost from 4% to 4.1% in the same period. Tesco maintained the largest share of sales across the periods.

Mike Watkins, NIQ’s UK head of retailer and business insight, said: “As inflation slows, we have seen an improvement in grocery sales volumes during Q1. A driver of this was the further fall in food prices in March, together with intense competition amongst the supermarkets looking to drive footfall with promotional offers as seen on Mother’s Day and in the weeks leading up to Easter. However, overall consumer spend remains under pressure as many household bills continue to increase above CPI and this is reflected in the continued weak consumer confidence.

 “Encouraging more visits is likely to be the next battleground for retailers now that we have lower inflation. The wet and cold weather in the first quarter of the year may have  deterred some store visits, but we saw that the early Easter offered some attractive seasonal promotions which encouraged shoppers to buy more. When drier, warmer spring weather eventually arrives this will continue to support volume growths across all channels.”

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