Grocery sector will be resilient in recession, says survey

Thursday, 29 January 2009

The grocery sector will remain more resilient to the recession than the overall retail market, Verdict has said.

According to the research company, the grocery sector should see 3.1% growth in 2009, compared with a 0.6% decline in spending across the whole retail arena.

Discounting is being carried out as grocers get "aggressive", while inflation is set to fall but will still be a key driver of prices, Verdict added.

Analyst Matthew Piner said: "The fact food is an essential purchase and more consumers [are] eating at home, have all boded well for the market.

"Moreover, food is the one area in which shoppers are likely to continue permitting themselves the occasional, more expensive 'treat'."

Supermarkets are planning to expand further in 2009 after posting solid sales growths over Christmas.

Yesterday Asda confirmed it is going to offer 7,000 job opportunities this year and help those who have been out of work for six months.

Verdict suggested they are trying to "take advantage" of the opportunities coming their way in times of recession.

Piner added: "The convenience-driven nature of food shopping makes store penetration a huge factor and well-located stores, established now, will continue to trade strongly long after the recession is over."

The Confederation of British Industry said this week the overall landscape is to deteriorate in February after a poor start to the year.