Slowing inflation has taken its toll on sales growth of FMCG goods in the UK – the hardest hit of the five major Western European markets.
The latest figures from Nielsen reveal that the UK suffered the largest decline in overall takings at the till in the third quarter at minus 1.8%.
Italy was the only other of the big five Western European markets to find itself in negative territory, at minus 1.2%. Germany, France and Spain experienced increases in overall till takings of 0.2%, 0.6% and 0.7% respectively.
In terms of prices per item, however, the UK and Germany were the only countries in the big five where the price people paid increased, at 0.7% and 1% respectively.
Italy, France and Spain suffered price-per-item falls with respective declines of 0.6%, 0.7% and 1.4%.
This measure takes into account price inflation but also substitutions – for example, of own brand for a named brand.
The UK suffered the greatest fall in volumes sold, down 2.5%. Italy was off 0.6% and Germany, off 0.8%.
Volumes in France climbed 1.3%, and in Spain by 2.1%.
Jean-Jacques Vandenheede, Nielsen’s European director of retail insights, said the annual increase in prices paid for FMCG goods across 21 European markets as a result of both price inflation and shoppers switching between different-value items had dropped below 2% for the first time since 2010.
“The fall can be attributed to a decline in the prices being paid in the big five western European markets between Q2 and Q3. What’s more, France, Italy and Spain have actually experienced deflation,” he said.
Mike Watkins, Nielsen’s UK head of retailer and business insight, added that slowing inflation was much more apparent in the UK than across Europe as a whole.
“This is primarily due to supermarkets adjusting pricing strategies in response to falling sales volumes and the growth of the discounters, which enjoyed 19% FMCG sales growth in Q3.
“Furthermore, this is compounded by food inflation in supermarkets reaching an eight-year low and remaining below the Consumer Price Index for the last six months,” he said.