Sainsbury’s sees sees boost thanks to demand for clothing

Sainsbury's sign

Sainsbury’s has notched up a sales recovery
The supermarket giant said that inflation, together with this year’s later Mother’s Day and Easter, helped drive like-for-like first quarter sales including Argos up by 2.3 per cent in a marked bounce back on the 0.3 per cent seen in the previous three months.

Sainsbury’s said demand for deals on British strawberries and summer fare provided a boost to grocery sales, which jumped 3 per cent higher, while it also saw 1.9 per cent growth in the number of transactions at its tills.

Clothing sales increased by 7.2 per cent in the 16 weeks to July 1, although general merchandise sales growth including Argos slowed to 1 per cent from 1.5 per cent in the previous quarter.

Mike Coupe, the chief executive of Sainsbury’s, cheered a “strong” first quarter.

He said the group had worked with suppliers in an effort to keep a lid on inflation, which has been sent soaring as the Brexit-hit pound has impacted the price of imported goods.

He added: “The market is competitive and we continue to manage cost price pressures closely.”


Clothing sales increased by 7.2 per cent in the 16 weeks to July 1

Sainsbury’s said total retail like-for-like sales would have been 2 per cent higher with the boost from Mother’s Day and Easter stripped out.

It hailed another robust performance for online sales, up 8 per cent for groceries and 10 per cent for Argos.

Fast track delivery and click and collect continued to prove popular with Argos customers, particularly in the heatwave, when it saw same-day demand for paddling pools and fans soar.

The group said despite slowing overall general merchandise sales growth, it outperformed the wider market.

Woman with shopping bagsGETTY

Mike Coupe, the chief executive of Sainsbury’s, cheered a “strong” first quarter

It added there was disruption from the closure of 78 Argos concessions in Homebase and 84 Habitat in Homebase concessions over the past year.

The group opened 36 Argos Digital stores within its supermarkets in its first quarter, bringing the total to 75.

Melanie Sykes PRANKS Sainsbury’s shoppers for Comic Relief

The food sales rebound comes as a welcome boost to Sainsbury’s, which warned in May over pressures from falling consumer confidence as inflation starts to bite.

The group revealed bottom line profits dropped 8.2 per cent to £503 million for the year to March 11, while underlying profits fell 1 per cent to £581 million.

It has been offsetting this thanks to the addition of the Argos business, snapped up last year when it took over Home Retail Group for £1.4 billion.

With the Argos acquisition under its belt, Sainsbury’s is continuing to look for brands to add to its shopping basket.

It is understood the group is now looking to buy Nisa, the network of more than 2,500 independently-owned convenience stores, in a deal worth close to £130 million, as part of a response to Tesco’s £3.7 billion merger with wholesaler Booker.



About the author

Related Post