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Aldi overtake Co-Op in UK market

Aldi overtake Co-Op in UK market

German-owned Aldi has overtaken the Co-operative to become Britain's fifth biggest supermarket group, highlighting the rapid growth of the discount chain.

Industry data from Kantar Worldpanel showed sales at the discount retailer rose 12.4% to £1.72bn in the 12 weeks to 29 January.

That took its share of the UK grocery market to 6.2% - above the Co-op's 6%, or £1.66bn, and only beaten by the more established big four - Tesco, Sainsbury's, Asda and Morrisons.

Aldi and budget rival Lidl have in recent years won share from Britain's traditional "big four" grocers, putting increased pressure on them to lower prices and raise their game.

"Underpinned by an extensive programme of store openings, the past quarter has seen Aldi attract 826,000 more shoppers than during the same period last year," said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel. "Just a decade ago Aldi was the UK's tenth largest food retailer, accounting for less than 2% of the grocery market. Since then the grocer has grown rapidly, climbing the rankings by an impressive five places to hold a 6.2% market share."

Sales at Lidl rose 9.4 percent, taking its market share to 4.5 percent. Morrisons was the fastest growing retailer within the big four, increasing its market share for the first time since June 2015 with a sales uplift of 1.9% year on year. Despite being overtaken by Aldi, Co-op's 2% sales increase was still well ahead of the market, continuing a run of growth stretching back to July 2015. Growing for the fifth period in a row, albeit at a slower rate, Tesco's sales were up 0.3% year on year as its market share fell to 28.1%. Sainsbury's sales remained flat, whiles its share fell by 0.3% to stand at 16.5%.

The market as a whole continues to grow faster than it did in 2016, with supermarket sales up 1.7% on last year.

Meanwhile, the Kantar figures also showed supermarket prices rose by 0.7%, accelerating the return to inflation seen in December following more than two years of prices falling. "If prices continue to rise at the same rate for the rest of 2017, shoppers will find themselves around 27 pounds worse off," McKevitt said.

The data also revealed that supply issues caused by bad weather in southern Europe meant 759,000 fewer shoppers bought courgettes in January - a fall of 31% - and saw spinach sales slip by 12%.

The latest improvement in Aldi's fortunes appears to confound widely-reported recent criticism that customers were being put off by long queues, untidy stores and crowded car parks. The supermarket's rapid expansion has seen its number of stores grow to around 700.

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