The Big Food Group’s Q4 trading statement has revealed a slowing of like-for-like sales for Iceland. Iceland’s current store refit program, and BFG’s avowed desire to buy the Londis chain, underpins the transition towards convenience retailing. A successful move into this burgeoning sector will require much hard work but may prove ultimately rewarding.
Go deeper with GlobalData
The Big Food Group, owner of the Iceland chain of frozen food stores, has released its Q4 trading statement reporting that like for like sales at its Iceland stores fell by 0.2%. The company attributed this to increased competition and slowing sales since Christmas.
Although expected, the fall was disappointing after the 1.2% increase it had shown in Q3. The store chain had been showing signs of recovery after a three year sales slump where strategies of phasing out buy-one-get-one-free offers and switching to more costly organic produce proved unsuccessful with its budget conscious shoppers.
Despite the fall, profits are in line with expectations due to improved margins and good cost control. Bill Grimsey, chief executive of the Big Food Group, claimed the right development strategies were now in place for the company to be successful in the fast-consolidating UK food retailing market.
A positive sales impact has come from Iceland’s refit program, which saw the group overhaul 23 of its stores in the quarter and underpins the transition towards convenience retailing. At the end of the financial year 142 stores were trading in the new format with the refit program accelerating after Easter from three refits per week to six.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThe Big Food Group has shown further commitment to convenience store retailing by expressing its interest in buying Londis, operator of 2000 convenience stores in the UK. BFG said its “strategic expansion into convenience store retailing would be greatly enhanced by the opportunity which Londis represents” and believes the partnership would “strengthen the Londis brand identity”. BFG is now waiting for further developments from the Londis Board.
The move to convenience store retailing should indeed be a positive one for Iceland as the value of convenience store food and drink sales continues to increase in the UK and across Europe.
(c) 2004 Datamonitor. All rights reserved. Republication or redistribution, including by framing or similar means, is expressly prohibited without prior written consent. Datamonitor shall not be liable for errors or delays in the content, or for any actions taken in reliance thereon.
