UK FMCG sales decline as hospitality reopens

During the first four weeks of the hospitality sector reopening in the UK, total retail till sales fell 2.7 per cent, as did grocery sales by 6.7 per cent.

This is according to NielsenIQ monitoring the four weeks ending 22 May. The government gave the green light for restaurants, hotels and pubs to allow guests indoor dining from 17 May.

Despite the fall in grocery sales, food retail sales increased almost 11 per cent compared to the same period in 2019, with shopper spending £9.1bn over the four-week period.

With the ending of restrictions on unnecessary travel, NielsenIQ data shows visits to stores are up by 20 per cent compared to last year.

However, with more frequent visits, spend per visit has fallen to £17.40 from £21.50 in May 2020. Shoppers will also be spending more at travel outlets and other food-to-go establishments.

In the last 12 weeks Lidl (+17.3 per cent), Aldi (+9.5 per cent) and M&S (+7.6 per cent) led growth, whilst Sainsbury (+0.4 per cent) was the fastest-growing retailer out of the "big four" supermarkets, just ahead of Tesco, Asda and Morrisons.

“Despite lockdown restrictions easing, it is evident that online grocery remains popular with British consumers, with almost one in three households still choosing to shop online," says Mike Watkins, NielsenIQ UK head of retailer and business insight. “This suggests that the shift of spend to online that we saw over the last year is now a more permanent fixture for many and part of regular grocery shopping routines.

“With supermarkets placing more investment in their rapid delivery and fulfilment, shoppers are no longer seeing this only as an option for one large shop. Usage is evolving to meet a wider range of shopper needs and meal occasions, no matter the basket size.”