Tesco sales decline amid cost-of-living crisis

UK sales at Tesco have decreased by 1.5 per cent in the first quarter of the year, as the company’s chief executive warns of an “incredibly challenging” market environment.

The supermarket boss said that the company is beginning to see changes in customer behaviour due to inflation.

Compared to pre-pandemic levels, sales were up by 8.1 per cent in the UK.

Despite the year-on-year decrease in sales, the company’s profit guidance for the 2022 financial year remains the same.

“Although difficult to separate from the significant impact of lapping last year’s lockdowns, we are seeing some early indications of changing customer behaviour as a result of the inflationary environment,” said Ken Murphy, chief executive, Tesco. “Customers are facing unprecedented increases in the cost of living and it is therefore even more important that we work with our supplier partners to mitigate as much inflation as possible.”

Tesco joins a long list of UK retailers that have been impacted by rising inflation.

Yesterday online fashion brands ASOS and boohoo revealed a fall in sales driven by inflationary pressures and a hike in returns.

ASOS chief operating officer Mat Dun also said that inflationary pressure is “increasingly impacting” customer shopping behaviour.

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