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Aldi overtakes Morrisons as UK's fourth-largest supermarket chain

General view of an Aldi store sign

By James Davey

LONDON (Reuters) -German-owned discounter Aldi has overtaken Morrisons to become Britain's fourth-biggest supermarket group, helped by its popularity during the cost of living crisis, industry data showed on Tuesday.

Market researcher Kantar said Aldi's sales increased 18.7% over the 12 weeks to Sept. 4, taking its UK grocery market share to 9.3% from 8.1% a year ago. Morrisons' sales fell 4.1%, with its share falling to 9.1% from 9.8%.

Aldi trails market leader Tesco, Sainsbury's and Asda.

Aldi and fellow discounter Lidl account for 16.4% of the market and continue to open new stores.

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Morrisons had been No. 4 since it took over Safeway in 2004. It has been owned by U.S. private equity firm Clayton, Dubilier & Rice (CD&R) since October.

“Back at the start of the 2010s, Tesco, Sainsbury’s, Asda and Morrisons together accounted for over three quarters of the sector, but that traditional Big Four is no more," said Kantar's Fraser McKevitt.

Morrisons said that market share is partly a function of new store openings, noting that it had not added any significant space for a while.

"Customers don't really care about market share statistics; they care about value, quality, provenance and service - and that is where our focus is going to remain," a Morrisons spokesperson said.

Kantar said that grocery inflation hit 12.4% in the four weeks to Sept. 4, another record, adding 571 pounds ($670) to the average annual grocery bill.

It said that products such as milk, butter and dog food were jumping up particularly quickly at 31%, 25% and 29% respectively.

Total grocery sales by value rose 3.8% in the 12-week period, Kantar said, with sales of the cheapest own-label products up by a third compared with a year ago.

UK grocers' market share and sales growth (%)

Market share Market share % change in

12 wks to 12 wks to sales

Sept. 4 2022 Sept. 5 2021 (yr-on-yr)

Tesco 26.9 27.4 1.9

Sainsbury's 14.6 15.0 1.5

Asda 14.1 14.4 2.2

Aldi 9.3 8.1 18.7

Morrisons 9.1 9.8 -4.1

Lidl 7.1 6.1 20.9

Co-operative 6.5 6.5 2.7

Waitrose 4.7 5.1 -4.7

Iceland 2.4 2.3 5.8

Ocado 1.7 1.7 5.2

Source: Kantar

($1 = 0.8541 pound)

(Reporting by James DaveyEditing by Hugh Lawson and David Goodman)