Blog: Dean BestCo-op to Casino: food retail on both sides of the Channel

Dean Best | 12 October 2009

Look away from last week's much-hyped “row” between the chief executives of UK retailers Tesco and Sainsbury's. A much more significant development is gathering steam in the country's grocery sector – the rise of The Co-operative Group.

The retailer's buoyant half-year numbers – issued this morning (12 October) and including “market-beating” like-for-like sales growth of 7.3% – adds further support to those who see the UK food retail landscape as housing a Big Five rather than a Big Four.

According to the most recent figures from TNS, the Co-op accounts for 5.5% of UK grocery retail sales. Including sales from stores still under the Somerfield banner takes the Co-op's market share to 8.2%, with Morrisons, the UK's number four food retailer, generating 11.3% of the country's grocery sales.

The Co-op is still busy integrating the Somerfield stores into its business some 15 months after it announced the GBP1.6bn (US$2.53bn) takeover. However, to achieve such robust sales – and a 17% rise in underlying profits – while incorporating a national food retailer into a business is no mean feat. It seems that amid the integration, the Co-op, led by chief executive and amateur drummer Peter Marks, is still striking the right note with consumers.

Across the Channel, however, a couple of France's leading food retailers seem to be struggling with a lacklustre domestic market. Later this week, Carrefour and Casino both publish their latest quarterly numbers and analysts have predicted that weakness at home will offset stronger performances overseas.

Both retailers are expected to see domestic sales fall on the back of falling food inflation and still low consumer confidence in France. And analysts believe problems at home will mask both Carrefour and Casino's relative strength overseas.

That said, both retailers have found their non-French businesses in the news in recent days. Last week, Carrefour, normally so loathe to make public statements outside of M&A or results, issued a short statement in a bid to quash speculation that it could be looking to quit emerging markets like China or Brazil.

Casino, meanwhile, seems all the more likely to be able to quit a market that has caused problems for the business. The race for Dutch retailer Super de Boer – in which Casino owns a 57% stake – is hotting up, with two rival camps jostling for the business. Casino is currently in talks with Dutch supermarket Jumbo, one of the lead bidders, but the French retailer looks set to win, whoever prevails in the takeover battle. As one analyst told us last week: “Casino are relieved that someone is going to take that off their hands.”


BLOG

Will Amazon Go be retail "game-changer"?

Ask any FMCG executive to list the trends shaking up the sector and digital and e-commerce will be pretty high on the list. Drill down into that and Amazon will be one of the subjects in the digital s...

BLOG

UK food producers call for "best possible single market access" post-Brexit

Since Theresa May took over as UK Prime Minister in the wake of the country's referendum vote to quit the European Union, she and her ministers have been at pains not to divulge their negotiating posi...

BLOG

Greenpeace trains sights on Sainsbury's over John West tuna

Greenpeace's long-running campaign against UK tuna brand John West, owned by seafood giant Thai Union, is now directing its fire against Sainsbury's....

just-food homepage



Forgot your password?