IGD forecasted a 1.2% growth for the UK grocery market during the holiday season, representing a “strong result for manufacturers and retailers”.
Online shopping would also see a boost of 9.3%, set to generate £1.2bn in sales. This was boosted by a greater degree of choice offered to consumers, thanks to the launch of Amazon Go and Aldo Online.
Joanne Denney-Finch, IGD chief executive, predicted discount retailers will enjoy growth of 6.2%, seeing their sales reach £2bn.
“This would be another good result, although with a stronger proposition from the leading supermarkets on ranging, price and the in-store experience, we don’t think the discounters will grow by quite as much as this time last year,” said Denney-Finch
‘Competition intense as ever’
“Competition is set to be as intense as ever and not only on price. Those retailers and suppliers who combine to offer excellent value plus a compelling in-store experience will capitalise on the strong emotional connection between food, drink and Christmas.”
It is the second year in a row that IGD has predicted gradual growth in sales during the Christmas period.
Last year, the organisation predicted shoppers would spend £20.3bn during the festive season, which was 1.4% higher than the £20bn spent in 2014.
A trend of “savvy shoppers” continues into December, with many consumers opting using vouchers and store loyalty schemes to reduce the cost of their shopping.
‘Splash out on food’
Denney-Finch said: “For many shoppers (54%), Christmas is a time to splash out on food and groceries, yet the savvy shopping habits established over many years still apply during the festive period.
“Almost half (46%) collect coupon points on their loyalty cards to use at Christmas, representing a clear opportunity for retailers to lock in purchases.”
Lower prices of food had also boosted sales, claimed Denney-Finch.
However, food prices could rise in the wake of the UK’s departure from the EU, warned food a range of food and drink organisations.
The increases would be caused by the industry losing access to non-UK EU workers, warned 32 food and drink organisations – including the Food and Drink Federation and the British Retail Consortium.
Grocery Aid pays out £900k to beneficiaries
Grocery Aid, the National Grocers' Benevolent Fund, has paid out more than £900,000 to members of the grocery supply chain in need of extra aid and support.
Beneficiaries also received £100 for winter fuel and those with children were given £150 per child. The fund has helped 240 children in this way.
Grocery Aid plans to spend more than £4.3M on welfare support next year, both financially and through its GroceryAid Helpline.