Lidl Overtakes Morrisons in UK Grocery Market
Lidl, the German-owned discount supermarket, has become the UK’s fifth largest grocer, driven by households aiming to manage their weekly expenses more effectively.
The discounter recorded an 8.8% year-on-year increase in sales, making it the fastest-growing store-based grocer. This growth resulted in a record market share of 8.6% over the 12 weeks ending 17 May, according to data from market analysts Worldpanel by Numerator. In comparison, Morrisons held an 8.3% market share during the same period, with sales rising by only 1.3% year-on-year.
Twenty-five years ago, Lidl accounted for just 1.4% of the grocery market, trailing behind now-defunct chains such as Safeway, Somerfield, and Kwik Save. Since then, Lidl has rapidly expanded its store network and broadened its appeal, evolving into a preferred destination for weekly shopping.
Expansion and Financial Performance
Since its UK establishment in 1994, Lidl GB has grown to 1,000 stores and 13 distribution centres, employing 35,000 people across England, Scotland, and Wales. In the year ending February 2025, Lidl GB’s sales increased by 8.3% to £11.7 billion, while profits more than doubled to £156.8 million.
In April, Lidl announced plans to invest over £600 million in further expansion within the UK.
Lidl now ranks just behind Aldi, another German-owned discount chain, which is the UK’s fourth largest supermarket. Aldi’s market share is less than one percentage point behind Asda, a supermarket currently experiencing declining sales despite ongoing turnaround efforts.
Market Dynamics and Competition
The rapid growth of Aldi and Lidl has been partly attributed to the underperformance of Asda and Morrisons, both of which have been affected by debt-laden private equity takeovers.
However, Aldi’s growth has recently slowed as Tesco and Sainsbury’s, the UK’s largest and second-largest supermarket chains respectively, have responded with loyalty programs and competitive pricing strategies that closely match those of the discount retailers.
Leadership Perspective
Ryan McDonnell, Chief Executive of Lidl GB, commented on the milestone:
“Becoming Great Britain’s fifth‑largest supermarket is a significant milestone and a clear indication of the momentum we have built. As customer expectations shift, households are looking for value they can rely on without compromising on quality, and we remain laser-focused on delivering exactly that.
Achieving this is a testament to the dedication of our colleagues, whose hard work delivers for our customers every single day.”
Consumer Behavior and Inflation Impact
The rise of discount supermarkets corresponds with consumers increasingly turning to budget chains and promotions to offset inflationary pressures on food and energy bills.
Like-for-like grocery prices increased by 3.1% in the four weeks to 17 May, marking the slowest inflation rate since December 2024. This slowdown is attributed to supermarkets offering discounts to encourage spending, according to Worldpanel.
Consumers relied heavily on promotions to manage costs, with spending on promoted items rising 9.5% year-on-year, while spending on full-price items remained nearly flat, growing by only 0.1%.
Fraser McKevitt, Head of Retail and Consumer Insight at Worldpanel, noted:
“The easing in the rate of inflation is welcome news for shoppers who have been grappling with warnings of a hike in food prices due to the impact of the war in the Middle East.”
