UK food retailer Sainsbury’s should focus on its existing customer base rather than throwing its weight behind trying to win new customers, said analysts at the HSBC Investment Bank.

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It is also unlikely to expand its store portfolio in Northern Ireland, where it has just seven stores.

“Sainsbury’s has been moving away from being a big national brand chain towards a more niche foodie market,” analysts told the Irish Times newspaper, adding that the group’s key regional focus is likely to be the affluent south and south east of England, already its primary customer base.

Addressing the issue of whether Sainsbury would to expand its Northern Irish activities to take on Tesco, which has 36 stores, and Safeway, which has made inroads into the market with 12 stores, analysts said it was unlikely. It would be hard to achieve critical mass in a market in which Tesco has already developed a dominant position.

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