BUSINESS STUDIES

Changing trends in the UK supermarket sector.

Britain’s grocery market is growing at its slowest pace since 2005, with only discounters as well as Waitrose and Sainsbury’s defying the downturn and growing market share.

Sainsbury’s was the fastest-growing of the big four supermarkets, increasing sales by 2.7 per cent in the period, which boosted its market share by one percentage point to 17.1 per cent.

However, Tesco and Morrisons both lost market share to rivals, with sales decreasing by 0.4 and 2.5 per cent respectively. The pair have been the worst hit by rising competition from discounters, which have been aggressively opening new stores across the country and have benefited from a shift in consumer shopping patterns.

Aldi and Lidl together now account for 7.3 per cent of the market, up 1.3 percentage points from last year. Sales in the 12-week period leapt by 32 per cent and by 17.2 per cent at Lidl. Meanwhile upmarket grocer Waitrose sales were up 5.6 per cent compared with a year ago, helping it to grow its share of the market to 4.9 per cent.

Source: City AM, February 12th 2014

Answer all questions below using the information above, as well as your own research.

1) Research and identify the definition of ‘market share’. 2) Rank the supermarkets in terms of market share. Start with the highest first. 3) Rank the supermarkets which have grown in term of sales growth using the above

data. 4) Choose one supermarket which is growing and give two reasons why this is

happening in detail 5) Choose one supermarket which is declining and give two reasons why this is

happening in detail. 6) Identify five new products or services which Tesco sells today that they did not ten

years ago. Explain why Tesco may sell these products or services now. 7) Tesco is limited company, what does this mean?