The retailer has admitted that challenging toys sales have dented Christmas trading figures.
In its results for the 15 weeks to 6th January, Argos, part of the Sainsbury’s group, announced that sales fell 1.4%, despite a record Christmas week. It is thought firms such as Amazon are likely to have won customers from traditional retailers.
Mike Coupe, chief executive of Sainsbury’s, commented: ‘Things like games consoles did very well, probably as a substitute for toys. But we saw a little bit of pressure on toy sales which you might see reflected in the performance of some competitors.”
Record Black Friday figures at Argos did little to boost general merchandise sales. Like other supermarkets, Sainsbury’s enjoyed a boost from grocery sales, and in particular its premium Taste the Difference line.
Mike added: “We have to acknowledge that the (non-food) market is challenging and there’s certainly a little bit of a squeeze on consumer disposable income and where people are able to defer purchases, they do. We have to be slightly cautious in our outlook because it’s reflective of the current consumer environment.”
Sainsbury’s gambled on Argos in 2016, buying its 739 stores for £1.4b and opening concessions within its supermarkets. Overall sales at Sainsbury’s were lifted by a 1pc rise in clothing and a 2.3% increase in grocery sales, to see total like-for-likes up 1.2%.