Champagne and sweets: Brits are fighting the Christmas COVID blues

After a difficult 2020 that ended with further tightening of restrictions, Britons spent a lot in December 2021, with supermarkets and clothing and homeware retailers reporting better than expected results so far.

“Customers really wanted to shop this year,” Simon Roberts, managing director of Sainsbury’s, told reporters on Wednesday after Britain’s second-largest supermarket group raised its earnings outlook for the whole market. anne.

The chain recorded its best-selling champagne and sparkling wines, while sales of its premium food and drink line “Taste the Difference” were up 13% from Christmas on a two-year basis.

Roberts’ comments echo those of the UK branches of German discounters Aldi and Lidl.

Aldi said on Monday that its “Specially Selected” premium product line recorded the best-selling products in its history in December, as it sold more than 5.5 million bottles of champagne, sparkling wine and prosecco. .

On Tuesday, Lidl reported that sales of sparkling wines in December were up 24% year-on-year.

Market analyst Kantar estimated that, across the industry, some 627 million pounds ($ 855 million) was spent in high-end supermarkets in the four weeks to December 26, or an increase of 6.8% compared to 2020.


Roberts of Sainsbury’s said the group had “planned big.”

“So on the key Christmas lines, we bought volume in a substantial way to reflect the fact that we thought customers would want to celebrate Christmas in a big way,” he said, noting that the availability of the products grocery store the week before Christmas was “where we wanted it to be” despite challenges in the supply chain.

Sainsbury’s general cargo business, which includes the Argos chain, has been affected by the limited availability of technology, games and toys, hampering sales. However, the focus on more profitable sales helped boost profit margins.

This theme echoes the comments of fashion retailer Next last week.

Next said its inventory levels approaching Christmas were much lower than expected. But the strength of underlying consumer demand has nonetheless enabled the group to exceed its expectations and revise its annual profit forecasts upwards.

Likewise, on Wednesday, sportswear retailer JD Sports Fashion raised its earnings forecast following strong Christmas sales, despite supply chain disruptions to some of its major brand suppliers.

Household and furniture retailer Dunelm reported record sales, aided by shoppers who buy party favors in-store, which they don’t tend to do online.

Despite the optimism, worrying signs are looming on the horizon.

UK consumers are facing a cost of living crisis due to soaring inflation, rising energy bills and tax increases that could disrupt discretionary spending.

Kantar found that sales of indigestion remedies increased 8% in December.

(1 dollar = 0.7335 pound)

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