Convenience and consumer thriftiness see discounters continue to thrive

Convenience and consumer thriftiness will continue to drive footfall through the doors of discounters, industry chiefs have said. It comes as Lidl announced it would reach 1,100 stores by 2025, up from the 880 stores it has today. Thirty-four per cent of higher earning shoppers have chosen to shop at discounters more since the Covid-19 pandemic, new research from Mintel has revealed, with 42 per cent of men aged 25 to 44 increasing their discount shopping. Sales of food discounters are expected to reach £22.5 billion in 2022, a rise of 6.1 per cent, with the food and non-food discount sector accounting for 9.1 per cent of all UK retail sales in 2021. And by 2026, discount, freezer and bargain stores are predicted to be worth an additional £6.6bn a year according to the Institute of Grocery Distribution. Piers Butel, retail analyst at Mintel, said: "Continuing economic uncertainty and high inflation makes discounters' straightforward, value-led proposition ever more tempting for consumers. "There are still differences in how men approach the activity, with male shoppers generally preferring to spend less time in-store when shopping, so the convenience and speed of the discounters' retail experience, with their smaller ranges and fast checkouts, are likely to appeal to this demographic group."Kim Malley AHDB senior retail analyst added Lidl GB could attract a new type of shopper mission if they were planning on diversifying into convenience stores. "Nearly half of shoppers are more price conscious than at the start of the Covid-19 pandemic, therefore discounters will benefit from those households looking to cut back on spending," she said. "Coupled with this, the discounters are complementing their price message with product communication about quality and British sourcing which is going up consumers agenda. So they are not just relying on price to get consumers through the door. "One point which may hold Lidl back slightly is the legacy trend of online shopping." IssueMr Butel stressed opening up online operations has the potential to pull footfall away from stores, which can be an issue for discounters who are heavily reliant on it. "They will also have to balance their value credentials against the cost of deliveries which consumers are increasingly expecting to be free," he said. "Indeed, discounters may struggle to build full online retail operations without significant changes and possible disruption to the simple, lost cost business model which has been the source of their recent success."