Good news for UK households as inflation falls to record low

The latest grocery share figures from Kantar Worldpanel, published today for the 12 weeks ending 22 June 2014, show market growth bouncing back to 2.8% from last period’s historic low of 1.7%. Compared with our measure of inflation which stands at just 0.8%, this indicates real volume growth.*

Fraser McKevitt, consumer insight consultant at Kantar Worldpanel, explains: “The low grocery price inflation this period will be welcome news for household budgets. The outlook is positive as we predict continuing sub 1% levels into the near future, providing some relief for cash-strapped consumers.

“Aldi and Lidl continue their stellar growth streaks, holding their all-time record shares reached last period of 4.7% and 3.6% respectively. Both retailers have recently announced impressive expansion plans. Aldi will aim to double its store numbers to 1,000 by 2021, while Lidl is seeking to boost its presence with an eventual total of 1,500 outlets.”

Looking outside of the big four, Waitrose and Farmfoods are both continuing to perform strongly with the latter growing ahead of the market at 23.3%. Iceland held its 2.0% market share in line with last year.

Fraser continues: “There are mixed fortunes for the big four with Tesco and Morrisons registering falls in both share and sales. By contrast, both Asda and Sainsbury’s have increased share, beating the market average with growth rates of 3.6% and 3.0% respectively.”

* Please note that the current period includes Easter 2014 whereas the comparative 2013 period does not.

An update on inflation
Grocery inflation has shown its ninth successive fall and now stands at 0.8%** for the 12 week period ending 22 June 2014. This is the lowest level in our dataset which began in October 2006 and reflects the impact of Aldi and Lidl and the market’s competitive response as well as deflation in some categories including vegetables and milk.