M&S Surpasses Food & Drink Market Share Of Co-op

M&S has become the seventh-biggest retailer of food and drink products in the UK after overtaking Co-op.

According to unpublished Worldpanel data seen by trade publication The Grocer, M&S’s food and drink market share was 5.1% over the 52 weeks to 13 July, compared with Co-op’s 4.7%. In the previous 52-week period, Co-op had a higher share of 4.9% compared to M&S’s 4.7%.

The report noted that M&S’s food and drink sales have grown by 11.5% year-on-year, while Co-op’s were unchanged.

The Grocer’s report noted that the food and drink market share data, which is distributed privately to retailers, includes sales of fresh, chilled and ambient groceries but not alcohol, household, toiletries or healthcare. It is different to the grocery market share data published monthly by Worldpanel – formerly Kantar – which relates to all expenditure through store tills (excl. petrol and in-store concessions).

The monthly published data also do not include market share figures for M&S, as it falls outside the research group’s definition of a grocer due to its clothing & home business.

Despite a recent cyberattack impacting its operations, M&S has also increased its lead over Waitrose in food and drink sales. The report stated that Waitrose’s share was 4.5% in the 52 weeks to 13 July, meaning M&S’s lead has grown from 0.3 percentage points to 0.6 percentage points over the last year.

Co-op told The Grocer that it regards Worldpanel’s take-home methodology as an incomplete gauge of its performance, arguing it ignores a large chunk of its sales as a convenience retailer.

A Co-op spokesperson is quoted as saying: “We are proud to be the leading UK convenience retailer, not a supermarket, with a market share 12.7%, as reported by Circana, who measure all convenience categories, whilst Kantar [Worldpanel] excludes circa 30% of our sales, including many food and drink categories such as food to go, confectionery and soft drinks.

“We continue to grow ahead of the convenience market and also hold nearly 25% of the UK quick commerce market.”

A Worldpanel spokesperson commented: “We do not publish retailer market share data for select categories. Our grocery market share release provides a full view of grocers’ performance, including all expenditure through store tills except petrol and in-store concessions.”

Earlier this month, the same food and drink data put Lidl ahead of Morrisons for the first time.

NamNews Implications:

• As always, market share ranking, however cut… 
• …will have an impact that is psychological and will differ by audience.
• i.e. uplifting for M&S….
• …troubling for Co-op.
• Meanwhile, food & drinks markets are in a state of flux...
• ...wherever you stand.

Asda’s New Supplier Portal Plagued By Problems

Following reports this week that Asda is close to completing its £1bn Project Future IT separation from Walmart, it has now been revealed that food and drink manufacturers are complaining about problems with the supermarket’s new supplier portal.

According to trade publication The Grocer, Asda is in the process of speaking to groups of suppliers to try to tackle issues with the new system, with one supplier describing the situation as “an utter mess”.

The report stated that major problems have been reported with Asda’s transition to its new ADR system, which is used by suppliers for forecasting, sales data, and stock control issues. This system has been introduced to replace Walmart’s Retail Link system.

Former Asda buyer Mervyn Jones, who runs a consultancy supporting companies on how to use new systems, said that the transition from a system buyers knew “inside out” to Asda’s new system was beset with problems.

“ADR is so bad I don’t know where to start with it,” Jones posted on LinkedIn. “I have a number of contacts within Asda. Some of them are telling me not to use Retail Link anymore and to move completely across to ADR. ADR, however, says to use Retail Link for historical data.

“Other contacts in Asda say to continue using Retail Link for forecasting and that ADR’s data is incomplete. It’s a mess. A complete and utter mess, and the training Asda is offering online is not up to scratch.”

Another source quoted by The Grocer said: “Moving to a new system at the same time as Asda is going through other major changes as a business was always a recipe for complexity.

Suppliers rely on these systems for key information on stock movements, waste and stock control, and historically, Asda’s system has been top of the tree.

“That’s not the case anymore, and suppliers are not getting the same speed of information. Data on products they use to get at the start of the day is now coming much later.

“To Asda’s credit, they are being transparent about these problems and talking to suppliers to try to tackle these issues, but at the moment, it is causing a lot of issues.”

The report noted that Asda was engaging with suppliers as they transitioned from Retail Link to the new supplier portal.

A company source told The Grocer that Asda had expected a “period of adjustment” and was actively working with suppliers to ensure they were supported throughout this period, including offering training and guidance materials.

