There was much navel-gazing among the City's scribblers last week as they pored over Tesco's latest sales figures, which were at the slightly lower end of forecasts.
Not by much, but it was enough to question whether Tesco's recent showing of renewed vigour was slowing down compared with its rivals Sainsbury's and Morrisons.
Like-for-like sales for the three months to November were up 2.8 per cent, rather less than analysts were hoping for – and the difference was explained away by Tesco as being due to the drop in food-price inflation.
Morgan Stanley was one house disappointed by the growth figures – particularly since Tesco has thrown so much at its Clubcard points, offering customers double discounts – and queried whether it was because the promotion isn't working or the underlying business is continuing to underperform.
I do wonder whether the truth isn't a little simpler: that shoppers are getting fed up with the poor quality of Tesco's fruit and veg when compared with, say, the more upmarket stores, such as Waitrose, which still seem to be doing well. But it could be that Tesco is being caught for being in the middle again. When the recession hit more than a year ago, Tesco saw many of its customers flee to the cheaper discount stores such as Lidl and Aldi.
Now that times have perked up a bit, and people feel, rightly or wrongly, more secure in their jobs, shoppers could be starting to treat themselves again with better-quality products from Waitrose or the growing number of farmers' markets.
Or they could be slowing down all round. Spending over this year's Christmas is forecast to fall in cash terms for the first time on record. With the budget deficit at £178bn, it's not surprising that one in three of us aims wisely to spend less than last year. They know what is waiting for them in the next.Reuse content