Sainsbury’s is taking a bite out of its rivals: we are pushing down turnover, says the boss
The boss of Sainsbury’s says it is ‘taking business from our competitors’ after a 3.4 per cent increase in annual turnover to £36 billion.
Simon Roberts said the country’s second-largest supermarket is cutting off customers from discounters Aldi and Lidl, as well as more expensive rivals.
He said the grocery business was “firing on all cylinders” as a strategy to “put food back at the heart” of the group was paying off.
Food sales increased by 7.3 percent in the fourth quarter and by 9.4 percent for the full year. However, other areas lagged behind.
Higher grocery sales helped profits rise 1.6 per cent to £701 million for the year to March 2.
Growth: Sainsbury’s said the return of staff to offices has boosted business as annual sales rose 3.4% to £36 billion
Roberts added: ‘We have the best combination of value and quality and that wins us customers out of all our major competitors.’
There is fierce competition among grocers as households struggle with cost-of-living pressures.
But Sainsbury’s said an Aldi price match campaign has helped it lure customers back from the German discounter, which has seen its sales momentum slow in recent weeks.
The staff returning to work in the office also contributed to an increase in store turnover.
It’s another boost after industry data this week showed Sainsbury’s a star performer alongside top grocer Tesco.
Food focus: Boss Simon Roberts said Sainsbury’s was taking away shoppers from all its rivals
Kantar said its share of the market rose from 14.9 percent to 15.3 percent in the 12 weeks to April 14, compared with the same period a year earlier.
However, yesterday’s results showed a disappointing performance for clothing, with sales down 6.4 percent.
Sales of general merchandise, including Argos, fell 0.5 percent.
This is because the chain is going to renovate stores to give groceries more space.
Meanwhile, in a development that threatened to overshadow the results, customers were left furious after online orders were canceled yesterday due to technical problems.
Investors were unimpressed by Sainsbury’s update and the shares fell 4.3 per cent, or 11.4p, to 256.6p.
Retail analyst Nick Bubb said Sainsbury’s food first strategy “appears to be paying off, but the company will need to find a way to improve its performance in the non-food sector”.