However, in a statement for the 12 weeks to 4 June 2016, the grocery retailer was able to report a slight rise in total retail sales of 0.3% (excluding fuel).
Sainsbury’s hailed the results as a “solid start” to the year, while acknowledging that food price deflation had continued to impact sales and made market conditions “challenging”.
In the update, Sainsbury’s also laid out its five-point strategy to deliver a vision of being “the most trusted retailer” which people love to shop at. These points were:
Knowing its customers better than anyone else
Responding to customer feedback, the company said it had simplified and lowered its pricing. It had abandoned its Brand Match scheme and, instead, had lowered the price of everyday products. For instance, 250g grated Cheddar cheese had dropped from £2.00 to £1.75. It added that the vast majority of its multi-buy deals will be phased out by August.
Great products and services at fair prices
The company has improved and expanded it allergen-free foods to cover more allergen-specific groups than ever before. The Deliciously FreeFrom range now covers nut, gluten, wheat, milk, eggs and soya allergies with “clear, market-leading” labelling.
There for its customers
Sainsbury’s continues to pursue a multi-channel strategy, claiming growth in both its convenience and online grocery platforms. It also highlighted its new Sainsbury’s groceries online app, which it said gave customers greater flexibility with their online shopping.
Colleagues making a difference
The company praised the customer service delivered by its staff members, claiming its in-store operational metrics for both service and availability had exceeded its targets and improved year-on-year.
Its values make it different
Highlighting the importance of its values, Sainsbury’s said its ‘Waste less, Save more’ campaign to tackle household waste was well under way. It said that families in Swadlincote, Derbyshire, were trialling a range of technologies as part of the campaign, including the latest Bosch refrigerator. Fitted with a camera, it allows consumers to see what is in their fridge while shopping to avoid unnecessary waste.
Speaking about the Q1 figures, Mike Coupe, chief executive at Sainsbury’s, said: “We have made a solid start to the year with like-for-like transaction growth across all our channels and total volume growth. Customers continue to shop with Sainsbury’s, knowing we will deliver on our commitment to provide great quality products and services at fair prices, whenever and wherever they wish to shop.
“Sainsbury's is well-positioned. Our core food business offers customers choice, quality and a clear value proposition. General merchandise and clothing continue to perform well with good sales growth across both businesses, and we continue to see encouraging results from Sainsbury's Bank, a significant opportunity for long-term growth.
“Market conditions remain challenging. Food price deflation continues to impact our sales and pressures on pricing mean the market will remain competitive for the foreseeable future. However, we are confident that our strategy to be a trusted multi-channel, multi-product and -services retailer is delivering and will enable us to continue to outperform our major peers.”
In May, Sainsbury’s reported a 14% fall in underlying yearly profits but a £620m rise in pre-tax profits.