UK Food & Grocery Sector Report summary
July 2021
Period covered: Period covered: 30 May – 03 July 2021
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed.
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Food sales growth fell by 00% YoY against a 7.2% rise a year earlier. Against 2019 levels, Food sales rose by 00%, driven by strong volume growth given benign levels of food inflation (c.0.5%) over the last two years. Transference of spend to hospitality
Sales growth continued to be impacted by a transference of spending to hospitality with more being spent on eating/drinking out with fewer meals at home.
Data from OpenTable suggests that table reservations remained well above levels seen when hospitality reopened on 12 April during the month. Indeed, for the week to 21 June 2021, the seven-day average estimate for seated diners grew by 71 percentage points when compared with the week to Monday 19 April 2021 (the week following reopening).
What’s more, Kantar said that footfall to stores fell by five million compared with shopping trips in May due to the transference of spending to hospitality venues.
June 2021 was the warmest, driest and sunniest since 2018 (Met Office) which supported sales of BBQ foods as well as delicatessen (+13.5%), soft drinks (+12.3%), bakery (+8.7%) and crisps, snacks and nuts (+4.1%) (Nielsen).
The start of Euro 2020 on 11 June also created a feel-good atmosphere amongst consumers with many choosing to watch the tournament at home with friends and family given capacity restrictions at hospitality venues remained in place (e.g. the rule of six to a table).
Retail Economics forecasts Food & Grocery sales to drop by 00% year-on-year in 2021.
The weaker outlook for 2021 reflects unfavourable comparisons with 2020 (00%) and the phased reopening of hospitality venues, planned for 12 April (outdoor only) and 17 May (indoor), which will allow pent-up demand for dining out to be released.
Retail Economics forecasts Online Food & Grocery sales to decline by 00% year-on-year in 2021. However, the online penetration rate is projected to remain much higher than pre-pandemic levels at 00% of total sales in 2021, compared to 7.8% in 2019.
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Seated diners, seven-day average, percentage compared with the equivalent week of 2019
Source: Source: Open Table
