UK Grocery 2018

UK Grocery 2018


Release date: March 4th, 2018 (86 pages)
PDF/Powerpoint format. Price: GBP995.00

Abstract

In a nutshell: consumer spending is under enormous pressure. Prices are rising, wage growth is flat and interest rates are on the up. At the same time, retailers face increasing cost pressures from online, rate rises, minimum wage rises and input cost inflation.

Aldi and Lidl’s successful run in the UK is continuing unabated. Together they now account for around 12% of the market according to Kantar. While the big four are losing share with Tesco, Sainsbury’s, Asda and Morrisons only growing in a lacklustre fashion or with declining lfls, Aldi UK broke through the £10bn barrier in sales for the first time in 2017. And a stop to this growth is not in sight.

The structure of the market is changing, with both Tesco and Sainsbury’s buying into wholesale (Booker) and non food (Argos) respectively. (To us it looks like there is a distinct Brexit shadow hanging over this, a Tesco retreat from overseas to concentrate on the UK and gain better access to the supply chain as well as tapping a new domestic market) Morrisons is the only vertically integrated grocer among the big four and further pushing its agricultural business. The only one of the big four not reacting is Asda.

Looking ahead, the two discounters could more than double their market share from a combined figure of 12% to as much as a quarter of the market over the next 3-5 years.

If it comes to a no deal Brexit then the damage to the sector would be immense. The big 4, Tesco, Sainsbury, Asda and Morrisons would suffer for years to come. And we are saying this without even taking into account their respective challenges and opportunities, by just pointing to the considerable darkening of their horizons in the domestic market.

