Better shops. Better products. Better service. Better execution. That's what shoppers want from the Co-operative Group's food stores. And that's what Guy McCracken has been focusing the business on delivering for the past 12 months or so. "Everything we are doing is designed with customers in mind," he says.
When he took up the post of chief executive of the group's food retail business last year, McCracken found an outfit suffering from a loss of confidence. Indigestion problems caused by the Alldays acquisition, management changes and a lack of what he calls 'joined-up retailing' had resulted in poor trading in a market that was getting ever tougher. The results speak for themselves: in the year to 14 January, sales in the food business were down 1.9% to £2.98bn and operating profit was flat at £71.6m. But overall figures mask the fact there were signs of an improvement in the second half, particularly in smaller c- stores.
"We have suffered eight successive quarters of life-for-like sales decline and last year were lagging behind the industry figures collated by IGD," adds McCracken, "We are now seeing positive like-for-likes and in the past five or six weeks have been matching or nudging ahead of the IGD figures. That's significant and encouraging. We haven't cracked everything. But it shows we're doing the right things."
One of things McCracken has been trying to do right is focus the business on a simple ambition: to be the UK's preferred community food retailer. And that's underpinned by his strategy to improve shops, products, services and execution.
As well as bringing some clarity to the strategic direction of the business, McCracken has also been trying to create a culture of joined-up retailing, where buying and marketing are genuinely working together with those in the frontline to deliver a common agenda.
That sounds easy, but it has clearly taken a lot of work to engage everyone in the process, loads of new ideas (lots of them designed to close the gap between head office and stores) as well as a restructuring that McCracken insists was more about ensuring resources were focused in the right areas than simply reducing costs or head count.
And he says the changes are starting to pay dividends: "We are seeing the benefit of highly committed and very able people now working across disciplines and across functions in a very encouraging way."
On the society's better shops agenda, McCracken has restarted the refit programme that was put on hold last year. And in the coming 12 months he has earmarked £23m to refurbish 200 more stores. He is also pouring a significant sum - £37m - into stores that are not due a refit but need new kit or refrigeration units. He says: "The emphasis is very much on shops; systems will follow. We want to put our money where customers and staff will see it."
The portfolio is also being tidied up with 100 or so under-performing stores slated for closure or disposal. However, McCracken reveals that the society is still keen to keep expanding: "We are keeping our eyes open. There's a few small parcels under review right now. We wanted to get the refit programme re-started; that was fundamental, as was getting capital investment levels up. But if we see the right acquisition, and feel it will add value, we will go for it."
At the same time, the society has committed to the rollout of the new Co-operative brand. Clearly, this is a wider project than just the food business, and will affect every part of the society, and, ultimately, the Co-op movement as a whole. It's still early days and details of the rollout are being kept under wraps. McCracken says the change can be managed, even though this is about more than just a new fascia above a shop door. As he points out, it's about uniting the society as a family of businesses.
One challenge remains: how best to manage the change of brand on own label products, which are sourced for the entire Co-op movement through the CRTG buying group that McCracken heads up. He says the new brand will start appearing on packs from early next year and will be phased in over the next two years.
The good news is that the rebranding should fit seamlessly into the work being done to improve the Co-op's products - an issue on which McCracken's passion for food really shines through.
"Product is our lifeblood," he says, before rattling off a long list of initiatives and developments in this area, such as plans to reallymake a mark this Christmas with a cohesive range of products featuring clear branding and a strong emphasis on premium (which will account for 25% of the range). The society is also preparing to launch a range called Simply in the autumn, which will allow consumers to prepare top quality meals quickly. And it also has bold plans to bring out a new health range some time after Christmas.
McCracken is also keen that the business lives up to its position as a community retailer by putting more emphasis on regional and local sourcing. And he says the society will continue to drive the responsible retailing agenda, whether that's fair trade or clearer labelling.
As McCracken explains: "Consumers are driving that agenda. But other retailers don't have the credibility of the Co-op movement. They are treated with cynicism. But it's a core element of our brand and we believe in it passionately."
