Marks & Spencer is on course to replace Waitrose as the supermarket of choice for Middle Britain following a ‘Remarksable’ Christmas.
Sales of food at M&S were up 12.1 per cent in the crucial 12 weeks ahead of Christmas while the figure for Waitrose rose 3.6 per cent.
The net result is that both chains now have a market share of 3.8 per cent with M&S on course to take over as the UK’s seventh biggest supermarket for food.
And M&S could go on to overtake the Waitrose parent company John Lewis in the list of UK’s biggest retailers by 2026 based on a revival in its fashions and homeware.
Marks & Spencer is on course to replace Waitrose as the supermarket of choice for Middle Britain following a ‘Remarksable’ Christmas (Stock photo)
Sales across the M&S stores and its website rose by 7 per cent to £3.9bn in the 13 weeks to the end of December, Marks & Spencer’s trading update revealed yesterday.
As a result, it is on course for profits to show an annual increase of around 33 per cent – a rise of £156m to £640m.
Marks & Spencer shares dropped 5.2 per cent yesterday, despite the good results, as investors were deterred by talk of slightly higher costs and took profits after a run that has een the retailer’s stock rise 84 per cent over the past 12 months.
Almost 29 per cent of households shopped at M&S in December – equivalent to an extra 500,000 compared to the year before – according to analysts NielsenIQ.
M&S, Waitrose and other supermarkets have seen big increases in sales of their premium products and dine in offers as shoppers have switched away from going out to restaurants to the cheaper option of dining at home.
However, the much greater growth at M&S came on the back of the buzz surrounding marquee products, such as its 60 minute Christmas dinner in a box – a British Oakham Slow Cooked Turkey with all the trimmings. including sous vide roast potatoes, Chantenay carrots, festive spiced cabbage, and ultimate turkey gravy.
It sold the equivalent of 2.4 turkeys sold every second which included 195,000 of its pre-prepared slow-cooked turkeys.
Alternatives to turkey were also up with 335,000 beef and lamb joints sold – an annual increase of 14.1 per cent.
A 2023 survey by Which? named M&S as the nation’s favourite food chain with score of 77 per cent, ahead of
Aldi and Waitrose on 73 per cent.
Which? said: ‘Customers loved the appearance of its stores, the service they received from staff and the quality of its products.’
Sales of food at M&S were up 12.1 per cent in the crucial 12 weeks ahead of Christmas while the figure for Waitrose rose 3.6 per cent (Stock photo)
The Friday before Christmas was M&S’s biggest day ever with sales of more than £90m.
It was a record year for its many Christmas creams with sales up 5.8 per cent to 724,000, cranberry sauce up 17 per cent to 612,135 and 400g packs of strawberries more than doubling to 2.2m.
M&S had its biggest ever party food season with sales of some 7.3m packs allowing it to grab 40 per cent of the market by value.
Stand out products were pigs in blankets (538,000 sold), Chicken Kyivs (405,000 sold) and its brand new Our Best Ever prawn toast (290,000 sold).
Other favourites included poinsettia plants with an increase of 13.5 per cent to 635,000, while packs of plastic free Christmas crackers were up 21.3 per cent to 288,000 sold, and stollen sales rose 10.6 per cent to 393,000.
Historically, Marks & Spencer has been seen as an expensive place to shop, however it is now cheaper than Waitrose across many essentials.
Sales of its ‘Remarksable’ value range were up an impressive 18 per cent with many products on a par with or cheaper than the big supermarkets.
Before Christmas, M&S announced that it had price locked 140 customer favourites with the result sales rose 28 per cent. Best sellers included its British sausage rolls, where the number of packs sold rose 43.1 per cent to 858,000.
Historically, Waitrose has been considered the best on the high street in terms of ethical sourcing and animal welfare, however M&S has neutralised this advantage in a tie-up with the RSPCA for milk and eggs.
Analysis by Retail Week predicts M&S will overtake John Lewis by 2026 as the UK’s seventh biggest retailer.
Its insights director Lisa Byfield-Green said: ‘M&S’ willingness to evolve and diversify has been key to its success. It has been on a long-term mission to transform its business, first under Steve Rowe’s five-year plan and now under the ‘reshaping for growth’ strategy led by CEO Stuart Machin and co-CEO Katie Bickerstaffe.’
The net result is that both chains now have a market share of 3.8 per cent with M&S on course to take over as the UK’s seventh biggest supermarket for food (Stock photo)
Mr Machin said: ‘Our strategy to reshape M&S for growth has enabled sustained sales momentum across food and clothing and home over the Christmas period.
‘We enter 2024 with a spring in our step, but clear-eyed on the near-term challenges.
‘We are determined to deliver our objective of driving growth in market share and to increase the pace of our transformation.’
The company said its so-called renewal stores – those that have been refurbished – had performed ‘particularly well’ over Christmas.
They are designed to ‘offer the efficiency of a supermarket’ with elements of a fresh food market, with market-style displays that carry more fresh fruit and vegetables and bakery products as well as ‘fill your own’ sections, wine tasting and ceramic pizza ovens.
Richard Lim, chief executive at Retail Economics, said: ‘These are fantastic results delivered in a challenging market.
‘Shoppers have fallen back in love with M&S, buying into the re-energised proposition that is centred around a leading omnichannel service.
‘It’s been a mightily impressive turnaround and there’s lots of momentum in the business heading into 2024.
‘While the outlook remains challenging, they are well-positioned to navigate through these choppy waters.’
Aarin Chiekrie, (correct) equity analyst at Hargreaves Lansdown, said: ‘In Food, M&S led the market on volume growth every month over the final quarter of 2023. Larger stores performed particularly well as more customers turned to M&S for their full shop.
‘And with cost-of-living pressures weighing on consumers at a historically expensive time of year, the group’s Remarksable value range has come into its element, with sales growing by an impressive 18 per cent.’
