Sainsbury's has warned it expects the market to 'remain challenging for the foreseeable future' after reporting a drop in like-for-like sales for a fifth consecutive quarter.
It said sales at stores open at least a year fell 1.9 per cent - excluding fuel - in the 10 weeks to 14 March.
Total sales fell 0.3 per cent as price cuts and food deflation both affected trading.
Sainsbury's said the drop in sales reflected decisions the group had taken to improve its competitiveness.
David Tyler, Sainsbury's chairman, said: “The UK grocery sector has become increasingly challenging in recent months.
'As a result, we have evolved our strategy and believe this will allow us to build on our heritage and past success, especially as it will be delivered by the most experienced management team in the industry.'
David Gray, a retail analyst at Planet Retail, isn't so optimistic.
He said: “As per expectation, Sainsbury’s like-for-like numbers are now converging with its competitors with Q4 delivering another decline. This shows that even the former golden child of UK grocery is not immune to the double whammy of industry-wide sagging food volumes and price stagnation – a potent brew which is proving deadly to mainstream operators.
“With Tesco showing tentative signs of being ready to embark on the long slog to recovery, the challenges for Sainsbury’s will grow more daunting. The threat of more Tesco price investments is lurking in the background; something that could trigger a lengthy flatlining of food prices industry-wide.
“Although these figures are disappointing at best, Sainsbury’s still possesses some strengths, most notably in convenience where it continues to add one to two stores per week. Like-for-like performance is considerably better in convenience than big-box, though its growth this time around was insufficient to offset declines elsewhere.'
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