Lidl is near overtaking Morrisons to grow to be the UK’s fifth-biggest grocery store chain after a gross sales rise as customers tried to offset higher household bills with low cost groceries.
The German-owned discounter elevated gross sales by 10.7% within the three months to 11 August, in keeping with the newest market share knowledge from analysts at Worldpanel, previously generally known as Kantar. This was greater than double the tempo of the broader market, which rose 4.5%.
That put Lidl’s share of the grocery market at 8.3%, 0.1 proportion factors off Morrisons’ share of 8.4%, because the Bradford-based chain continued to battle with gross sales up simply 0.9%.
Morrisons is making an attempt to show round efficiency after increase money owed in a £7bn takeover by the US personal fairness group Clayton, Dubilier & Rice in 2021.
Tesco, the UK’s greatest grocery store chain , notched up gross sales development of seven.4%, taking its market share to twenty-eight.4%, properly forward of any rival. Its closest competitor, Sainsbury’s, elevated gross sales by 5.2%, taking its market share to fifteen%.
The UK’s quantity three chain, Asda, additionally continues to have difficulties. Its gross sales have been down 2.6% regardless of efforts to show round efficiency after the return of its former boss Allan Leighton as chair.
Asda is at risk of being overtaken by the discounter Aldi, which is only one proportion level behind it with a market share of 10.8%. Aldi’s gross sales grew 4.8% prior to now three months.
Aldi and Lidl proceed to quickly open shops, placing them on monitor to enter the highest tier of British supermarkets and disrupt the normal “huge 4”.
Asda and Morrisons’ development is behind the 5% stage of grocery inflation registered in August by Worldpanel, suggesting the quantity of inventory they offered has dropped.
Worldpanel mentioned inflation had eased 0.2 proportion factors in August from the 5.2% price registered in July as costs of pet food, sweets and glowing wine, together with champagne, fell again.
Fraser McKevitt, the top of retail and client perception at Worldpanel, mentioned: “We’ve seen a marginal drop in grocery value inflation this month, however we’re nonetheless properly previous the purpose at which value rises actually begin to chunk and customers are persevering with to adapt their behaviour to make ends meet.
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“What individuals pay for his or her grocery store purchasing usually impacts their spending throughout different elements of the excessive avenue, too, together with their consuming and consuming habits out of the house.”
He mentioned informal eating and quick meals eating places had recorded a specific decline in guests over the summer season, and such journeys had fallen by 6% through the three months to mid-July 2025 in contrast with final yr. Nevertheless, espresso retailers bucked the development as their gross sales continued to rise.
Whereas slicing again on eating out, households appeared extra ready to deal with themselves at house. Gross sales of branded items have been up 6.1%, rising quicker than own-label alternate options, which rose 4.1%, a turnaround from earlier within the yr. Premium own-label items, equivalent to Sainsbury’s Style the Distinction or Tesco’s Most interesting ranges, have been additionally up strongly – by 11.5%.
Whereas nonetheless comparatively excessive, the potential peak in inflation might be excellent news for the chancellor, Rachel Reeves, as she weighs spending cuts or tax rises in her autumn price range.
