Discounters set to drive growth in UK food and grocery market

Discounters are set to play a significant role in driving 12.5% growth in the UK food and grocery industry by 2024, contributing £4 in every £10 of growth over the next five years, according to forecasts.

The German supermarket discounters Aldi and Lidl as well as variety discounters such as Poundland, Home Bargains and Poundstretcher, will make the biggest cash contribution to market growth at 40.2% or £9.8 billion out of a total £24.1 billion, fuelled by ambitious store-opening programmes, the latest figures from research organisation IGD suggest.

Aldi is on track to open 1,200 stores by 2025 while Lidl is upping its openings to 50 to 60 a year, IGD said.

This is contributing to an increased perception among shoppers of the German chains as supermarkets rather than discounters, with 21% saying they currently use food discounters for the majority of their shopping and 26% suggesting this will be the case for them by 2022. The average shopper now make three trips to food discounters a month, according to IGD’s figures.

Online will be the fastest growing channel, with the highest predicted percentage growth, but will now be only just ahead of discount at 43.8% or £5.1 billion.

Overall, people make 24 grocery shopping trips a month and spend 18.3 hours planning, travelling, shopping for and unpacking.

IGD spokesman Simon Wainwright, said: “Food and variety discounters continue to grow their market share rapidly, fuelled by ambitious store-opening programmes.

“With many food discount shoppers now perceiving Aldi and Lidl as supermarkets rather than discounters, and more targeted investments in categories such as fresh produce, meat, bakery and beauty, the channel will continue to experience notable growth.”