Lidl overtakes Waitrose to become seventh biggest supermarket in the UK

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Lidl has overtaken Waitrose to become the UK’s seventh largest supermarket as shoppers cope with inflation by turning to the discounters, figures show.

The German retailer increased its market share to a record high of 5.2 per cent over the 12 weeks to August 13, according to Kantar Worldpanel, as 10 million households visited its expanding network of stores.

It increased sales by 18.9 per cent overall, with alcohol and fresh produce performing particularly well.

Aldi was not far behind with sales growth of 17.2 per cent, attracting 1.1m more shoppers than this time last year and increasing market share to 7 per cent.

The discounters’ success coincides with like-for-like grocery inflation increasing slightly to 3.3 per cent after holding steady at 3.2 per cent for the past two months.

At this rate, price increases could add a further £138 to the average household’s annual grocery bill, with the price of butter and fish most affected, Kantar said.

Overall supermarket sales grew by four per cent year on year, although the disappointing summer weather saw sales of ice cream down nine per cent and burgers slumping by 25 per cent – an £8m loss year on year.

All four of Britain’s biggest grocers managed a growth in sales for the fifth consecutive period, a run of collective success not seen since 2013.

However, pressure from the discounters means they now account for just 69.3 per cent of the UK grocery market, down from 76.3 per cent five years ago.

Tesco saw overall sales grow by three per cent but its market share fell to 27.8 per cent, while Morrisons increased sales by 2.6 per cent as its market share dropped slightly to 10.4 per cent and Sainsbury’s sales rose by two per cent as its share fell to 15.8 per cent.

Fraser McKevitt, head of retailer and consumer insight at Kantar Worldpanel, said: ‘Lidl is growing sales 40 per cent faster with families than with households without children.

‘Families tend to buy more items each time they shop, so strong growth with this demographic has helped Lidl to increase its average basket size year on year.’