Sainsbury’s lags industry on sales after failed Asda bid

Sainsbury’s on Tuesday faced mounting pressure to improve the business as it continued to lose sales to arch-rivals and discounters despite the Easter spending spree.

The supermarkets chain, whose £7.3 billion takeover of smaller rival Asda was buried last week by the competition watchdog, was the only grocer to see a decline in sales, sliding 1.2% for the 12 weeks to April 21.

This was the seventh consecutive fall, according to Kantar data.

All retailers except Sainsbury’s experienced growth over the past 12 weeks, with Aldi and Lidl leading the pack, Nielsen figures also showed today.

The City hopes Sainsbury’s can come up with a credible Plan B as it posts its annual results tomorrow to demonstrate how the grocer can prosper without Asda. Chief executive Mike Coupe, the architect of the deal, spent the past year vigorously supporting the tie-up, which would help it compete with the discounters.

“Two thirds of the public were aware of the proposed merger: the majority who knew about the Competition and Markets Authority ruling didn’t have an opinion as to whether it was a good or bad outcome, while only one third welcomed the decision,” said Kantar’s Fraser McKevitt.

In contrast sales at Tesco, Asda and Morrisons rose 1%, 0.3% and 0.6%. The tills were ringing thanks to shoppers splashing a record-breaking £2.5 billion during Easter week, of which £335 million was spent on Easter eggs.

However, all the Big Four supermarkets lost market share to the discounters, whose combined market share was 13.6%. Sainsbury’s reclaimed its position as second-largest grocer after it fell behind Asda in March, Kantar said.