Aldi has overtaken the Co-op to become the UK’s fifth largest grocer as the discount supermarket stepped up the pace of growth in January.
The German retailer increased its market share to 6.2% in the 12 weeks to 29 January compared with 6% for the previous three months, after sales rose 12.4%, well ahead of the market.
Fraser McKevitt, the head of retail and consumer insight at Kantar Worldpanel, said: “Just a decade ago Aldi was the UK’s 10th largest food retailer, accounting for less than 2% of the grocery market. Since then the grocer has grown rapidly, climbing the rankings by an impressive five places.”
He said that Aldi had attracted 826,000 more shoppers than the same period last year after it opened 70 new stores.
Matthew Barnes, the chief executive of Aldi UK and Ireland, said: “Aldi customers get products of comparable quality to the leading brands at prices that are significantly cheaper than any of our competitors. This unique offering is resonating with British shoppers and we are opening 70 new stores this year to help keep up with customer demand.”
While their pace of growth has slowed in the past two or three years, Aldi and Lidl now control nearly 11% of the UK grocery market after the major players Tesco, Sainsbury’s and Asda all lost share.
The rise of the discounters, which stock a much smaller range of goods than in most rival stores, has led to price cuts across the sector as the traditional supermarkets try to win back shoppers.
Of the big four supermarkets, only Morrisons gained market share in the period, taking it to 10.9%.
The Bradford-based chain increased sales by 1.9% compared with the same period last year, boosting its share of sales for the first time since June 2015. McKevitt said Morrison’s premium own label The Best range proved “a real bright spot” with sales up by 35%.
Sainsbury’s sales were flat year on year, while Tesco’s rose 0.3%. Asda continued to lose sales and market share although it slowed the pace of decline to 1.9%, from 2.4% reported at new year.
However, the sector has been lifted by the rise in inflation – from 0.2% to 0.7% in the three months up to 1 January. Even Aldi and Lidl have begun raising the price of basic groceries, including milk and bananas, as the weakening pound increases costs.