Festive Boost: Tesco & M&S Celebrate Record Food Sales Amid Economic Challenges

In a surprising twist amidst ongoing economic difficulties, retail giants Tesco and Marks & Spencer (M&S) have reported notable increases in food sales during the crucial Christmas season. Tesco announced a 3.2% rise in UK sales compared to the previous year, achieving its highest market share in over a decade. Meanwhile, M&S celebrated a record influx of customers, categorizing its food sales as ”strong”.

Despite these promising food sales, M&S faced challenges with its clothing, home, and beauty divisions, which experienced a nearly 3% decline in sales. This decrease was attributed to lower foot traffic on the High Street and the ongoing repercussions of last year’s cyber-attack, which left lingering inventory issues.

M&S CEO Stuart Machin acknowledged the robust performance of their food segment, emphasizing its ability to exceed expectations and reach a new market share milestone. In contrast, he expressed optimism about the recovery of their Fashion, Home, and Beauty sectors.

Tesco CEO Ken Murphy expressed gratification with the retailer’s performance, citing ”intense” competition as a backdrop. He pointed out that the Tesco Finest product line had particularly shone, boasting a 13% growth in sales.

Analyst Sofie Willmott from GlobalData Retail highlighted Tesco’s strategy of price-matching rivals like Aldi and providing exclusive discounts for Clubcard holders, which has helped the supermarket maintain its leadership position in the market.

With expectations of reporting annual operating profits nearing the upper end of the projected £2.9bn-£3.1bn, both retailers showcased resilience in their food divisions, navigating the festive season with strong sales despite the overarching economic challenges that continue to affect other areas of their businesses.