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Record sales for UK supermarkets

Sainsbury’s booked a fall in sales last month for the fifth straight quarter as the UK’s supermarket price war further erodes profit margins.

The covid-19 outbreak sparked the busiest month on record for UK supermarkets, with grocery sales in March soaring by 20.6% compared to the previous month. All 10 major UK supermarkets recorded sales increases during the first 3 months of 2020, according to the new data. Aldi reported an 11% rise in sales. Of the Big-4 supermarkets, Sainsbury’s performed best, with 7.4% growth. The UK’s second-largest supermarket, Sainsbury, is likely to see a further boost to its sales over the coming months following an agreement with WHSmith to sell over 90 new product lines in WHSmith hospital stores. These products will mostly consist of essentials such as toilet roll, pasta and UHT milk.

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Morrisons teams up with Deliveroo for contact-free delivery

To help UK consumers cope with the current lockdown, retailer Morrisons has partnered with Deliveroo to offer on-demand delivery in 30 minutes to families struggling to secure delivery slots. The partnership is aimed at expanding delivery capabilities, with Morrisons now offering 70 “essential household” items via the Deliveroo app. The service is available from over 130 Morrisons stores across the UK on new £35 lockdown food boxes

Morrisons chief executive, David Potts said, “Our partnership with Deliveroo will help us to continue to play our full part in feeding the nation. It’s a great combination of traditional and modern methods and it will provide more vulnerable people with the opportunity to receive their home delivery.”

Last week, Morrisons announced a similar partnership with DPD to provide next-day delivery of its £35 food boxes. The Meat Eaters Food Box and a Vegetarian Food Box contain enough chilled, fresh and tinned food items to feed a couple for up to a week. Over 200,000 orders have been fulfilled since the partnership was announced.

Deliveroo announced a similar partnership this week with McColl’s to offer “contact free” delivery from over 120 stores.

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A first store for The Food Warehouse in Northern Ireland

Photo credit: www.newtownabbeytoday.co.uk /// Article source: Retail Gazette

The Food Warehouse has entered Northern Ireland for the first time with the opening of a flagship in County Antrim that has created 30 new jobs.

Located in Longwood Retail Park, Newtownabbey, parent company Iceland invested close to £1 million for the new 9500sq ft store.

It is also the 121st store opened in The Food Warehouse’s six-year history.

The Newtownabbey store will continue The Food Warehouse’s mission to offer shoppers a wholesale grocery store without the need for membership, in an open plan, easy-to-shop environment.

“Since the first door opened back in 2014, The Food Warehouse has grown from strength to strength, exceeding our expectation,” Iceland managing director Richard Walker said.

“Moving into Northern Ireland is a huge landmark for the business, as it continues to perform extremely well.

“We’re proud to work with local suppliers in Northern Ireland across our fresh, frozen and grocery products.”

Fresh, frozen and ambient food deals are available across more than 3000 product lines in each Food Warehouse store, as well as “When it’s Gone, it’s Gone” deals and homeware items.

“It’s incredibly important to innovate and understand what their customers want, which is how The Food Warehouse came to be,” Walker said.

“As the future of the high street remains uncertain and more and more bricks-and-mortar stores lie empty, there’s a responsibility to the government, but also retailer, to rethink how they operate in the increasingly competitive grocery retail sector.”

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Tesco expands home delivery services to meet surge in demand

UK retailer Tesco has expanded its home delivery and click-and-collect services following a sharp increase in demand that led to shoppers reporting difficulties in securing online delivery slots. The firm’s delivery and collection capacity has risen from 660,000 to around 780,000 in the past two weeks, with plans to increase this by another 100,000 in the coming weeks. Tesco has also added over 200 new vans and recruited another 2,500 drivers and over 5,000 pickers, as part of the delivery expansion.

Last week, Tesco said it was limiting shoppers to only 80 items per online order. Tesco chief executive Dave Lewis said the Covid-19 pandemic has “led to unprecedented levels of demand for grocery shopping services. We’re doing everything we can to increase the number of slots available and to support vulnerable people.”

Meanwhile, online grocer Ocado announced it was recruiting an extra 3,000 staff to work in its logistics division to meet the current surge in demand.

