Bulletin

Supermarkets in festive sales flop

Tesco, Sainsbury's and Marks & Spencer are all expected to report a fall in Christmas sales when they update this week, illustrating pressures faced by the grocery sector. Sainsbury's is expected to post a fall in like-for-like sales of 1.8% for the Christmas period, and a fall of about 4% for the three months to Christmas. Analysts expect Tesco to unveil a 3% to 4% fall in quarterly like-for-like sales. M&S is forecast to have seen a 0.9% rise in like-for-like food sales over Christmas, but its general sales are expected to be down 3% over the last quarter. Tesco is expected to announce a major overhaul of its supplier terms on Thursday. Chief executive Dave Lewis is forecast to introduce a simple scheme based on sales volumes in place of Tesco's existing system of supplier rebates and penalty fees. Tesco is also poised to announce a deal to sell its BlinkBox film and TV service to TalkTalk, with sources close to talks hopeful of a sale announcement this week. Separately, The Department for Business is proposing new rules to require large companies to provide updates on their dealings with suppliers every quarter. Companies will be required to state the time taken to pay suppliers and disclose any changes to supplier terms. The new rules could come into force this year.

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