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Grocery market battle heats up

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Morrisons, Sainsbury’s, Waitrose and The Co-operative have increased their grocery market share over the last 12 months, while Asda has lost some ground and Tesco has maintained its percentage.

Figures from Kantar Worldpanel indicate that, at 30.8 per cent, Tesco is still the dominant player in the sector - but it is the battle below which is starting to look very interesting.

Sainsbury’s and Morrisons have increased their market share by 0.1 and 0.3 per cent respectively during the year, while second biggest UK grocer Asda has dropped by 0.1 per cent. This trend became apparent last month, but it may not last long due to recent developments.

The Wal-Mart-owned firm acquired Danish budget supermarket Netto in May, which should help restore its lost market share in the months to come. The plan is to re-brand all Nettos by the summer of 2011.

Retail analyst at Consumer Equity Research, Charles Allen, said this purchase, which cost the firm just under £800 million, “should put it far enough ahead” of Sainsbury’s to prevent any imminent top-two breakthrough from Justin King’s company.

One business that does seem to have “considerable momentum at the moment”, according to Mr Allen, is Waitrose, which has recently announced its move into the Channel Islands by purchasing five Sandpiper CI stores, as well as plans to roll out convenience stores later this year.

Waitrose’s battle with the Co-operative, which continues to gain market share by converting Somerfield stores across the UK, could be one of the most intriguing grocery contests ahead. With the support from its all-powerful alliance, The John Lewis Partnership, there could be more developments to come from the up-market grocer before 2010 is out.

Published on Friday 25 June by Editorial Assistant

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