Peter Marks, the chief executive of UK retailer The Co-operative Group, has called its purchase of Somerfield the best acquisition the group ever made.

Speaking at the IGD Convention in London yesterday (11 October), Marks was asked whether in hindsight he would have made the acquisition, knowing the economic downturn was looming. “Unequivocally, yes” he said.

Marks went on to say that, although tougher than they had expected, the deal had “modernised” the business.

Marks also reaffirmed his belief that trading conditions in the UK retail sector were the toughest he had ever worked through. “This just feels worse than the others [recessions],” he told the audience. “It’s going on longer. It started in 2008 and still we are getting further into the mire. I don’t think I have ever seen the consumer as squeezed as this.”

He added that this was the first time in a recession that the industry had witnessed a drop in food sales volumes.

However, Marks also said: “Retailers are optimists, the economy is gloomy but you get on and adapt and we will get out it and we will come out of it in better shape.”

Marks, meanwhile, warned that the UK government was running out of the “usual economic levers to pull,” and that businesses should “grit their teeth and get used to this as the new norm for the next few years”.

But he called on the coalition to incentivise entrepreneurs by tweaking the tax system and give people the incentive to work hard and take risks.