Big supermarkets increase their holdTesco extends lead over rivals

22 February 2008

A woman pushes a shopping trolley around a supermarket.

The battle among big supermarkets in 2007 got even more intense, according to a new report.

However the picture looks increasingly bleak for smaller grocery businesses trying to compete with the national chains.

And while Tesco extended its lead over its rivals for the ninth year running in 2007, supermarkets outside the big four gained ground, according to analyst Datamonitor.

Co-op Group, Marks & Spencer (M&S), Somerfield and Waitrose all grew last year – the Co-operative Group was helped by the merger of the two largest co-operative societies last year, while M&S expanded with new food halls and Waitrose continues to open stores.

Meanwhile all eyes are on Somerfield with predictions that it will be sold by its owners in 2008.

Big four

Of the others, Asda had a good year while Morrisons and Sainsbury's made solid progress.

But Tesco still holds a huge lead and added more retail space in 2007 than its three main rivals combined.

However there was also good news for the lesser players with the hard discounters Aldi, Lidl and Netto all continuing to grow.

With the top 12 doing so well the outlook for smaller operators and independent retailers looks bleak.

‘Most leading grocers now have the capacity to open sites in any UK location and independent operators have no choice but to compete directly with them for business,’ said retail analyst, Nick Gladding.

Last week the Competition Commission called for an independent ombudsman to oversee the UK's supermarkets.