According to a report from GlobalData – titled ‘UK Discounters 2017-2022’ – discount retailers could gain an extra £9bn slice of the total retail market as such stores become an even more appealing destination for cash-strapped shoppers.
Aldi, Lidl and B&M Bargains dominate the channel, with a combined share of over 70% of the discount retail market. DIY & gardening, health & beauty and homewares are expected to deliver the strongest category growth. B&M now has 118 garden centres in stores.
GlobalData’s research shows that 89.4% of the UK population have shopped at a discounter in the last 12 months.
Molly Johnson-Jones, food & grocery (F&G) analyst said: "Our report findings confirm that discounters have done an exceptional job in gaining market share of frequently purchased items by changing the perception of discounter own label products in F&G while at the same time undercutting mainstream retailers on branded items in H&B and household. This combined approach has proven to be very disruptive in the market and has contributed to their success.’’
Food & grocery is the sector with the highest market value, worth £15.7bn in 2017. GlobalData expects this to grow to £21.8bn by 2022.
DIY & gardening and homewares are forecast to grow 46.6% and 42.6% respectively for the period 2017-2022, as discount retailers gain market share from mainstream DIY retailers by offering consumers lower cost solutions for household maintenance and upgrades. Indeed the roll-out of larger out-of-town store formats has facilitated broader ranges, providing them with more authority in the home sectors.
Johnson-Jones added: "The discounters have expanded their range in the DIY & gardening market at a time when consumers are seeking reduced cost solutions for doing up their homes and gardens – B&M will particularly outperform in this area as it adds garden centres to its retail estate over the next few years."