Coles sees sales rise due to Little Shop promotion

Coles Supermarket Australia has placed ahead of its rival retailer, Woolworths, in regards to sales for the first time in two years.

The Melbourne-based supermarket saw its sales rise by 5% during the first quarter compared to the previous year.

“This has come at the expense of Woolworths, where sales growth is likely to moderate to 1.5 per cent,” stated the investment bank, Citi, according to the West Australia.

The rise in sales has been attributed to Coles’ Little Shop promotion, in which its customers are collecting miniatures of products in the store.

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The eight-week promotion is anticipated to have generated almost $200mn in sales for the supermarket, with sales growth rising from 2% before the promotion period to 6.2% during it.

The promotion is also expected to have boosted profits before interest and tax by $11mn.

“Coles’ Little Shop campaign exceeded even our optimistic expectations,” Citi continued.

The supermarket’s decision to extend the phase-out of plastic bags also contributed to the successful quarter.