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Sainsbury's boss: Shoppers could ditch discounters in 'six to 12 months'

Sainsbury’s boss Mike Coupe believes shoppers could start ditching the discounters in favour of the supermarket giant within the next year.

According to Retail Week, Coupe said consumers would soon start to “trade up within ranges and with supermarket fascias” as memories of the recession fade.

But Coupe admitted Sainsbury’s is braced for a response from discount duo Aldi and Lidl, after Sainsbury’s investment in price helped drive “broad-based” volume growth of 1.5% to 2% during its first quarter.

Despite that improvement, the grocer’s like-for-like sales dropped 21. per cent in the 12 weeks to June 6 while total retail sales were down 0.6%, but Coupe insisted that Sainsbury’s has seen some “encouraging signs” for the medium to long term.

He said: “If you look at other recessionary cycles, as people have a bit more money in their pocket like they do at the moment, car sales are pretty strong, as are TV sales and electricals.

“People take more holidays and slightly better holidays and perhaps the thing that’s most significant for food retailers is that people tend to start eating out a little bit more. We’ve seen a lot of growth in the restaurant sector over the last three to six months.

“But if you wind forward and draw on what’s happened in previous recessionary cycles, as we come out the other side people tend to trade up within ranges and within supermarket fascias. In our view, that should put us in a stronger position.

“We haven’t seen that yet, and if you look at other recessionary cycles we probably won’t see it for another six to 12 months.”

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