Sainsbury’s reports 87% online revenue surge

Sainsbury’s total sales rose by 8.5 per cent year-on-year for the three months ending 27 June, with a 87 per cent surge in online revenue.

However, the supermarket chain warned that profits could fall by more than £500 million due to the impact of the Coronavirus, although this would be “broadly offset by business rates relief and stronger grocery sales”.

Grocery sales increased 10.5 per cent, after orders rose to 650,000 per week, compared to 370,000 during the same period last year.

There was also a 7.2 per cent increase in sales from its general merchandise arm, while Argos sales were up 10.7 per cent due to a 78 per cent rise in home delivery sales, while Click and Collect sales increased by 53 per cent.

New chief executive Simon Roberts warned that the rising sales were unlikely to last and that the coming months will continue to be challenging. “A number of the decisions we have made have materially increased costs but meant that we have done the right thing for our customers and set us up well for the future.”

Analysis from Kantar called Sainsbury’s a “digital first business”, with senior vice president of retail insights Ray Gaul suggesting the retailer is now “competing on an altogether different playing field” and no longer in direct competition with the UK’s Big Four supermarkets.

Kantar praised its bold renovation plans before and during the COVID-19 crisis.

“The renovation can be likened to attempting to build a new home ground,” Gaul said. “The new Sainsbury's stadium embraces the motto - fast, friendly and convenient - it is coming to life in large scale with over 1,000 store projects completed each year.”

The supermarket's centrepiece innovation, Smartshop, a handheld personalised digital app that speeds shopper journeys, is now used in over 37 per cent of all transactions.

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