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Sainsbury’s, the second largest supermarket chain in the United Kingdom, had a strong ‘Covid quarter’: in the midst of the corona crisis, its turnover rose sharply as online sales more than doubled.
Strong performance
The retailer reported an 8.2 % increase in sales during the first quarter of its broken financial year, which ended on 27 June. While grocery sales increased by 10.5 %, sales of textiles declined as shoppers mainly bought essential groceries only during their supermarket visits.
Sainsbury’s was able to attract many new shoppers from competitors such as Aldi and Lidl, but also from Tesco, Asda and Morrisons. This was mainly due to the company’s strong online performance: the average weekly number of online orders rose from 370,000 in March to 650,000 in June.
“Our digital performance has been particularly strong, with sales more than doubling”, the retailer explains in a press release. “Nearly 50 per cent of new groceries online customers are new Sainsbury’s customers. SmartShop, which lets customers scan their own groceries and use a separate checkout, reached 37 per cent of sales on average and exceeded 50 per cent in some stores. We have also rolled out our one-hour grocery delivery service Chop Chop beyond London and it is now in 15 cities.”
The retailer does point out that not only the turnover, but also the operating costs increased. CEO Simon Roberts therefore does not expect profit growth in the current financial year: sales increases are unlikely to continue and a potential recession will weigh on non-food sales.
