Grocery sales will fall at Ocado this year for the first time in the company’s history as customers cut back orders in response to rises in the cost of living (The Financial Times £). Ocado has warned that consumers tightening their belts in response to surging inflation will result in the first ever decline in annual sales at its grocery business (The Times £). Ocado has warned that annual sales will drop because customers are trading down to value products and buying less overall amid a worsening cost-of-living crisis (The Guardian).

Ocado says more of its customers are buying fewer items and trading down to cheaper options as they try to navigate the cost of living crisis (Sky News). The online retailer said surging energy costs and other inflationary pressures had led to more customers ordering smaller basket sizes and cheaper products, including from its own-label range (The Daily Mail).

If only Ocado could have a pandemic every year. Incarcerate enough people and suddenly the business model makes sense, writes Alistair Osborne in The Times. “Now reality has dawned, as the venture’s third-quarter figures drove home… Yes the group, valued at £5.6 billion, has “almost £2bn liquidity”. But Steiner is yet to prove Ocado isn’t hungrier than its customers.” (The Times £)

Nils Pratley in The Guardian writes: “Many of the underlying factors will probably soon afflict mainstream supermarkets: customers trading down and basket sizes getting smaller… But the uniquely Ocado factors relate to the model. Having had too little capacity during Covid, the business now has too much as new warehouses have come on stream.” (The Guardian)

The stampede to discount chains has helped Aldi overtake Morrisons as the UK’s fourth-largest supermarket chain for the first time - with inflation continuing to affect grocery bills (Sky News). Aldi is now the UK’s fourth-largest supermarket after it leapfrogged rival Morrisons by taking a bigger share of the market in recent weeks (The Financial Times £). Aldi has overtaken Morrisons to become the UK’s fourth largest supermarket for the first time, as grocery inflation hit a new record of 12.4% last month (The Guardian). It is a blow to Morrisons, which had been the fourth largest grocer ever since its acquisition of Safeway 18 years ago (The Times £). Aldi overtakes Morrisons as UK’s fourth largest supermarket as cash-strapped shoppers turn to discounters (The Daily Mail). Discounters are grabbing more market share as shoppers take steps to manage their budgets, Kantar said (The BBC).

CD&R’s £7bn Morrisons takeover is proving one of the biggest disasters of the Covid dealmaking boom, writes Ben Marlow in The Telegraph. American financiers left with buyers remorse after supermarket chain eclipsed by Aldi. (The Telegraph)

Investors in Fever-Tree Drinks heaved a sigh of relief as fears that the premium tonic maker might issue another profit warning amid weak consumer demand proved wide of the mark (The Times £). Fever-Tree shares regained some of their sparkle as its latest results left nervous investors breathing a sigh of relief (The Daily Mail).

The London-based maker of mixers has experienced higher freight charges and labour shortages in the US, which have slowed production, while increased gas prices have pushed up the cost of glass bottles (The Financial Times £)

Inflation: some consumer stocks are more equal than others, writes the FT. Inflation is hitting consumer businesses differently as it works its way through the system. Cost pressures are easing as economies slow, but patchily. Some agricultural commodities are near normal levels. Energy prices are falling, but remain historically steep. (The Financial Times £)

Queen’s favourite brands hope to keep Royal Warrants, writes the BBC. The Royal Warrant Association has said that these 600 businesses must now reapply for their warrants. They are reviewed after a change in reigning sovereign but companies can continue to use the Royal Arms in connection with the business for up to two years. (The BBC)

Sainsbury’s is giving its lowest-paid shop workers a second pay rise in a year as well as extra discounts and free food during their shifts in a £25m package to help them cope with rising living costs this winter. (The Guardian)

Starbucks will spend another $450mn to overhaul its coffee machines and stores as it seeks to accelerate its growth, catch up with changing consumer tastes and repair relations with restive baristas. (The Financial Times £)

 

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