Blog: Dean BestSainsbury's faces fresh challenges after strong year

Dean Best | 8 May 2012

Sainsbury's, the UK's third-largest grocer, will tomorrow (9 May) report its annual financial results. Of the UK's largest food retailers, Sainsbury's has been one of the better performers in recent months but, as ever in the country's fiercely competitive market, it faces a new round of challenges over the next 12 months.

Initiatives including the Brand Match price-comparison scheme have enabled Sainsbury's to drive sales over the last year, while rivals like Tesco, and more recently Morrisons, have stuttered.

In March, Sainsbury's reported a 2.1% increase in like-for-like sales for the year to 17 March. Tomorrow, Sainsbury's is expected to report an increase in annual pre-tax profits of around 5%, a slowdown from the 9% increase it filed last year, an indication perhaps of the cost of competing in the UK grocery sector and also the expansion of its store network over the last year. However, Sainsbury's has won praise from industry watchers. Shore Capital analyst Clive Black says he believes Sainsbury's "has cranked out a very good performance" over the last 12 months.

Nevertheless, as ever in the UK's fiercely competitive market, Sainsbury's faces a fresh set of challenges, including Tesco's plans to revitalise its UK business and, interestingly, from Waitrose. Last week, Waitrose announced an extension of its own price-comparison initiative against Tesco, which as well as targeting the UK's largest retailer, could also lure some shoppers away from Sainsbury's.

The thoughts of Sainsbury's chief executive Justin King on these issues and more (including the Government's expected announcement tomorrow of an adjudicator to monitor dealings between retailers and suppliers) will be worth hearing.


BLOG

What does Gen Z want from brands? IRI presents its view

Industry watchers IRI has published the findings of two studies in the US they claim can give an insight into the shopping patterns of those aged 21 and under - Gen Z....

BLOG

The identity of the buyer of Tyson's Kettle business emerges

In February, we reported Tyson Foods had sold its Kettle business, one of a series of non-protein disposals at the US meat giant. But the company would not disclose the buyer. This week, the new owner...

BLOG

Leading French grocers eye buying "alliance" - and suppliers aren't happy

Buying partnerships between France's food retailers have been a feature of the country's grocery landscape for a number of years but this week came news of a potentially significant new tie-up - and s...

BLOG

just-food off for Easter

A point of admin: just-food is closed tomorrow (Good Friday) and on Easter Monday. It promises to be a wet public holiday here in the UK but we'll likely console ourselves in chocolate....



Forgot your password?