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Aldi eases rationing of products

Aldi’s banana price cut denounced

Aldi UK has announced that it is to relax shopping restrictions for a series of products that were previously being rationed at its UK stores. The discounter, which has recorded an 11% jump in sales in the past month, had limited customers to four of every product after panic-buying in response to the coronavirus pandemic. Products such as fresh fruit and vegetables and meat will no longer be rationed for shoppers. However, Aldi customers will continue to be limited to only two of its most popular items, which include antibacterial hand gel, UHT milk and baby formula. Meanwhile, other popular items such as nappies, bleach, toilet roll, pasta, tinned tomatoes, beer and hand wash will be limited to four items per person. 

A statement from the German retailer said: “While we would still encourage people to buy only what they need, product availability in store is good and the move will make it easier for people to shop for vulnerable people and those who are self-isolating.”

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Departure of Sainsbury’s CEO “not due” to Asda deal collapse

Departure of Sainsbury’s CEO “not due” to Asda deal collapse
Credit: Peter Nicholls, Reuters, The Times

 

Sainsbury’s CEO, Mike Coupe, has announced his resignation but will remain in his post until the end of May. His replacement will be current retail and operations director, Simon Roberts. Coupe has denied that his resignation is linked with the collapse of the £12 billion merger with Asda, emphasising that it was his own decision to leave. 

Sainsbury’s proposed merger with Asda fell through last year when the CMA found that the deal could lead to higher prices for customers. Speaking to the BBC, Coupe said, “If you looked at our AGM last year, 99.5% of our shareholders voted for me to carry on what I’m doing. It’s absolutely my choice You see the amount of change that is going on in the world of retail, who knows what will happen in the next five to 10 years, but one way or another there will be a significant rationalisation of brands you have taken for granted for a generation.”

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Marks & Spencer extends network of in-store farms

Marks & Spencer extends network of in-store farms, credit. Thomas Samson, AFP
© Thomas Samson, AFP

 

UK retailer Marks & Spencer have extended their indoor farms to six other stores in London. In partnership with vertical farming specialist, Infarm, M&S has installed hydroponic indoor units that incorporate machine learning, Internet of Things technology, and eco-controlled systems to ensure the optimum amount of light, air and nutrients are used. Growing a selection of herbs, each unit can be controlled remotely via a cloud-based platform, which learns, adjusts and continually improves to ensure each plant grows better than the last one.

Infarm’s solutions offer environmental benefits, as each unit consumes 95% less water and 75% less fertiliser than soil-based agriculture. Each unit produces the equivalent size crop to 400 square metres of farmland, with absolutely no pesticide use. M&S has announced that it plans to continue rolling out in-store farms over the coming months.

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Sainsbury’s to top Tesco with Asda merger

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Sainsbury’s says its proposed merger with fellow UK retailer Asda would see prices drop by about 10% on many products and create “significant opportunities” for suppliers.
Based on their current shares of Britain’s grocery market, a merger between the second and third biggest supermarket groups would give the new business a 31.4% slice, overtaking long-time leader Tesco’s 27.6%.

In an April 30 press release, J Sainsbury plc said there are no plans for store closures as a result of the move and both the Sainsbury’s and Asda brands would be maintained and their distinctive customer propositions sharpened. However, Sainsbury’s CEO Mike Coupe later said some stores might be sold to other grocers if required by competition regulators. He hopes the deal will go through by the second half of 2019 and said it would benefit customers, staff, suppliers and shareholders.

The plan would create one of the UK’s leading grocery, general merchandise and clothing retail groups with a network totalling more than 2,800 Sainsbury’s, Asda and Argos stores and 47 million customer transactions a week. In the latest financial year, the revenue of the two companies together totalled about £51 billion.

source: Sainsbury’s (L-R: Sainsbury’s CEO Mike Coupe, Walmart International CEO Judith McKenna, Asda CEO Roger Burnley)

“The retail sector is going through significant and rapid change, as customer shopping habits continue to evolve. This has led to increased competition across grocery, general merchandise and clothing, as customers seek ever greater value, choice and convenience. Bringing Sainsbury’s and Asda together will result in a more competitive and more resilient business that will be better able to invest in price, quality, range and the technology to create more flexible ways for customers to shop,” Sainsbury’s said in the release.

