Belfast Telegraph

Wednesday 17 September 2014

Ulster shoppers flock to discount stores

Thousands of Ulster shoppers are turning their backs on mainstream supermarkets and flocking to their discount rivals instead — at least for some of their groceries.

The latest TNS Worldpanel data has revealed a leap in sales at Lidl across the province, based on the value of till role sales over the past three months to September 7.

It’s a recent development which mirrors trading patterns in Britain where the German superstore now boasts a 2.4% share of the total grocery market.

Similarly, the market research company has found that the frozen-food specialist Iceland increased its British market share over the last 12 weeks, to 1.7%; a trend which appears to be prevailing here.

Speaking to the Belfast Telegraph last night, Marie Burke, Managing Director of TNS Worldpanel, Ireland, said that Lidl’s recent results represent the store’s best achievement to date.

“Lidl has a 5% share of the grocery market in Northern Ireland for the latest 12 weekly period — the highest share they have recorded since arriving in the North.

“According to the data, 50% of shoppers in Northern Ireland shop in Lidl in a 12 weekly period. The area of growth is in alcohol, food and household products.”

But the discounter’s growing popularity also means that the class stigma once attached to shopping in low cost stores has been decisively eroded, from necessity if nothing else.

Speaking to the Belfast Telegraph today, Donald McFetridge, Northern Ireland’s leading retail expert, said the trend is here to stay for the foreseeable future.

“Middle-class consumers are tightening their belts, along with those who are less well off, so there has been a shift in shopping patterns away from mainstream supermarkets,” he said.

“Stores like Lidl and Iceland are becoming increasingly popular because cash-strapped householders are becoming much more frugal and they realise the monetary benefits of shopping around.

“If customers don’t feel the big supermarkets in Northern Ireland are giving them their best possible offers, then I believe the shift towards the discounters will endure.”

The recent sales increase posted by Lidl — which opened its first store in Northern Ireland in 1999 — confirms an influx of bargain hunters at Northern Ireland's main discounter in recent weeks.

Indeed, the results of a survey in an upcoming Mintel Food Retailing report — made exclusively available to the Belfast Telegraph — shows that around a third of UK consumers have switched some of their grocery shopping to cheaper value retailers.

The findings underline an awareness among consumers of the cost of particular foodstuffs, such as rice and pasta, and a change in shopping habits as a result of the economic downturn. Almost one fifth of respondents said they stocked up on certain items in case the price goes up.

“Hard discounters have been working away in the background for a number of years, raising their profile in the retail community and more importantly, improving consumer confidence in their offer,” said Julie Sloan, manager for Mintel Ireland.

“There is already evidence of grocery multiples eg, Tesco and Asda, re-evaluating their ‘value' ranges in order to retain their competitive edge. In light of fuel and food price increases during the last year, Northern Ireland consumers will understandably shop around for some of their core grocery items.”

Already, there is evidence of savings triumphing over snobbery in the shopping stakes. And it’s a behavioural shift that looks set to stay as recession looms large. Consumers here may not be changing the types of food they buy but they certainly seem to be rethinking where they shop.

Speaking to the Belfast Telegraph, a Larne father-of-two said he split his food shopping between Asda and Lidl.

“There’s no shame in a bargain,” he said.

“If shopping around can save me extra money, then I’ll do it and there’s no question that places like Lidl have lower prices.”

In Northern Ireland, the rise in food costs is the highest it has been in 17 years, according to the Office for National Statistics. It means that an average family has to find an extra £713 a year for grocery bills.

Further bad news is that experts predict the high food prices will remain in place for the next decade. An executive at Nestle, the world’s largest food company, said he thought food prices would remain high.

“You will not see commodity prices return to previous levels,” said Luis Cantarell.

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