Lidl overtakes beleaguered Morrisons to become Britain’s fifth biggest supermarket
Lidl has overtaken beleaguered Morrisons to become Britain’s fifth biggest supermarket for the first time.
The German discounter now holds an 8.6 per cent share of the grocery market, according to figures from Worldpanel by Numerator for the three months to 17 May – ahead of traditional heavyweight Morrisons, which has slipped to 8.3 per cent.
Lidl has poached customers from traditional major supermarkets by opening more shops over the past few years, growing its market share to a new record, from 8.1 per cent at the same time last year.
Retail experts say the German retailer has had an impressive ascent, as twenty years ago it made up just 1.4 per cent of the market.
By contrast, Morrisons has been struggling to retain shoppers since its private-equity buyout a few years ago.
German discounters Lidl and Aldi have poached customers from the traditional grocers in recent years
Sales at Lidl leapt 8.8 per cent to £3.16billion over the three months, compared to the same time frame last year. At Morrisons, they grew just 1.3 per cent to just over £3billion.
Lidl’s chief executive for Great Britain, Ryan McDonnell said: ‘Becoming Great Britain’s fifth‑largest supermarket is a significant milestone and a clear indication of the momentum we have built.
‘As customer expectations shift, households are looking for value they can rely on without compromising on quality, and we remain laser-focused on delivering exactly that.’
He said the retailer is moving ahead with ‘ambitious’ expansion plans.
The grocer announced earlier this year that it will open more than 50 new stores in the next 12 months as part of a £600million investment – creating almost 2,000 new jobs.
It plans to open stores this summer, including in Abbots Langley near Watford, Warrington in Cheshire, and Thornbury in Gloucestershire.
The milestone further underscores the turnaround challenge faced by Rami Baitiéh, the boss of the Bradford-based Morrisons, who has been hoping to win customers over with price cuts.
Morrisons was saddled with huge borrowings after it was acquired by US buyout group Clayton, Dubilier and Rice (CD&R) in 2021.
Jonathan De Mello, the founder and chief executive of JDM Retail, said Lidl has been reaping the rewards of ‘its aggressive expansion and a middle-class migration to discount grocery shopping’
He added: ‘In contrast, Morrisons is stuck in the middle, structurally languishing under the crushing weight of its private equity debt and completely failing to maintain its market share.’
He said there was a ‘stark contrast’ between Lidl’s expansion plans and Morrisons decision last week to close 100 convenience stores.
Britain’s two largest grocers, Tesco and Sainsbury’s, saw spending rise by 3.2 per cent and 3.1 per cent, while sales at Aldi rose 0.6 per cent.
Aldi already elbowed Morrisons out of the top four in 2022.
But the country’s other private-equity owned supermarket, Asda, continued to struggle as sales fell 3 per cent.
It comes amid pressure on food prices caused by the fallout of the war in the Middle East.
There are fears of further rises as energy bills are set to soar in the wake of the conflict, which has also disrupted key shipping routes.
Labour is facing fresh criticism from supermarkets and business groups after proposing shops limit the price of essentials such as eggs, bread and milk.
The suggestion has been branded as ‘completely preposterous’ by Marks and Spencer chief executive Stuart Machin, who is among the high-profile retail bosses urging the Government to reverse tax hikes.
Even upmarket Waitrose said it was ramping up its price proposition, saying on Wednesday it would take a £20m hit so it can slash prices on 160 staples. It is cutting the price of household essentials – including spinach, chicken thighs, apples and onions – by an average of 12 per cent.
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