Tesco Aims to Reclaim 30% Grocery Market Share
The UK's largest supermarket faces pressure from discounters and rising costs as it targets its highest market share in over a decade.
Tesco is preparing to update shareholders this week on its efforts to regain a 30% grocery market share, a milestone not achieved in more than a decade. The supermarket giant has been contending with increased competition from discount retailers Lidl and Aldi, alongside higher operating expenses.
According to data from researcher firm Worldpanel, Tesco's market share slipped to 27.8% in the three months ending September 6, a decrease from 28.1% in the same period last year. The company reached its peak market share in 2007, accounting for nearly one-third of all grocery spending in the UK, before declining to a low of 25.6% in 2020.
The performance is critical for Tesco's chief executive, Ken Murphy, whose annual bonus is linked to the market share metrics. Analysts have projected a range of forecasts for this year's profits, between £3 billion and £3.3 billion, with uncertainty influenced by the ongoing Iran war. Rising cost-of-living pressures and unseasonably warm weather are also expected to have constrained first-half sales growth to approximately 3%, bringing total sales to an estimated £37 billion.