Under the deal – which values Asda at about £7.3 billion – Sainsbury’s said it would give US retail giant and Asda-owner Walmart a 42% stake in the new, combined business and nearly £3 billion in cash. Walmart would not hold more than 29.9% of the total voting rights for the new group.

Analysts predicted the proposal would trigger a major competition inquiry and, if approved, result in some store disposals to ensure competition did not suffer. The plan was variously described in UK media as “the biggest shake-up in the market since Morrison bought Safeway in 2003” and a seismic shift which will transform the UK retail landscape. There were also reports of fears of job losses and that suppliers, particularly small ones, could be squeezed on prices.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said it was a pivotal moment for the British grocery market, one in which the German discounters Lidl and Aldi continue to enjoy strong growth. He also pointed out that Sainsbury’s and Asda supermarkets appeal to different customer bases. Asda achieves nearly two-thirds of its sales outside London and the south east of England in contrast to Sainsbury’s, which registers 59% of its sales in those two areas.  Sainsbury’s also appeals to more affluent shoppers, he said.

sources include:
Sainsbury’s press release
Kantar Worldpanel news

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Health driving UK food trends

Health is Brits’ top priority: popularity of vegan cheese, venison and turmeric soars

The free-from phenomenon was one of the biggest food trends of 2016 in the UK, reports Sainsbury’s.

The UK supermarket chain said sales in what was once a niche market grew over 18% and it is now a £770 million (€900m) industry.

One of the most popular free-from items sold by Sainsbury’s was vegan cheese. Its seven varieties of cheese alternatives exceeded sales expectations by 300% in the first month after the September launch.

“The line was developed following research indicating that the most longed-for dishes for shoppers with allergies and intolerances included pizza, cheese boards and cheesecake,” it said.

Other trends included exponential growth in sales of venison, which is low in fat, high in protein and rich in minerals, making it a good alternative to other red meats.

Turmeric and coffee sales were also up in 2016, something Sainsbury’s said might be due to the popularity of turmeric lattes – coffee blended with almond milk and the super food spice. Sales of fresh turmeric root saw a 45% uplift.

Source: Sainsbury’s

(Free-from foods usually refer to those that are targeted at consumers who suffer from food intolerances and/or food allergies.)

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Sainsbury’s on its support for sustainable agriculture in Peruvian desert

Sainsbury’s Supports Sustainable Agriculture In The Peruvian Desert

UK supermarket chain Sainsbury’s has higlighted in a recent blog post that as you walk through its aisles you might be surprised to find that some of its products – including asparagus, peas, beans and grapes – come from one of the world’s oldest, driest deserts in southern Peru.

“While it might sound unusual, the results are some of the successes from our partnership with Kew Royal Botanic Gardens, a world famous center for botanical and mycological knowledge, as we develop the idea of ‘conservation through use’.

“We’re really proud of our work around this idea, which helps return native and threatened species to otherwise arid areas, introducing them into schools and communities to ensure sustainable, effective growing. Now two years in it’s proven really successful, not only improving farming, but integrating and maintaining delicate ecosystems to build a sustainable future for local people.

“For example, we’ve been able to introduce nitrogen-fixing trees, like Acacia species, to sufficiently improve the soil quality to grow everything from maize and Lima beans, through to guavas and cottons.

“Thanks to its success, we’ve already seen attention from across Peru and the whole community is keen to make this work. That’s why we’re delighted to say that, thanks to support from Sainsbury’s, Kew has established the first Native Plant Research and Conservation Centre. This facility is developing native seed management and propagation protocols for rare native plants at large scale, and is currently acting as a training hub and a much-needed community resource.”

The retailer said that at the heart of this lies its commitment to ensuring that its sourcing “does not have a negative impact on the local environment or communities,”

Whether it’s asparagus or guava in your basket, you’ll know that the items you buy help promote sustainable farming for local communities abroad, Sainsbury’s said.

source: Sainsbury’s blog