Tuesday 20 August 2019

Tesco still on top in 'fierce' grocery war with rivals

Scorcher: Heatwave boosted sales for grocery retailers
Scorcher: Heatwave boosted sales for grocery retailers
John Mulligan

John Mulligan

Tesco remains the country's biggest grocery retailer, seeing off continuing competition from SuperValu and Dunnes Stores.

The data from research group Kantar Worldpanel Ireland highlighted the impact of this year's hot summer, with branded sales of alcohol, soft drinks and frozen desserts producing an extra €29m of year-on-year sales for retailers in the 12 weeks to September 9.

SuperValu also took a lead on alcohol sales during the summer according to Kantar Worldpanel, overtaking Tesco and capturing 26pc of shopper spend in the category.

Tesco had a 22.1pc share of the grocery market in Ireland by value of sales during the latest period, marking the sixth consecutive period it has held on to top spot.

SuperValu, the chain controlled by Cork-based retailer Musgrave, had a 21.7pc share. Dunnes Stores was close behind with a 21.6pc share.

Musgrave and Dunnes Stores battled to buy upmarket Dublin grocery retailer Donnybrook Fair recently, with Musgrave emerging victorious last week. It has agreed to buy Donnybrook Fair in a deal worth up to €25m.

Musgrave plans to roll the brand across its network and may convert some Centra outlets into Donnybrook Fair stores.

Dunnes Stores has acquired other businesses to beef up its premium product offering for customers. In 2016, the chain bought artisan butcher James Whelan and is rolling out the brand across its network as it upgrades stores.

David Berry, a director at Kantar Worldpanel, said intense competition among grocery retailers in Ireland is paying dividends for consumers, with lower prices for food and drink.

The latest data shows the Irish grocery market was in deflation again during the latest 12-month period, with prices falling 0.2pc.

The back-to-school rush also provided a boost for retailers.

"Cereals, cereal bars, chocolate and cheese have all had double-digit uplifts in growth in the past month, to the tune of an additional €7m being spent in the month to August compared with July," said Mr Berry.

He added that competition in the grocery sector has "rarely been fiercer".

"All the major retailers are in growth once again this period, and it's almost neck-and-neck in the race for market share," he said, pointing out that only half a percentage point separates the leading three retailers.

He said Dunnes Stores saw its sales growth rise 3.2pc in the most recent period, which was higher than the 1.9pc growth rate achieved in the previous 12-week period.

It was helped by its 'round euro' initiative, where it offers fixed, round-number prices.

"More than 20pc of sales at Dunnes Stores are at round euro price points and this has encouraged shoppers to add an extra item to their baskets each time they visit - worth a total of €18.5m over the past 12 weeks," said Mr Berry.

German discounters Aldi and Lidl continued to command solid shares of the market.

Lidl had an 11.8pc share in the latest 12-week period, and saw a 3pc rise in the value of its sales.

Aldi had an 11.6pc share, which represented a 2.9pc increase in the value of its sales.

Both Lidl and Aldi have significant shares of the Irish grocery market in terms of volume rather than value.

Irish Independent

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