Sales of Tesco's upmarket Finest range have jumped 18% in the first quarter, helping lift overall UK like-for-like sales by 5.1% in the 13 weeks to 24 May. Analysts attribute the surge to a home-dining boom driven by high restaurant prices, as households opt for premium supermarket offerings instead of eating out.
The UK's biggest supermarket also grew its market share during the period, fending off competition from discount rivals Aldi and Lidl. Tesco's chief executive, Ken Murphy, said the chain had matched prices on more than 600 items with Aldi to attract customers.
Retail analysts highlighted the success of Tesco's own-brand strategy. Dan Lane of Robinhood UK called the Finest range “something of a secret weapon” for enticing cash-strapped shoppers. “Shoppers looking to trade down from increasingly expensive restaurants are opting for the premium offering at home instead,” he said.
Clive Black of Shore Capital noted that a family dinner out can cost £100, while supermarket alternatives offer better value. This trend has also benefited premium private-label lines at M&S and Sainsbury's. Meanwhile, grocery price inflation rose to 4.1% in May, pushing more shoppers toward own-label products.
Tesco faces continued pressure to maintain its dominant position. Russ Mould of AJ Bell warned: “The moment Tesco relaxes is the point at which rival operators pounce on the opportunity to eat some of its lunch.”
