UK: Shell/Sainsbury: forecourt alliance (COMMENT)
Sainsbury is to open 100 convenience stores on Shell forecourts in the next three years. With the forecourt shop segment growing even faster than the convenience market as a whole, the extension of the Sainsbury/Shell alliance represents an excellent opportunity for Sainsbury. Meanwhile, the allure of high quality grocery shopping on the forecourt is expected to drive fuel sales growth for Shell.
Having successfully trialed Sainsbury's Local store format at six Shell sites in the UK since October 2000, the supermarket giant is to open 100 new outlets within the next three years. The rollout is due to begin in the autumn, with the stores stocking the usual convenience items, plus Shell's car care and lubricant products. The rollout will involve the creation of around 2,000 jobs.
The Local format has been a successful one for Sainsbury, with Locals accounting for 11 of the company's 20 best performing stores in terms of sales per square foot. Three of the eleven are located on Shell forecourts. The addition of 100 sites will almost triple the number of sites from the current 58.
"We believe our convenience store offer is the best in the UK," said Sir Peter Davis, Sainsbury's chief executive. "By working with Shell we can bring Sainsbury's quality convenience food shopping into new areas of the UK and within easy reach of millions of new customers."
The new venture is expected to position Shell well against its rivals BP and Esso. Esso is already in an alliance with Tesco, and over the past four years oil majors have increased the number of forecourts at which there is a convenience store run by a high quality grocery retailer. This helps to attract motorists while also reflecting a consistency in brand perception.
Meanwhile, Sainsbury's rival Tesco has already upped its investment in the convenience market, recently announcing its intention to convert 450 of the 870 T&S stores it acquired in October to the Tesco Express format over the next four years. It is important for Sainsbury that it increases its Local sites and maintains pace with its competitors in what is becoming an increasingly important segment.
(c) 2003 Datamonitor. All rights reserved. Republication or redistribution, including by framing or similar means, is expressly prohibited without prior written consent. Datamonitor shall not be liable for errors or delays in the content, or for any actions taken in reliance thereon.
As the popularity of strict low-carbohydrate diets appears to be in decline, a more moderate alternative has been building in the consumer consciousness. Already popular in Australia, the Glycemic Ind...
Supermarket Tesco further increased its lead in the UK grocery market in the twelve weeks to 24 April 2005, according to market analysts TNS. Sainsbury managed a small rise, while Wal-Mart's Asda and ...
UK supermarket group J Sainsbury has announced the acquisition of SL Shaw Ltd, a neighbourhood convenience store operator with five stores in the south east of England....
Any move from Asda will be an important catalyst in the race to land Somerfield. The Wal-Mart owned group could well see its acquisition target as an important route into the ever-expanding convenienc...
Supermarket chain Tesco has announced a new food labelling system, with 'nutritional signposts,' which it says will make it easier for shoppers to make healthier choices....
Locally owned food retailer CBA is Hungary's biggest supermarket, according to the Budapest Business Journal, which cited statistics compiled by AC Nielsen for trade journal Mai Piac....
Not content with pocketing one in every three pounds spent on groceries in the UK, the supermarket giant Tesco has now become the first British retailer to smash the £2 bn ($3.78bn) profit barrier. Ho...
Tesco, the UK's biggest supermarket chain, has today (Tuesday) reported a 20.5% rise in pre-tax profits to £2.029bn (US$3.84bn) for the 52 weeks ended 26 February 2005....
- Why personalisation will take-off in US food
- US food next wave on display at Winter Fancy Food
- Column: Kraft Heinz, Unilever and sustainability
- Comment: Meal kits in US - don't believe the hype
- General Mills sales woes continue - analysis
- Unilever 'lining up spreads sale'
- UK own-label firm Park Cakes sold in MBO
- Immigration crackdown "risk" for US dairy industry
- BRF plant suspended amid bribery allegations
- Brazil giants JBS, BRF probed over alleged bribery