Tesco sees record Christmas sales as shoppers ‘treat themselves’

Tesco saw “record” sales over Christmas as customers spoiled themselves in lockdown with online orders of deluxe range products. 

UK like-for-like sales were up 8.1% in the six weeks to 9 January as the supermarket saw a 14% jump in demand for goods in its Tesco Finest range.

Sales of vegan Christmas alternatives also surged, it added.

Big grocers have benefited at a time when non-essential shops and restaurants are closed due to Covid.

Tesco said customers had “looked for more opportunities to treat themselves” as the UK faced strict restrictions over Christmas.

New boss Ken Murphy said: “We delivered a record Christmas across all of our formats and channels. 

“In response to unprecedented demand for online groceries, colleagues delivered over seven million orders containing more than 400 million individual items over the Christmas period.” 

Like other grocers, Tesco has seen strong online sales growth as people try to avoid shopping in physical stores where they can. 

It said its online sales were up 80% in the 19 weeks to 9 January, equating to nearly £1bn in extra sales.

Cutting down on plastic

The retailer said it offered its largest ever festive range of free-from, vegan and vegetarian products this year, with sales of plant-based products increasing strongly. 

It also hit a target of removing one billion pieces of plastic from products sold in the UK, including shrink wrap from multipacks, covers from greeting cards and plastic gifts from Christmas crackers.

Glasses of pink prosecco
image captionConsumers splashed out on products such as pink prosecco over the festive period

Supermarkets have enjoyed bumper sales during the pandemic as people try to make up for not being able to go out and spend more on their weekly shop. 

But they have face criticism too.

Last month, Tesco said it would repay £585m of business rates relief after it was criticised for paying dividends to shareholders during the crisis. Most big grocers followed suit.

Tesco was later criticised for keeping its shops open on Boxing Day despite union calls to give staff the day off.

In its results the grocer said it had given all frontline staff a 10% bonus over Christmas. It also said it had shielded vulnerable staff and taken on nearly 35,000 additional temporary staff for the season.

“Our colleagues went above and beyond, rising to every challenge in the most exceptional of circumstances and I thank every one of them for this,” said Mr Murphy. 

In other retail news:

  • Primark owner Associated British Foods has warned that the fashion chain could lose more than £1bn-worth of sales if the current store closures under lockdown continue until the end of February. At the moment, 305 of its 389 global stores are closed – including all 190 of its UK stores – representing 76% of its retail selling space.
  • Halfords said it had seen its “best ever Christmas week” during festive trading. Sales of bikes, e-bikes and e-scooters did well in particular, with a 35.4% uplift in like-for-like sales seen in the 13 weeks to 1 January from a year ago. Although motoring sales fell as a result of lockdowns, sales across the group were up 11.5%. The chain has been allowed to stay open during lockdowns as it is classified as an essential retailer.
  • Online fashion retailer Boohoo said it saw “strong” sales growth of 40% in the last four months of 2020, with revenues hitting £660.8m over the period. The company has also raised its revenue growth forecast for the year to 28 February to 36-38%, up from its previous guidance of 28-32%.