British grocery chain Tesco saw online sales jump 48% in the three months to May. It has been the 'port of call' for many UK customers during the pandemic, one analyst said.

Nick Potts – PA Images/GettyTesco delivered a strong fist-quarter by posting a 48% jump in UK online sales.
  • Tesco, the UK’s largest grocery store chain, doubled its online capacity to meet soaring consumer demand during the peak of the pandemic.
  • It reported a 48% jump in first-quarter online sales. The retailer said it had increased orders per week to 1.3 million, from 600,000 in the same period last year.
  • “Consumers have shifted spend to supermarkets at an unprecedented level over the past three months, and, with its national prominence, Tesco has been the first port of call for many,” a retail analyst at GlobalData said.
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British supermarket Tesco posted a 48% jump in UK online sales over the three months to May, and doubled its online capacity over the same period.

It received 1.3 million orders per week over the quarter, compared to 600,000 over the same period last year.

In May alone, Tesco’s online sales surged by more 90%.

“In just five weeks, we doubled our online capacity to help support our most vulnerable customers and transformed our stores with extensive social distancing measures,” chief executive Dave Lewis said in a press release.

However, the retailer said it faced signifcant costs associated with the growth of its online business, and that these were only partly offset by business rates relief and increased sales.

Tesco also presented a first-quarter online market share of 33.5%. Ocado Plc, its main competitor, was at 15.7%.

As consumer spending shifted to supermarkets, Tesco was the “port of call” for many, said Thomas Brereton, a retail analyst at GlobalData. “Tesco appears to be gearing up for an all-out price war with the discounters that have eaten away at its market share over the past decade.

Prior to COVID-19, the retailer had developed its supply chain to give it a competitive edge against peers, who prioritised investment in other areas, Brereton said.

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