NamNews Implications:

• Already in a race against the clock.
• Asda could have done without ‘teething troubles’ associated with a £1bn IT conversion project..
• At a time when willing suppliers are trying hard to lend support to a key retail player…
• Whose rival retailers present increasingly appealing trade investment opportunities..
• These unprecedented times tick on remorselessly…
• ...fast leaving Asda with the option of going for broke, regardless.

Bank Of England Expects Food Inflation To Hit 5.5% This Year

After cutting interest rates yesterday, the Bank of England warned that climbing food prices will cause inflation to surge even higher in 2025.Economists at the Bank blamed rising food prices on several factors, including changes to packaging regulations and increased labour costs, as a higher proportion of workers in the retail sector are paid the national living wage, which the Chancellor Rachel Reeves increased by 6.7% in April.

They also blamed higher employment taxes announced in the Autumn Budget, saying: “Furthermore, overall labour costs of supermarkets are likely to have been disproportionately affected by the lower threshold at which employers start paying NICs… these material increases in labour costs are likely to have pushed up food prices.”

Responding to the Bank of England’s comments, Helen Dickinson, Chief Executive at the British Retail Consortium, said: “The Bank of England report outlines how the last Budget continues to push up food prices.

Government policy will add £7bn to retailer costs this year, from higher employment costs to the introduction of a new packaging tax. Food prices have already been climbing steadily, and the BRC has warned this is only the beginning, food inflation means poorer families being hit the hardest by the Treasury’s decisions.

“While retailers are doing everything they can to shield their customers from rising prices, their ability to absorb further costs is extremely limited. If government goes ahead with its planned higher business rates threshold for 4,000 larger stores – including many supermarkets – then it will be ordinary households who suffer the most.”

Food and Drink Federation (FDF) Chief Executive, Karen Betts, added: “Food and drink inflation is rising noticeably again and currently this shows no signs of easing.

Global energy and commodity prices are rising once more, and this comes on top of new taxes and regulatory costs, like higher employer National Insurance Contributions and this year’s new packaging tax.

Food and drink manufacturers try to absorb as many of these costs as possible to protect shoppers, but the fact is that making food and drink in the UK is more and more expensive to do.

“It’s critical that government takes decisive action to cut red tape and promote growth and investment across the food and drink sector, including ensuring there are no further cost increases to businesses in our sector in the autumn Budget.”

NamNews Implications:

• Meanwhile, consumers are driven by perceived inflation…
• …especially for food.
• (and more government-caused cost increases in the pipeline)
• A perception that it is more than the official stats.
• Anyone in real doubt, try doing the household shopping, alone for a few months…
• ...and study the actions of fellow shoppers.
• Anticipate increased switching to own-label equivalents and discounters.

Asda Launching New Customer Insight Platform That Supports Evolution Of E-Commerce Category Management

Asda is preparing to launch a new customer insight and collaboration platform, created in partnership with eStoreBrands, an e-commerce data analytics specialist.

According to trade publication Retail Week, Asda Xpert will launch next week with the aim of helping the supermarket group and its suppliers “understand and more effectively meet the needs of its online shoppers”.

A source is quoted as saying that the new platform will provide brands with “advanced data-driven insights, enabling them to optimise product performance, track market trends, and make smarter category decisions for Asda.com”.

The new platform will also “integrate digital shelf analytics and real-time performance data” in order to help “suppliers drive mutual category growth and improve decision-making”.

It is claimed that Asda Xpert will be a major step forward in the “evolution of e-commerce category management” and will provide brands with the tools they need to “maximise growth, optimise strategies, and better serve customers in an increasingly competitive online retail space”.

Barney Burgess, Asda’s VP of Online, told Retail Week: “We’re really excited about this new partnership between Asda and eStoreBrands. Leveraging an e-category management approach, Asda Xpert will enable brands to identify new insights from our data, driving more informed actions which will accelerate growth for the brands as well as Asda.com”.

eStoreBrands’ VP of product strategy, Francis Nicholas, added: “Having spent years working for brands like P&G and Nomad Foods, I know first-hand how valuable this kind of insight is.

When working with retailer buying, category, and ecommerce teams, this was the type of solution which was missing. Partnering with Asda on Asda Xpert is incredibly exciting, and we look forward to supporting brands in making data-led decisions that benefit both suppliers and Asda.”

NamNews Implications:

• Asda are patently pressing all the right buttons.
• And innovating with leading-edge tools.
• The key issue remains that of sufficient EBITDA improvement…
• …fast enough to beat the clock.
• Fingers crossed.

