1. News
June 20, 2022

Tesco’s UK sales fall by 1.5% amid ‘challenging’ trading conditions

The company improved its market share in the UK and kept its full-year profit guidance unchanged.

British supermarket chain Tesco has posted quarterly sales of £9.88bn ($12.09bn) for the 13 weeks to 28 May, down by 1.5% from the same period of last year.

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by GD50 Custom
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The company highlighted that the market remains ‘challenging’ as shoppers are purchasing fewer items and switching to cheaper alternatives due to the rise in inflation.

Tesco chief executive Ken Murphy said: “Whilst the market environment remains incredibly challenging, our laser focus on value, as well as the daily dedication and hard work of our colleagues, has helped us to outperform the market.

“Our material and ongoing investment in the powerful combination of Aldi Price Match, Low Everyday Prices and Clubcard Prices is removing the need for customers to shop elsewhere.

“Although difficult to separate from the significant impact of lapping last year’s lockdowns, we are seeing some early indications of changing customer behaviour as a result of the inflationary environment.

“Customers are facing unprecedented increases in the cost of living and it is therefore even more important that we work with our supplier partners to mitigate as much inflation as possible.”

Tesco’s group retail quarterly sales amounted to £13.57bn, representing a 2% rise in like-for-like (LFL) sales.

The company improved its market share in the UK, driven by the distribution of Aldi Price Match and Low Everyday Prices products. It also kept its full-year profit guidance unchanged.

Tesco claimed to have maintained the largest improvement in quality and value perception of any food retailer in the UK market compared with before the Covid-19 pandemic.

In Ireland, the retailer’s sales were ahead of their pre-pandemic levels, with its market share increasing by 11 basis points from a year earlier.

For the fiscal year 2021-22, Tesco’s total revenue was £61.3bn, up by 6% compared with the previous year.

Free Whitepaper
img

What is the impact of historically high inflation on the UK consumer landscape?

The average UK consumer is experiencing a severe cost-of living crisis as inflation surges to a forty-year high and the price of goods continues to rise. This shock is the result of the sharply increasing costs of commodities, energy, and the ongoing conflict in Ukraine, and is threatening FMCG manufacturers, retailers, and foodservice operators’ ability to survive and grow. Inflation will have a profound effect on many consumer-facing industries in 2022 and beyond. Consult GlobalData’s new whitepaper, Inflation in the UK: The Impact of Historically High Inflation on the UK Consumer Landscape, to better understand shifts in consumer behavior and their impact on spending patterns, as well as the implications for UK businesses. This whitepaper covers:  
  • Why has global inflation returned with a vengeance?
  • What is the current inflation situation in the UK?
  • What impact is inflation having on UK retail sales?
  • What tactics are businesses relying on to tackle the effects of high inflation?
  • How are consumers changing their behaviors to cope with the higher cost of living?
  • Which industry sectors are most vulnerable to reduced consumer demand?
  • How is the government responding to high inflation?
  • How long will high inflation last in the UK?
  • How can your company survive and thrive in a high inflation environment?
Enter your details here to receive your free whitepaper and ready your business for these increasingly uncertain times.
by GD50 Custom
Enter your details here to receive your free Whitepaper.