Has the threat of the discounters to the big four been overstated?

The KPMG/Ipsos Retail Think Tank paper The future of the grocery sector in the UK stated: “It is difficult to see the big four’s hold on the main grocery market being seriously challenged, simply because of their commanding store network market penetration.”

That is despite Aldi and Lidl recording consistent market share gains against losses at Tesco and Morrisons, according to Kantar Worldpanel.

The research, which includes contributions from top industry observers including Barclays head of retail Richard Lowe and Conlumino boss Neil Saunders, found that it would take one of the big four to disappear to give the discounters the opportunity to snap up a large amount of stores and shake up the long-established regime.

The white paper comes in the same week that Aldi revealed plans to double its store estate to 1,000 over the next seven years, opening up to 65 stores each year.

The report said: “The discounters aren’t the slayer of the big four, but they have piqued the interest of a UK consumer bored with the middle-ground brands and keen to make their money go further.”

The Think Tank suggested that a pure-play retailer such as Amazon could “change the balance” of the grocery sector if it were to launch a serious food offer here. It said the big four’s current online offers are failing to win over shoppers due to high delivery charges and fears over product quality.