I’m confused as to what the situation is in regards to the 4 biggest supermarkets in the UK, Asda, Tesco, Morrisons and Sainsburys
All of them seem to be struggling, and partially they say the reason are that the cheaper supermarkets (Aldi, Lidl) Are gaining market share and that customers are making more frequent, shorter trips to the store rather than making one big shop a week. However, I’ve not seen this occur, I regularly shop once a week and witness many others in my locale do the same.
I see it first hand as I started to use Lidl a few years ago and use it more and more as it becomes apparent that the quality of their stuff is pretty damn good. (and their fresh rye bread (80p) and Greek yogurt (£1.50 for 1kg tub) is the best I’ve come across)
Plus, the lack of choice and relative small size of the store makes it a much quicker experience.
so gradually I’ve seen Lidl fill up with more customers and that spending must have a knock-on effect elsewhere.
I think it’s for real but a large part of it is that the big UK supermarkets have spent a long long time getting crappier and crappier while pricing themselves a fat margin on everything. Huge shops crammed full of hundreds of brands for every damn thing, most of mediocre quality at medium or high prices, aisles jammed full of pallets of goods (because they don’t want to pay for enough staff), huge queues to pay at the handful of staffed tills of the perma-broken self service tills (see above). A lot of it was in fact supported by dodgy accounting of deals with suppliers and booking gains on huge banks of development land bought years ago.
It all worked fine while people had money to spend but as soon as people started counting their pennies a bit and paying attention to their grocery spend then the wheels came off the “permanent growth at high margin” wagon. I think they’d have been in trouble regardless but when you get other retailers who can match or exceed their quality, destroy them on price, display a reasonable selection in a small shop and actually let you pay at a manned checkout within a couple of minutes - that really tipped them over the edge. These competitors are tiddlers in the scheme of things, but they’re enough to provide the last push from “uh oh” to “oh feck”.
Clearly the UK big four aren’t managing to differentiate themselves via the mechanism of higher quality and/or more variety.
We have Aldi, Wal-Mart, and a host of other bargain-basement groceries. Yet somehow, the higher end places like Whole Foods, HEB. Kroger (not much higher), Randall’s/Tom Thumb/Safeway, etc… manage to not only stay in business but thrive through that strategy.
Whole Foods goes for the affluent and credulous types who think that organic == healthier, and who believe in all sorts of dumb-assed woo. They definitely charge for the privilege. The other stores are less niche-oriented, but still make a point of having more than house-brand stuff at rock-bottom prices.
Wal-Mart is interesting, in that they have a product mix somewhat less restrictive and bottom-basement than Aldi, but manage to keep prices low through draconian supply chain management and economies of scale. So you can buy your name-brand canned tomatoes at Wal-Mart cheaper than you might be able to get house-brand at some other groceries.
Of course not, why would they? They have spent decades milking the far simpler strategy of “we’re everywhere and we have everything and we all charge pretty much the same price which is a bit less than the small independents”. Their core skillset is:
wringing backhanders out of suppliers terrified of being denied shelfspace
‘persuading’ local authorities to let them build acre-sized superstores in the most ridiculous locations no matter what the consequences in terms of traffic etc.
Coping with any consumer behaviour other than “let’s just go to the nearest megastore and hand them all our money” is utterly beyond them.
In terms of higher quality, people wanting that have always gone to waitrose or an independent and paid a bit more. Variety - the big four stock essentially every mainstream brand of everything, and if they don’t all charge the same price its only because of one of their mind-bending constellation of buy one get one free if you buy two of these with a cupon and your total spend was more than £100 a week last tuesday or some such nonsense.
But nowadays e.g. Lidl have a lot of really cheap crap - but they also have some stuff that is better quality than what the big four sell for the same price. E.g. my local one has a smaller selection of fruit & veg but because they are competent at stock management it was usually fresh - they sold it almost all by the end of each day and had new the next day. At Sainsbury’s there were dunes of fruit & veg as far as the eye could see, half it it perished, most of it poor quality, and all of it overpriced. Lidl would have occasional stuff like frozen lobster, frozen duck breasts and stuff at great prices and shift it fast. Sainsbury’s would have that at everyday high prices and most of it would sit there for ages.
My other half actually wrote a letter of complaint to Sainsburys complaining that every time we went there the shelves were half empty and the aisles were blocked with pallets of merchandise lying around. She got a letter back saying that they couldn’t find people willing to work night shift restacking shelves so they had to do it during the day - they were silent on why they apparently didn’t have more than two people working on it during the day.:rolleyes: The local Lidl and Aldi aren’t exactly generous employers but yet they somehow manage to find enough staff able to fill the shelves without blocking the aisles…