Supermarket inflation in the UK  has fallen to its lowest in more than a year but remains firmly in double-digit territory with the vast majority of consumers worried about the impact of rising grocery prices.

Latest industry data released this morning by Kantar Worldpanel shows that costs for customers at the tills were 12.2% higher than a year ago during the four weeks to September 3. That was down from 12.7% in the previous month and marked the sixth consecutive decline since grocery inflation peaked at 17.5% in March.

However, wider research by Kantar showed continuing deep concern among shoppers about prices being paid at checkout.

“Grocery price inflation is down for the sixth month in a row but 12.2% won’t be a number to celebrate for many households," said Fraser McKevitt, head of retail and consumer insight at Kantar.

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"Our data shows that 95% of consumers are still worried about the impact of rising grocery prices, matched only by their concern about energy bills. After a full year of double digit grocery inflation, it’s no surprise that just under a quarter of the population consider themselves to be struggling financially – although this is a very slight drop compared to May.” 

The report showed that supermarket own-label sales grew by 9.9% over the month, with discounters Aldi and Lidl continuing to benefit from the shift. Across the board, own-label brands now account for 51% of all grocery sales.

“We’re now marking one year since Aldi became the fourth largest supermarket in Britain and alongside Lidl, it has made some of the biggest market share gains over the past 12 months as consumers continue their hunt for value," Mr McKevitt said.

"This month, Aldi grew sales by 17.1% and Lidl by 16.0%. Between them, the discounters now capture 17.7% of the sector. We expect this performance to continue as inflation remains stubbornly high, however, growth rates for both the discounters have been slowing in recent months as they annualise against rapid rises last year."

The Herald: Inside an Aldi

Kantar also noted shoppers had been making the most of Wilko's closing sales, with its share of non-food groceries such as toiletries and household goods rising from 1.8% in July to 2.3% in August.

Sainsbury’s and Tesco were the fastest-growing traditional retailers, with sales up by 9.1% and 9.3% respectively. Tesco’s share now stands at 27.2%, up 0.3 percentage points from last year, and Sainsbury’s at 14.8%, up by 0.2 percentage points.

Asda’s market share is at 13.8% and Morrisons’ 8.6%, with sales up by 5.1% and 2.0% respectively. Waitrose’s growth accelerated to 5.6%, meaning that it now holds 4.6% of the market. Ocado also saw sales increasing faster than last month, with growth at 4.3% and market share at 1.6%.

Co-op's sales were up by 2.5% versus a year ago with the convenience retailer now holding a 6.1% market share. Iceland’s sales rose by 4.3% to take a share of 2.3%. 

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