Evidence of the slump in supermarket fuel sales was revealed today in Sainsbury’s latest financial results. Chief executive Justin King blamed cautious customer spending for a drop in first quarter sales of 0.3% at Sainsbury’s when fuel was included, but up 1% when it wasn’t.
Like-for-like retail sales for the first quarter were down 1.1% (excluding fuel), and down 2.4% with fuel included.
Last month AA figures showed the big four supermarkets were the hardest hit by the fall in demand for petrol – supermarkets saw a 4.9% decline while other retailers saw sales fall 3.6%.
King said: “Throughout the quarter we have continued to invest in reducing prices and improving quality, increasing the value of our offer. Lower food price inflation and reduced fuel prices are a welcome respite to customers’ finances but they continue to spend cautiously, leading to industry growth in the quarter being the slowest in a decade.”
However, he confirmed an 18% year-on-year growth in convenience sales and the opening of the company’s 200th convenience store in London.
“During the quarter we opened 27 new convenience stores and refurbished a further 12,” said King. “We opened one supermarket extension, and refurbished three supermarkets. We remain on track to deliver around two new convenience stores per week and around 750,000sq ft of new space this year.
“We expect customer spending to remain cautious and we will continue to invest to keep our offer competitive to help customers balance their household budget. We remain confident that our clear strategy and differentiated offer will allow us to continue to outperform our supermarket peers through the remainder of the year.”