Morrisons Expresses Alertness to Middle East Conflict Effects on Operations and Shoppers
Supermarket giant Morrisons has stated it is "alert" to the potential impacts of the Iran war on consumer confidence and its supply chain, despite reporting stronger sales in recent months. The Bradford-based retailer emphasized that economic conditions remain "tough for customers right now," pledging further investment in pricing to support shoppers during this challenging period.
Sales Growth Amidst Competitive and Geopolitical Pressures
Morrisons revealed that total sales increased by 2.6% to £4.1 billion for the 13 weeks ending January 25, compared to the same period last year. Group like-for-like sales also rose by 2.8% year-on-year, driven largely by a "much-improved Christmas" performance. The company attributed sales volume growth to its investment in lower prices, as it navigates intense competition within the UK grocery sector.
Chief Executive Rami Baitieh highlighted the company's vigilance, stating: "We are watching current international events closely, alert to the impacts on consumer confidence and supply chains, and we will continue to do what we can to mitigate effects on our customers." He noted that the business is actively assessing how shopping habits and product supply might be influenced by the ongoing conflict in the Middle East.
Strategic Responses to Market Challenges
Under Mr. Baitieh's leadership, Morrisons has been implementing strategies to counteract pressure from discount rivals such as Aldi and Lidl, as well as price-focused approaches from major competitors including Tesco, Sainsbury's, and Asda. The retailer reported achieving £49 million in cost savings during the quarter as part of an ongoing transformation programme.
Mr. Baitieh elaborated on the company's approach: "Against a highly competitive backdrop, with grocery market growth lagging previous expectations, we achieved our targets in Q1, delivering our 13th quarter of like-for-like sales growth. We know it’s tough for customers right now and we’re doing everything we can to offer them better value and give them more reasons to shop at Morrisons."
He further committed to continuing investments in price, promotions, and loyalty programmes, focusing on delivering value where it matters most for customers. This comes in the context of earlier warnings to staff about limited pay rises due to rising costs, underscoring the broader economic pressures facing the retailer.
