Sinking supermarkets: Should investors steer clear?

Sinking supermarkets: Should investors steer clear?

The supermarket sector is going through its biggest transformation for decades, and the ‘big four' are feeling the pinch significantly. Annabelle Williams analyses where they are going wrong, and what the future holds for investors in food retailers.

UK supermarkets were once considered national treasures by investors and the business community alike. Over the past two decades, Tesco, Sainsbury’s, Morrisons, and Asda – the ‘big four’ as they are known – have managed to radically change the food retail landscape. About £1 in every £8 spent in the UK goes into a Tesco till, and the out-of-town superstore model has had a profound effect on local high streets across the country. Such were the achievements of the supermarkets that Morrisons’ founder, Ken Morrison, was knighted in 2000 and Tesco’s former chief executive, Terry Leahy, fo...