Poundland's grocery sales rise as cost of the living…

Poundland's grocery sales rise as cost of the living crisis bites

Value-hungry shoppers are moving from the big supermarket chains to discounters, according to the boss of Poundland.

And as the discount chain unveiled a new range of fresh food at its newest - and biggest - store earlier this year, MD Barry Williams revealed customers numbers were up by as much as 10% against the same time last year, as the as they shop around for bargains amid the cost-of-living crisis.

Mr Williams says that people are shopping around to keep spending under control. “I think you’re seeing a shift, a flight to value, if you like, from the traditional grocers, the major multiples, into the discount channel where we operate. Most discounters are performing better at the moment,” he told the BBC.

The big four grocers - Tesco, Sainsbury's, Asda and Morrisons - have been investing heavily to keeping prices as low as possible for everyday essentials and the market is fiercely competitive. But over the last five to ten years, discount supermarkets such as Aldi and Lidl and low-cost chains such as Poundland and Home Bargains have been nibbling away at supermarket sales, as the discounters steadily improved their grocery offers.

Research shows that one in four households were buying branded products at value retailers such as Poundland, B&M, Poundstretcher and Home Bargains, and Mr Williams announced that Poundland is increasing the number of products it sells for £1 or less, staring this week.

Two thirds of the increased range of £1 products will be branded goods, although Mr Williams has denied that suppliers would achieve the lower price points by resorting to ‘shrinkflation’. “There’s not shrinkflation in this," he said. "That was something that happened in the market a number of years ago. It’s certainly not what’s happening right now.”

Poundland’s sales of frozen food are also up, a category which Williams says tends to perform well at difficult times as it helps shoppers manage waste. Frozen food was introduced to Poundland in 2019, and has recently announced plans to roll out its chilled and frozen range to 100 more stores by September, bringing to total up to around 350 stores. The revamped store in Consett, County Durham, was first to stock frozen food in the North East when it reopened in November 2021.

Earlier this year, Poundland unveiled its biggest store, in Nottingham, which features a bakery, fresh fruit and vegetables and a Costa Coffee machine. Plans are afoot to add these new ranges to over 20 other large stores by the end of the year.

The discounter has also dipped its toe in the convenience market, with two more Poundland Local stores due to open this year in Clapham, London, and Coldfield, West Midlands. The Poundland Local format was unveiled in May 2021, with four convenience stores in Yorkshire and Nottinghamshire.

Poundland has more than 850 stores across the UK. It was founded in 1990, primarily as a discount store with products at a pound, including clearance lines. Over the years the chain has expanded its ranges to include clothing as well as food.

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