Tesco showing tentative signs of recovery in UK

The UK sales decline at Tesco has slowed for the fourth month in a row, industry data showed yesterday, adding to evidence that Britain’s biggest supermarket group is gradually recovering.

Sales, profit, and asset values at Tesco have been hit by shifts in shopping habits and the rise of German discounters Aldi and Lidl.

Chief executive Dave Lewis, who joined in September 2014, is trying to revive Tesco with a focus on lower prices, improvements to product availability, and customer service, along with better relationships with suppliers.

Tesco shares have increased by a quarter over the last year. Tesco’s UK sales fell just 0.2% in the 12 weeks to March 27, according to market researcher Kantar Worldpanel’s monthly report.

“A small increase in shopper numbers suggests Tesco could return to growth in the next few months; welcome news after 12 months in decline,” said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.

Partly hit by previously announced store closures, Tesco’s market share fell by 0.3 percentage points to 28.1%.

Sainsbury’s, the second-largest player, continued to outperform its ‘big four’ rivals with a sales increase of 1.2%. Asda and Morrisons saw sales declines of 3.9% and 2.4% respectively.

Lidl’s sales were up 17.7%, bigger rival Aldi rose 14.4%.