Market Outlook: UK Grocery—Inflation Drives Value Growth Amidst Volume Decline

Published – August 2023

Each Market Outlook offers our analysts’ definitive view of their sector. This research report includes proprietary forecasts, analysis of company metrics, exclusive consumer survey data and our analysts’ consideration of factors and themes in the market. 

In this Market Outlook, we explore the size and trajectory of the UK grocery retail sector and key factors impacting growth. We detail the overall market’s competitive landscape, and present key themes we are watching in 2023 and beyond. 

Data in this research report include: 

• Total sales and year-over-year sales growth in the UK grocery retail sector, 2018–2027E 
• Year-over-year growth in non-specialized food store sales, by value and volume 
• Breakdown of UK food retail sector by channel type, 2021–2022 
• Total online sales and year-over-year online sales growth for UK food retailers, 2017–2026E 
• Inflation for food and non-alcoholic beverages 
• UK offline grocery market share breakdown by retailer, 2018 vs. 2022 
• Top 10 UK grocery retailers’ revenue, 2017–2022 

Introduction 

• Market Scale and Opportunity 
• Segment Breakdown 

Online Market 

Market Factors 

• Inflation 
• Sluggish GDP Growth 

Competitive Landscape 

• Leading Companies 
• Where Consumers Are Shopping 
• Store Numbers 

Themes We Are Watching 

• Positive Momentum Continues for Discounters Amid High Inflation 
• Popularity of the Convenience-Store Format Increases 
• Cost-Cutting Measures by Retailers Erode the Customer Experience and Give Rise to Concerns 

Retail Innovators 

• Trigo 
• Stuart 

What We Think 

• Implications for Retailers 
• Implications for Technology Vendors 

Methodology 

Notes 

22-page PDF report

Companies mentioned in this report include: Aldi, Asda, Lidl, Marks & Spencer (LON: MKS), Morrisons, Sainsbury’s (LON: SBRY), Tesco (LON: TSCO), Waitrose 

1. UK Grocery Retail Sector (Non-Specialized Food Stores): Total Sales (Left Axis; GBP Bil.) and Sales Growth (Right Axis; YoY % Change) 
2. UK Grocery Retail Sector (Non-Specialized Food Stores): Total Sales (Left Axis; GBP Bil.) and Sales Growth (Right Axis; YoY % Change) 
3. UK Grocery Retail Sector: Non-Specialized Food Store Sales (YoY %) 
4. Breakdown of UK Food Retail Sector by Channel Type (%) 
5. UK Online Sales by Food Retailers (Left Axis; GBP Bil.) and Sales Growth (Right Axis; YoY % Change) 
6. Inflation: Total vs. Food and Non-Alcoholic Beverages (YoY % Change) 
7. UK Consumers: Ways in Which Their Cost of Living Has Increased Over the Last Month (% of Respondents) 
8. UK GDP Growth (YoY % Change) 
9. UK Offline Grocery Market Share (%) 
10. Top Eight UK Grocery Retailers’ Revenue for their Latest Reported Fiscal Year (GBP Bil.) 
11. UK Consumers: Retailers from Which They Regularly Purchase Groceries In-Store For Everyday Use (% of Respondents) 
12. UK Consumers: Brands from Which They Have Purchased Groceries, Beverages or Meal Kits Online in the Past 12 Months (% of Respondents) 
13. Top 10 UK Grocery Retailers (by Revenue): Store Count 
14. UK Grocery Market: Share Breakdown by Retailer (%) 
15. Aldi UK and Lidl UK Profitability Financials 
16. UK Convenience Sector Sales (GBP Bil.) and Store Count