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November 11, 2019

Coles to source own-label from UK grocer Sainsbury’s

Coles, Australia's second-largest retailer, is to stock a range of own-label products supplied by a major peer in the UK.

By Dean Best

Coles, Australia’s second-largest retailer, is to stock a range of own-label products supplied by Sainsbury’s, one of the UK’s major grocers.

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  • Which industry sectors are most vulnerable to reduced consumer demand?
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  • How long will high inflation last in the UK?
  • How can your company survive and thrive in a high inflation environment?
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by GD50 Custom
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Under the terms of the deal, from early next year, Sainsbury’s will supply to Coles packaged groceries and household products that will be white-labelled under the Australian retailer’s Own Brand range.

Coles’ Own Brand portfolio comprises products sold under a variety of sub-brands such as its Nature’s Kitchen vegan items and the I’m Free From range. The retailer said it wanted to build on the growing sales of its Own Brand products.

Sainsbury’s, meanwhile, described the deal as “a key milestone” in the company’s strategy to build its wholesale business. It has partnerships already in place in Asia, Europe and the UK.

According to the latest Coles annual report, the retailer’s Own Brand sales grew by 5.9% to AUD9bn (US$6.17bn) in the company’s 2019 financial year, which ran to 30 June.

“We want to accelerate the introduction of innovative products to Coles Own Brand, and this partnership allows us to do that with a range of food and groceries that are already proven in the international market but not yet available in Australia,” Greg Davis, the chief executive of Coles’ Commercial and Express businesses, said. “This deal will free up resources for our own product development team so that they can drive further innovation and help us fulfil our strategy to make Coles an own-brand powerhouse.”

Coles said Own Brand sales account for 30% of sales in its supermarket outlets. The retailer sought to underline how “the vast majority” of its Own Brand range is “grown and made in Australia”, adding in a statement: “That will not change as we work with suppliers to add further Australian-made products to our Own Brand range.”

The retailers said they would also look at Australian products Sainsbury’s could source through Coles to potentially list in the UK. 

Michael Luck, director of business development at Sainsbury’s, said: “Great quality food, high standards and ethical sourcing are at the heart of both our businesses and we are delighted to work with Coles to bring more choice and innovation to Australian customers. We’re excited by the opportunity to offer more of our fantastic products to customers around the world through wholesale partnerships like this one.”

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Free Whitepaper
img

What is the impact of historically high inflation on the UK consumer landscape?

The average UK consumer is experiencing a severe cost-of living crisis as inflation surges to a forty-year high and the price of goods continues to rise. This shock is the result of the sharply increasing costs of commodities, energy, and the ongoing conflict in Ukraine, and is threatening FMCG manufacturers, retailers, and foodservice operators’ ability to survive and grow. Inflation will have a profound effect on many consumer-facing industries in 2022 and beyond. Consult GlobalData’s new whitepaper, Inflation in the UK: The Impact of Historically High Inflation on the UK Consumer Landscape, to better understand shifts in consumer behavior and their impact on spending patterns, as well as the implications for UK businesses. This whitepaper covers:  
  • Why has global inflation returned with a vengeance?
  • What is the current inflation situation in the UK?
  • What impact is inflation having on UK retail sales?
  • What tactics are businesses relying on to tackle the effects of high inflation?
  • How are consumers changing their behaviors to cope with the higher cost of living?
  • Which industry sectors are most vulnerable to reduced consumer demand?
  • How is the government responding to high inflation?
  • How long will high inflation last in the UK?
  • How can your company survive and thrive in a high inflation environment?
Enter your details here to receive your free whitepaper and ready your business for these increasingly uncertain times.
by GD50 Custom
Enter your details here to receive your free Whitepaper.

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