Consumers are now paying a record £571 more on average for their groceries than last year as discounter Aldi became the UK’s fourth biggest supermarket for the first time, figures show.
Grocery price inflation reached 12.4% last month, up from the previous record of 11.6% last month, research firm Kantar reported.
The latest figure means the average annual grocery bill will rise from £4,610 to £5,181 if consumers don’t change the products they buy and the way they shop to cut costs.
Categories such as milk, butter and dog food are growing particularly fast, at 31%, 25% and 29% respectively.
However, shoppers are taking steps to manage their budgets by expanding the range of stores they visit, with Aldi’s market share increasing by 1.2 percentage points to become the UK’s fourth largest supermarket for the first time .
The German discounter’s sales rose 18.7% in the 12 weeks to September 4, reaching a 9.3% market share, while fellow discounter Lidl increased its sales by 20.9% and its market share up to 7.1%.
In addition, sales of the cheapest own-label value products are up 33% from a year ago, with nearly one in four baskets containing one of these lines.
Total spend across all of the retailer’s own-brand lines was £393m higher over the past four weeks, increasing its market share to 51.1%.
Takeout grocery sales rose 3.8% in the quarter, the third straight month of growth after more than a year of declines as a result of pandemic comparisons.
Fraser McKevitt, head of retail and consumer insights at Kantar, said: “There appears to be no end in sight to grocery inflation as the pace at which food and drink prices rise continues to accelerate- yes
“In what is a very competitive sector, supermarkets are reacting to ensure they recognize the challenges consumers face and offer the best value, in particular by expanding their own brand ranges.”
He added: “In the early 2010s, Tesco, Sainsbury’s, Asda and Morrisons together accounted for more than three-quarters of the sector, but the traditional big four no longer exist.
“Discounters have seen a dramatic increase in sales in recent months, bringing more and more customers through their doors. Aldi has done well to expand its shopper base, supported by steady store openings and with 14.2 million consumers visiting the grocery store in the past three months.
“Meanwhile, for the fourth consecutive month Lidl was the fastest growing grocer and posted its strongest sales performance since October 2014.”
Even with the increased prices, parents had to prepare for the end of the summer holidays as most schools returned in early September.
Sales of sliced bread increased by 12% compared to the previous three weeks, while cheese snacks grew by 18% and children’s yoghurts by 57%.