Lidl has overtaken Morrisons to become the UK's fifth largest grocer, as its sales surged ahead driven by households seeking to keep a lid on their weekly bills. The German-owned discounter increased its sales by 8.8% year on year, making it the fastest-growing store-based grocer, and achieved a record high market share of 8.6% over the 12 weeks to 17 May, according to data from market analysts Worldpanel by Numerator. In comparison, Morrisons, based in Bradford, held an 8.3% share during the same period, with sales growth of only 1.3% year on year.
Lidl's Growth Trajectory
Twenty-five years ago, Lidl accounted for only 1.4% of the grocery market, trailing behind now-defunct names such as Safeway, Somerfield, and Kwik Save. Since then, it has rapidly expanded its store network and broadened its appeal to become a weekly shopping destination. Since entering the UK 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 to February 2025, sales rose 8.3% to £11.7 billion, and profits more than doubled to £156.8 million.
Future Expansion Plans
In April, Lidl pledged to open 50 new UK stores in the coming year and invest more than £600 million in expansion. Lidl now sits behind fellow German-owned discounter Aldi, which is the UK's fourth largest supermarket. Aldi is less than one percentage point behind struggling Asda, where sales continue to decline despite turnaround efforts.
Market Dynamics
Aldi and Lidl have grown rapidly, partly benefiting from poor performance at Asda and Morrisons since both were acquired in debt-fueled private equity deals. However, Aldi's growth has recently slowed as Tesco and Sainsbury's, the UK's first and second largest chains, have countered with loyalty schemes and price-matching ranges.
Ryan McDonnell, chief executive of Lidl GB, said: "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
The rise of discounters comes as households turn to budget chains and seek promotions to offset inflation on food and energy bills. Like-for-like grocery prices rose 3.1% in the four weeks to 17 May, but this marked the slowest pace of inflation since December 2024 as supermarkets offered discounts to attract spending, Worldpanel reported. Shoppers relied on promotions to keep costs down, with spending on promoted items up 9.5% year on year, while full-price spending was virtually flat, growing by only 0.1%.
Fraser McKevitt, head of retail and consumer insight at Worldpanel, said: "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."
