biggest supermarkets are being squeezed out by discounters and more expensive rivals, research shows.Aldi and Lidl, the German discount chains, both saw strong double-digit sales growth over the past three months, according to the latest figures published by Kantar Worldpanel.
At the same time Tesco, Morrisons and Asda have all lost market share.
Morrison's share of the U.K. grocery market dropped to a five-year low this month, indicating that a lack of convenience stores and an online offering continue to weigh on business.
The retailer’s market share fell to 11.1% in the 12 weeks ended September 16 from 11.4% a year earlier. That’s the lowest since the 12 weeks ended Sept 7, 2008, when the share was 11%.
Aldi saw record sales growth of 32.7% over the same period last year and now controls 3.7% of the UK's grocery market. Lidl achieved growth of 14.3%. At the top end of the market, Waitrose saw sales rise 9.7% as it continued to open new stores.
"Strong performances by retailers at both ends of the market pose a significant challenge for the big four supermarkets," says Edward Garner, director at Kantar Worldpanel.
"The combined growth of Lidl, Aldi and Waitrose has taken three market share points out of the grocery market over the past three years and is forcing the major supermarkets to compete for an ever-smaller middle ground."
Garner also argued that price match promotions such as Asda's 'Price Guarantee', Sainsbury's 'Brand Match' and Tesco's 'Price Promise' have meant that cost is less of a differentiator and shoppers cannot be convinced to switch outlets based on cost alone.
