The Safeway own-label was phased out by Morrisons when the company acquired the namesake food retailer in 2004. Most of Safeway’s 470-plus stores were rebranded as Morrisons, with others sold off.
Morrisons has been developing a new Safeway range since the end of last year. The line now comprises over 400 fresh, frozen and ambient foods, many of which are made in Morrisons’ food manufacturing sites. McColl’s is to be given a one-year period of exclusive access to Safeway products.
In a stock exchange announcement this morning, Morrisons, which will become the sole wholesale supplier to McColl’s “in time”, said it will distribute Safeway products and national brands to the c-store group.
The supplies will start on a phased basis from January. Under the terms of the deal, Morrisons will initially supply around 1,000 McColl’s convenience shops and 350 newsagents. Around 300 convenience shops acquired by McColl’s will “migrate in due course”, Morrisons said.
Morrisons chief executive David Potts said: “We are very pleased to partner with McColl’s, and look forward to developing a long and successful relationship together. We are also pleased to be reviving the Safeway brand which we know customers will enjoy. This new partnership is a further example of Morrisons leveraging existing assets to access the UK’s growing convenience food market in a capital light way. Wholesale supply will help make us a broader, stronger business.”
As well as being the UK’s fourth-largest food retailer, Morrisons is also a significant food manufacturer. Jonathan Miller, the chief executive of McColl’s, said: “In McColl’s, Morrisons gain a long-term partner of significant scale with a growing neighbourhood convenience estate and in Morrisons we gain access to their best-in-class sourcing and manufacturing capabilities. This will enable us to provide our customers with the highest-quality fresh food through the relaunch of the much loved and trusted Safeway brand.”