Sainsbury’s Shakes Up Management Team

Sainsbury’s has made new appointments and reshuffled its existing leadership team to support the delivery of the group’s ‘Next Level’ strategy.

Tracey Clements will join the retailer at the beginning of September in the role of Chief Retail, Logistics and Supply Officer. The newly created position unifies Sainsbury’s Retail, Digital, Customer Experience, Supply Chain and Logistics activities under a single leadership.

Clements’ past experience includes 17 years with Tesco, where she held a number of leadership roles, including Store Director, Managing Director of Tesco Express, and CEO of One Stop. She then became Chief Operating Officer for Boots UK & Ireland, and most recently, was Senior VP of Mobility and Convenience Europe at petrol forecourt operator BP.

Meanwhile, accountability for Technology at Sainsbury’s is moving to Mark Given following the recent departure of its Chief Retail and Technology Officer, Clodagh Moriarty, to homewares chain Dunelm.

Given will become Chief Technology, Marketing and Data Officer from 1st September, supporting Sainsbury’s drive to utilise technology and AI in delivering “outstanding customer experience, leveraging the power of data and insight and unlocking future opportunities at scale.”

Rob Barnes will join Sainsbury’s in early October as Chief Technology Officer, reporting to Given. Barnes left Asda in April, having supported the group’s ‘Project Future’ IT separation from its previous owner, Walmart.

Sainsbury’s also confirmed that Rhian Bartlett will become its Chief Commercial and Sustainability Officer in an expanded role, bringing together the group’s commercial and sustainability agendas under a single leadership. The retailer stated that by aligning commercial and sustainability leadership, it was “embedding sustainability at the heart of commercial decision making – ensuring both areas come together to support long-term value creation and environmental leadership.”

Meanwhile, Graham Biggart has been appointed Managing Director for Argos and Chief Strategy Officer. The move will see the chain’s retail and transformation teams report directly into Biggart, enabling an “even sharper focus on delivering the More Argos, more often transformation plan and accelerating Argos’ growth”.

Biggart will continue to hold accountability for shaping the group’s future strategy, whilst his prior responsibilities for Sainsbury’s supply chain and logistics will transition to Clements to align more closely with its retail operations and customer experience.

“I’m delighted to welcome Tracey to our Operating Board. Her breadth of experience, energy and customer-first mindset make her an outstanding addition to our leadership team, and I’m confident she will play a pivotal role in accelerating our plan and shaping the next chapter of our Sainsbury’s business,” commented Chief Executive Simon Roberts.

“Alongside Tracey, we’re strengthening our leadership across Technology, Commercial and Sustainability, all areas that are critical to delivering our Next Level strategy. With Rhian taking forward our combined commercial and sustainability ambition, Mark uniting technology, marketing and data, Graham leading our group strategy and the transformation of Argos, and Rob joining us as CTO, we’re building the momentum and the capabilities to move faster, serve customers better and unlock long-term growth across the group.”

Last month, Sainsbury’s reported better-than-expected first quarter sales, benefiting from warm weather and a disruption at rival Marks & Spencer. Its shares are up 8% so far this year.

NAM Implications:

• Anyone close to Sainsbury’s knows that these are fundamental changes and enhancements to Sainsbury’s ability to accelerate future growth in an unprecedented retail environment…
• …with potential rewards for suppliers that align with the retailer’s enhanced team.
• i.e. time to reconfigure supplier-retailer networks.
• Starting from where new and current team members have been…
• …and anticipating their thinking going forward.

Aldi To Open One New Store Every Week For The Rest Of The Year

Aldi has revealed that it will be opening an average of one new store a week in the UK between now and the end of 2025

New store locations opening in the coming months include:

• Airfields, Welsh Road, Deeside
• Rockingham Road, Market Harborough, Leicestershire
• Fulham Broadway, London
• Pacific Drive, Eastbourne, East Sussex
• Mafon Road, Nelson, Treharris
• Ashford, Waterbrook, Kent
• Commercial Street, Shoreditch, London
• Philadelphia Lane, Houghton le Spring, Tyne and Wear
• Mill Road, Meadowfield, Durham
• Pendle Drive, Litherland, Liverpool
• Ringwood Road, Brimington, Chesterfield

The discounter is investing around £650m across Britain in its store opening and refurbishment programme for 2025.

“At Aldi, our goal is to make sure people across the UK have access to affordable, high-quality food, and opening new stores is key to making that happen,” said Jonathan Neale, Managing Director of National Real Estate at Aldi UK.

