The UK's biggest supermarkets are feeling the pinch. They're being squeezed at the top from high-end grocers such as Waitrose, while discount supermarkets such as Aldi are taking a sizeable chunk out of market share at the bottom.
This 'sandwich effect' was evidenced by fresh figures from Kantar Worldpanel covering the 12 weeks to 23 December. Waitrose achieved 5.4 per cent growth in till sales over the period, while Aldi posted a growth rate of 30.1 per cent. In contrast, Tesco's share of the till spend dipped slightly, while Sainsbury’s rose 3.4 per cent and Morrison’s fell 0.6 per cent.
"Historically, the discounter sector has seen its share dip at Christmas as shoppers treat themselves and trade up," says Edward Garner, director at Kantar Worldpanel. "But the all-time record share for Aldi shows that this is no longer the case."
Retail sales in December were up just 0.3 per cent on a like-for-like basis, according to the British Retail Consortium's latest sales monitor, while non-food sales between October and December were up 0.1 per cent on a year ago.
Helen Dickinson, director-general of the British Retail Consortium, says the results were "not a cause for celebration, but not a disaster either." David McCorquodale, head of retail at KPMG, says Christmas trading marked a "flat end to a flat year".
"While some retailers will report record Christmas sales, most will breathe a sigh of relief because it could have been much worse." He added that January will be tough as consumers face up to their post-Christmas credit card bills and 2013 could see further market contraction.
