Morrisons has experienced its highest sales growth in the past year, capitalizing on the appeal of the FIFA World Cup and warm weather. This supermarket, currently undergoing a major restructuring and transformation, announced that like-for-like sales in the 13 weeks ending July 26 increased by 3.2%.
Transformation Under New CEO
Rami Baitiéh, the new CEO of Morrisons, appointed in November 2023, stated that this sales increase reflects the success of the supermarket's new strategies and emphasized that the company is on the right track. Baitiéh has sought to rescue Morrisons from recent crises by reducing prices and improving services to compete with its German rivals, Aldi and Lidl.
Challenges in a Competitive Market
However, Baitiéh acknowledged that market conditions remain "very competitive" and the price war among major supermarkets continues. Even well-known supermarkets like Waitrose have been forced to lower prices to compete with their rivals. Waitrose recently announced it would spend £20 million to reduce prices on nearly 400 products.
Baitiéh added, "We have outperformed the market in terms of strong growth and achieved good results. This has been our best quarter since Q2 2025 and the fifteenth consecutive quarter of like-for-like sales growth." He also emphasized the importance of maintaining low prices, stating that this has been a key factor in Morrisons' recent success.
Last month, Morrisons introduced a new initiative called "Unbeatable Prices" for over 500 everyday products. This initiative promises that the prices of these products will be equal to or lower than those at Aldi, Asda, Lidl, Sainsbury’s, and Tesco, which Baitiéh noted has had a positive impact.
Recent statistics show that Morrisons has managed to maintain its market share at 8.4% in the 12 weeks ending September 6, with sales increasing to £3.06 billion. This comes as the business has faced numerous challenges since being acquired by private equity firm Clayton Dubilier & Rice in 2021, with its debts reaching £7.5 billion last year.
However, Jonathan de Mello, founder and CEO of retail consultancy JDM Retail, pointed out that recent results are still disappointing and largely driven by temporary sales increases. He stated that Morrisons' ongoing problem is its failure to offer distinctive propositions and a lack of customer access compared to larger competitors. Additionally, the heavy debt of £7.5 billion hinders investment for growth and development.
These developments come as Morrisons' main rival, Asda, which is also facing similar challenges after being acquired by private equity, has announced that it is in recovery mode. Statistics show that Asda's sales increased by 0.1% in the 12 weeks ending September 6, reaching £4.17 billion, marking its first growth since March 2024.