“We’re now opening an average of one new store a week for the rest of 2025, showing just how ambitious our plans are to build a store network that will help us reach millions of new customers.

But it’s not just about openings – it’s also about making sure we have the best-paid teams in place to run them.”

At the end of last month, Aldi revealed that it was set to become the first supermarket in the UK to pay store staff at least £13.00 an hour as it steps up its recruitment drive to support its expansion plans.

NamNews Implications:

• That’s 20 new stores in anyone’s language…
• …for a discounter growing sales and market share.
• Time for suppliers in many categories to question whether they are doing enough to access and maintain their fair share of Aldi business, going forward...
• Worth a look?

Asda Closing In On Major Property Deal That Will Boost Recovery Funds

Asda is reported to be in advanced talks about a £400m deal to offload some of its real estate assets to an investment house to help fund its turnaround plans.

According to Sky News, Blue Owl Capital, a New York-listed asset management group, has emerged as the frontrunner to buy roughly 20 Asda supermarkets and lease them back to the struggling retailer. Sources indicated that a deal could be formally agreed upon within weeks.

Asda has undertaken sale & leaseback deals in the past, notably in 2023 when it struck a £650m deal with US-based Realty Inc.

A spokesperson for the retailer declined to comment on the talks with Blue Owl Capital but said: “Sale & leaseback [transactions] have been a feature of the retail industry for many years.

“While maintaining a strong freehold base remains central to Asda’s property strategy, we will consider suitable opportunities to unlock value from our property portfolio as part of our material programme of investment into the business.”

While sales at Asda are still in decline, recent industry data suggests that there are signs of recovery after significant investment in cutting prices and improving its offering.

NamNews Implications:

• Sale & leaseback represents a capital gain for a struggling business.
• But it can add an additional rent burden…
• Asda need the money but is obviously intent on keeping sale & leaseback to a minimum.
• (keeping in mind an exit strategy that will optimise the ‘eventual’ sale/refloat of the business)
• Meanwhile, fingers crossed…

Supermarket Price War Impacting Profits At Iceland

Intense price competition in the supermarket sector is impacting profit growth at frozen food specialist Iceland.

According to The Telegraph, the retailer has recently informed bondholders that its underlying profits increased by only 0.6% to £317.6m in the year to the end of March 2025, compared to a 24% rise in the prior year.

Revenues were largely flat at £4.2bn, although its previous financial year – when sales rose 6.6% – was boosted by an additional trading week. On a comparative 52-week basis, sales were up 3% this year.

The report noted that the profit slowdown follows Iceland pushing to keep prices lower as supermarkets battle to attract cash-strapped shoppers.
Iceland has been stepping up its programme of multibuy promotions.

This meant that while the number of items it sold last year increased by 5.3%, it did not see a rise in value sales.

Credit rating agency Fitch said shoppers continued to turn to Iceland for value “despite heightened competition”. However, its market share has remained relatively flat in recent years at around 2.3%, with latest industry data from Worldpanel by Numerator showing the group’s sales grew only 2.8% over the 12 weeks to 13 June, well behind the leading supermarket multiples and discounters.

Fitch added: “We expect Iceland’s product offering to remain competitive for UK food consumers with weaker spending power.”

However, the credit ratings agency raised concerns over Iceland’s profitability, suggesting the chain would have to continue investing in price cuts at a time when it is battling higher costs. Fitch said: “The company, along with other UK-based retailers, will be hit by the rise in National Insurance and minimum living wage contributions from [this year], which we estimate will result in an additional cost of £50m.”

Iceland’s Chairman, Richard Walker, said earlier this year the National Insurance hike had “added greatly to the cost of business”.

Meanwhile, Iceland’s Chief Executive, Tarsem Dhaliwal, said in April that the company was bracing for surging food costs. Speaking to trade publication The Grocer, he noted that the biggest concern was rising prices being imposed by its suppliers.

He said: “The reality is that we have to be conscious of the fact our suppliers are going to pass the costs onto us, literally straight away. We can’t absorb all that, I don’t think any retailer can, so there’s going to be food inflation.”

NamNews Implications:

• Consumers are shopping around for value via a combination of promos and own-label ‘equivalents’.
• i.e. business is there for the asking…
• …meaning Iceland have had to take a hit on profits to attract their fair share.
• With more cost increases in the pipeline…
• …Iceland are signalling the inevitability of having to raise shelf prices.