The Christmas period is the most important time of the year for the major UK supermarkets and 2019 was one of the most challenging in history for the big four (Tesco, Sainsbury’s, Asda and Morrisons), with all reporting disappointing results compared to 2018. The industry uses the measure of like-for-like sales and the average result was a fall of 2.5%.
The big winners in the battle for UK shoppers were the discount operators Lidl and Aldi. Their emergence has seen a level of unprecedented price competition, with the profits of the big four supermarkets reduced by about 40% in the last 10 years. Arguably the biggest loser has been Waitrose, which has seen its target market of middle-and upper-class shoppers migrating over to Lidl and Aldi. This would have been unthinkable a decade ago, but the discount supermarkets have perhaps achieved the holy grail of tapping into the under-exploited area of the market map that delivers high quality at low prices.
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