J Sainsbury sales growth slows down
J SAINSBURY, hot on the heels of supermarket archrival Tesco, yesterday revealed that its second quarter sales growth had slowed as food inflation eased in the autumn.
Sainsbury’s said like-for-like sales growth, excluding fuel, slowed to 4.6 per cent rise for the 16 weeks to 3 October down from seven per cent in the previous quarter.
The supermarket cautioned that it expected its “growth to slow in the coming months due to reduced food inflation”, but said the group was well positioned for an eventual upturn.
The cautious outlook follows on from Tesco boss Sir Terry Leahy’s upbeat statement about the economy.
Sainsbury chief executive Justin King hit back at Leahy’s comments that Tesco was catching up with its faster growing rivals.
King said: “I think we are clearly showing stronger growth than Tesco during the period.”
Sainsbury’s said that its low-cost Basics range now accounted for 30 per cent of sales, but growth had slowed since the beginning of the year.
King shrugged off Waitrose’s own Essentials low cost range saying “for those customers looking for great deals, they can get those goods at Sainsbury’s at a significantly cheaper price.”
King said that due to lower costs and minimum food inflation confidence was rising and customers were “bouncier” and more willing to “splash out”. Sales of the group’s pricier Taste the Difference range jumped 25 per cent in the quarter.
FAST FACTS J SAINSBURY
&9679; Sainsbury’s is the UK’s third biggest supermarket.
&9679; The group has around 808 stores in the UK and raised £432m in June to fund further store expansion.