Table of contents

GDP & Population, EU 28 p8
GDP: EU28 2014, 2015, 2016 in €, ranked by size p9
GDP & Population: analysis and explanation p10
GDP: EU28 2016 in €, ranked by size, Germany – Finland p11
GDP: EU28 2016 in €, ranked by size, Portugal - Malta p12
Population: EU28 2017, ranked by size p13
GDP: EU28 2016, in €, per capita, ranked by size, Luxembourg – Spain p14
GDP: EU28 2016, in €, per capita, ranked by size, Malta - Bulgaria p15
EU28 Retail, On a rebound p16
Retail: EU28 2014, 2015, 2016, in €, ranked by size p17
Retail: EU28 2016, in €, ranked by size, France – Finland p18
Retail: EU28 2016 in €, ranked by size, Greece - Malta p19
Retail sizes: analysis and explanation p20
Retail: % share of GDP, EU28 2016, ranked by size p21
Retail: EU28 2016, in €, per capita, ranked by size, Luxembourg – Cyprus p22
Retail: EU28 2016, in €, per capita, ranked by size, Spain – Romania p23
Grocery Retail, Defensive sector in transformation p24
Grocery Retail: EU28 2015, 2016, 2017, in €, ranked by size p25
Grocery Retail: EU28 2017, in €, ranked by size, France - Denmark p26
Grocery Retail: EU28 2017, in €, ranked by size, Finland - Malta p27
Grocery Retail sizes: analysis and explanation p28
Grocery Retail: % share of Retail, EU28 2016, ranked by size p29
Grocery Retail: EU28 2017, in €, per capita, ranked by size, Sweden - Estonia p30
Grocery Retail: EU28 2017, in €, per capita, ranked by size, Greece – Romania p31
EU28 Retail, Growth p32
Grocery Retail: EU28 2012 - 2017, in €bn p33
Grocery Retail: EU28 2013 - 2017, in y-o-y % p34
Grocery Retail: EU28 2012 - 2017, 5 year growth rate in %, ranked p35
Grocery Retail Growth: analysis and explanation p36
Country profiles: UK – from innovator to laggard thanks to Brexit? p37
Executive summary: Sector in thrall to Brexit uncertainty, discounters, Amazon p38
Market shares and profiles, the leading players p41
UK Grocery Retail: shares, in %, ranked by size, Tesco – Iceland p42
UK: Tesco recovery, cutting subsidiaries, countries and jobs p43
UK: Tesco’s Booker merger/acquisition p44
UK: Tesco Booker, supplier opportunity, synergies, store in store concept p45
UK: online grocery opportunity with Booker, still much to do for Tesco p46
UK: Tesco’s vegan range, store pictures p47
UK: Sainsbury’s – is the Argos acquisition turning sour? p48
UK: Sainsbury’s, job cuts, the failed Nisa tie up p49
UK: Sainsbury’s Nine Elm’s store pictures p50
UK: Asda new boss, Walmart dividend, finally turned a corner? p51
UK: the former Netto stores are still struggling, the runaway success of George p52
UK: Asda job cuts p53
UK: Asda click & collect pick up tower, George concession pictures p54
UK: Morrisons rebounding, partnering with Ocado and Amazon p55
UK: Morrisons – vertical integration as template to emulate for big 4, job cuts p56
UK: Morrisons store pictures, Alexa skill p57
Discounters - Aldi and Lidl transforming UK grocery retail p58
UK: Aldi and Lidl revolutionising UK grocery, Aldi’s declining profits p59
UK: … as Aldi sales accelerate, Aldi store opening plans p60
UK: Aldi Christmas record, breaking the £10bn in sales barrier p61
UK: Lidl fastest growing grocer for Christmas in UK, store expansion plans p62
UK: why Tesco’s discounter attempt will simply not work p63
UK: cannibalisation, Capex, buyer set up, product quality, store footprints p64
UK: multichannel (incl discounter) vs focused discount operation, poor track record p65
UK: too expensive to launch and dubious results p66
UK: Aldi UK, Lidl UK store pictures, PL specially selected, deluxe pictures p67
Online, UK is the leading EU online grocery market p68
UK: the country of home delivery, Tesco champion, Ocado leapfrogging the rankings p69
UK: Asda’s online basket size, Waitrose decline, Morrisons and Amazon p70
Brexit impact, What would happen to food & grocery under a no deal scenario? p71
Food & Grocery: drivers of food price inflation p72
Food & Grocery: our estimates for food price inflation p73
Food & Grocery: no deal impact on price, up to a third more for everyday food p74
Food & Grocery: no deal impact on availability p75
Food & Grocery: animal products and BIPs p76
Outlook, Brexit – the worst case scenario p77
Food & Grocery: growth 2010 – 16, forecast, inflation, volume for 2017-9 p78
Food & Grocery: in £bn 2010 – 19f, skyrocketing inflation, in no deal scenario p79
Food & Grocery: relative winners, hard discounters, vertically integrated Morrisons p80
Food & Grocery: panic buying, collapse of Irish trade, devastation of UK farming p81
Sources p82
Chart 1 GDP: EU28 2014, 2015, 2016 in €, ranked by size p9
Chart 2 GDP: EU28 2016 in €, ranked by size, Germany – Finland p11
Chart 3 GDP: EU28 2016 in €, ranked by size, Portugal – Malta p12
Chart 4 Population: EU28 2017, ranked by size p13
Chart 5 GDP: EU28 2016, in €, per capita, ranked by size, Luxembourg – Spain p14
Chart 6 GDP: EU28 2016, in €, per capita, ranked by size, Malta – Bulgaria p15
Chart 7 Retail: EU28 2014, 2015, 2016, in €, ranked by size p17
Chart 8 Retail: EU28 2016, in €, ranked by size, France – Finland p18
Chart 9 Retail: EU28 2016 in €, ranked by size, Greece - Malta p19
Chart 10 Retail: % share of GDP, EU28 2016, ranked by size p21
Chart 11 Retail: EU28 2016, in €, per capita, ranked by size, Luxembourg – Cyprus p22
Chart 12 Retail: EU28 2016, in €, per capita, ranked by size, Spain – Romania p23
Chart 13 Grocery Retail: EU28 2015, 2016, 2017, in €, ranked by size p25
Chart 14 Grocery Retail: EU28 2017, in €, ranked by size, France - Denmark p26
Chart 15 Grocery Retail: EU28 2017, in €, ranked by size, Finland - Malta p27
Chart 16 Grocery Retail: % share of Retail, EU28 2016, ranked by size p29
Chart 17 Grocery Retail: EU28 2017, in €, per capita, ranked by size, Sweden - Estonia p30
Chart 18 Grocery Retail: EU28 2017, in €, per capita, ranked by size, Greece – Romania p31
Chart 19 Grocery Retail: EU28 2012 - 2017, 5 year growth rate in %, ranked p35
Chart 20 UK Grocery Retail: shares, in %, ranked by size, Tesco – Iceland p42
Chart 21 Food & Grocery: growth 2010 – 16, forecast, inflation, volume for 2017-9 p78
Chart 22 Food & Grocery: in £bn 2010 – 19f, skyrocketing inflation, in no deal scenario p79
Table 1: Grocery Retail: EU28 2012 - 2017, in €bn p33
Table 2: Grocery Retail: EU28 2013 - 2017, in y-o-y % p34