The second-largest supermarket in the UK was founded in 1869 by John Japes Sainsbury with a shop in Drury Lane, London. It quickly became a British favourite and by 1922, the company was the largest retailer of groceries, before later being taken over by Tesco in 1995. Today, Sainsbury’s enjoys a 16 percent market share of the supermarket sector, with more than 1,400 stores across Britain.
But, there were concerns over the likes of Aldi and M&S leapfrogging them, as the company struggled to adapt to a changing market in 2018, BBC’s “Inside the Supermarket Series” revealed.
In senior management meeting at the head office in preparation for Christmas 2018, one anonymous member of the team told the room: “We know that the discounters are doing well, Aldi, we know, are catching up.
“Key themes here are that M&S are also continuing to retain dominance.
“Obviously people love to trade-up in their store generally.
Sainsbury’s had concerns over the likes of ALDI and M&S
It’s quite a worry that we’ve kind of lost what we’re here for
“This year, although a small shift in share, they have retained quite a strong position.”
Another member of the team also highlighted political uncertainty as another reason for a poor year.
She said: “Unsurprisingly, over Christmas, consumer confidence was at a real all-time low, Brexit was a large source of that filling down – that wasn’t great, unfortunately.
“We ended the year pretty flat versus the market.”
A third member, who remained anonymous pointed to trends online as a potential problem for Sainsbury’s.
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He said: “Can I add one more iron to that fire.
“This year we actually dropped out of the top 25 Google searches for branded food, so the likes of M&S, Waitrose, Tesco – they all dominated that.
“It’s quite a worry that we’ve kind of lost what we’re here for.”
The series went on to reveal one of the companies marketing tactics to grab hold of the reigns once more.
The narrator said: “With the company being squeezed by the competition, this is going to be one of the most challenging years in the supermarket’s 150-year history.
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“It’s more important than ever that the company sets itself apart from its rivals.
“This year provides a unique marketing opportunity, the 150th birthday.
“On the ground floor of the Sainsbury’s headquarters, there is a warren of kitchens, where new food products for 2019 are being stirred, baked and tested.”
In April 2018, Sainsbury’s also entered talks with Walmart over a proposed merger with ASDA, which would make them the largest UK supermarket.
However, on April 25, 2019, the Competition and Markets Authority blocked the merger and it was abandoned by Sainsbury’s.
In April 2019, whilst awaiting to merge with Asda, Sainsbury’s was again demoted into third place as their rival placed second.
This year’s financial performance has not been released yet.