Sainsbury’s boss has called for interest rate cuts to kick-start consumer spending as strong supermarket sales were hit by woes at Argos.
Simon Roberts said ‘customers are continuing to be cautious’.
He added: ‘Until we see sequential interest rate cuts, hopefully as soon as possible, that caution from consumers is going to continue on those more discretionary items.’
Hesitancy from shoppers to spend on non-essentials contributed to a 6.2% fall in sales at Argos in the 16 weeks to June 22 compared to last year
There are hopes of an interest rate cut this summer.
Hesitancy from shoppers to spend on non-essentials contributed to a 6.2 per cent fall in sales at Argos in the 16 weeks to June 22 compared to last year.
Sainsbury’s – Britain’s second biggest supermarket – also blamed an ‘unseasonal start to summer’ that deterred Brits from buying products from its home, garden and outdoor furniture departments.
But when the sun came out last week, it sold more fans than it had done all year.
Argos has been an area of concern for a while, recording a 4.7 per cent fall in sales in the previous quarter.
Sophie Lund-Yates, an analyst at Hargreaves Lansdown, described it as ‘an albatross around [Sainsbury’s] neck’ that ‘can’t be ignored’.
Its dismal sales came in contrast to 4.8 per cent higher grocery sales as Roberts said its food arm was ‘going from strength to strength’.
This helped overall like-for-like sales, excluding fuel, to rise 3 per cent.
It has been gaining market share for 15 months in a row. It holds 15.2 per cent of the sector, placing it second behind Tesco.
Speaking days before the election, Roberts took the opportunity to ask the next government to reform business rates saying it is ‘absolutely essential to grow our economy’.
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