Supermarket Morrisons has reported another drop in sales but has insisted that its recovery plan is working.
The Bradford-based company reported a 6.3 per cent fall in like-for-like sales in the three months to November 2nd compared to the same period a year earlier. Morrisons has been experiencing falling sales throughout 2014, although the latest figure was less steep than the 7.1 per cent and 7.6 per cent recorded in the past two quarters.
Supermarkets across the UK are facing increasing competition from the rise of discounters such as Aldi and Lidl. Both of these companies have been gaining market share on their more traditional counterparts and it has led to a number of supermarkets embarking on new initiatives to tackle this growth.
Sainsbury's launched its first Netto stores today (November 6th) in partnership with Scandinavian retail group Dansk Supermarked. The outlet, situated in Moor Allerton, Leeds, is one of 15 stores set to open across the UK with the north of England being the main focus of the project.
Despite the drop in sales, Morrisons has claimed that its three-year turnaround is working. It stated that it would "take time for our initiatives to fully benefit our sales performance". This was reflected in the company's share price which grew by five per cent in early trading on Thursday morning.
Morrisons became the first supermarket to take on the discounters in a price campaign. The company's Match and More card, launched in October, pledges to match the prices of groceries offered by Tesco, Sainsbury's and Asda as well as, for the first time, Aldi and Lidl.
Dalton Phillips, head of Morrisons, said that the initiative has been "extremely popular" with its customers, adding that he was “encouraged by the further progress we have made, especially on a number of key operational measures, cash flow and costs”.
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