Critical to the success of all these product launches and developments is making sure they happen in stores to achieve maximum impact. That's where the better service and execution agendas come into play. Both are far-reaching , with an emphasis on vital areas such as availability, queues at tills and having friendly and helpful staff in stores.
One new idea is the introduction of a selling plan for the business rather than having a promotional plan. This focuses on key events and product launches, as well as promotional occasions, and McCracken says it's helping glue the business together. Whether they are gearing up for the World Cup, or preparing for new launches, such as that recently of an Italian range, buyers, marketers and stores can really get behind each initiative.
That's what joined-up retail is all about, says McCracken. And that's why he's confident the business can get even better at all it does.nGuy McCracken took over as chief executive of the Co-operative Group's food retail business last May. With a career forged at Marks & Spencer, he had been working at the society as a consultant before taking on the role
His ambition is to ensure the business becomes the UK's preferred community food retailer
The four key strands to his strategy are: better stores, bettter product, better service and better execution
His real passion, though, is product - improving what's on offer and how it's packaged, launched and merchandised. He says: "I hope people already feel we have elevated our product quality"
The result? Like-for-like sales are growing - for the first time in two years
When he took up the post of chief executive of the group's food retail business last year, McCracken found an outfit suffering from a loss of confidence. Indigestion problems caused by the Alldays acquisition, management changes and a lack of what he calls 'joined-up retailing' had resulted in poor trading in a market that was getting ever tougher. The results speak for themselves: in the year to 14 January, sales in the food business were down 1.9% to £2.98bn and operating profit was flat at £71.6m. But overall figures mask the fact there were signs of an improvement in the second half, particularly in smaller c- stores.
"We have suffered eight successive quarters of life-for-like sales decline and last year were lagging behind the industry figures collated by IGD," adds McCracken, "We are now seeing positive like-for-likes and in the past five or six weeks have been matching or nudging ahead of the IGD figures. That's significant and encouraging. We haven't cracked everything. But it shows we're doing the right things."
One of things McCracken has been trying to do right is focus the business on a simple ambition: to be the UK's preferred community food retailer. And that's underpinned by his strategy to improve shops, products, services and execution.
As well as bringing some clarity to the strategic direction of the business, McCracken has also been trying to create a culture of joined-up retailing, where buying and marketing are genuinely working together with those in the frontline to deliver a common agenda.
That sounds easy, but it has clearly taken a lot of work to engage everyone in the process, loads of new ideas (lots of them designed to close the gap between head office and stores) as well as a restructuring that McCracken insists was more about ensuring resources were focused in the right areas than simply reducing costs or head count.
And he says the changes are starting to pay dividends: "We are seeing the benefit of highly committed and very able people now working across disciplines and across functions in a very encouraging way."
On the society's better shops agenda, McCracken has restarted the refit programme that was put on hold last year. And in the coming 12 months he has earmarked £23m to refurbish 200 more stores. He is also pouring a significant sum - £37m - into stores that are not due a refit but need new kit or refrigeration units. He says: "The emphasis is very much on shops; systems will follow. We want to put our money where customers and staff will see it."
The portfolio is also being tidied up with 100 or so under-performing stores slated for closure or disposal. However, McCracken reveals that the society is still keen to keep expanding: "We are keeping our eyes open. There's a few small parcels under review right now. We wanted to get the refit programme re-started; that was fundamental, as was getting capital investment levels up. But if we see the right acquisition, and feel it will add value, we will go for it."
At the same time, the society has committed to the rollout of the new Co-operative brand. Clearly, this is a wider project than just the food business, and will affect every part of the society, and, ultimately, the Co-op movement as a whole. It's still early days and details of the rollout are being kept under wraps. McCracken says the change can be managed, even though this is about more than just a new fascia above a shop door. As he points out, it's about uniting the society as a family of businesses.
One challenge remains: how best to manage the change of brand on own label products, which are sourced for the entire Co-op movement through the CRTG buying group that McCracken heads up. He says the new brand will start appearing on packs from early next year and will be phased in over the next two years.
The good news is that the rebranding should fit seamlessly into the work being done to improve the Co-op's products - an issue on which McCracken's passion for food really shines through.
"Product is our lifeblood," he says, before rattling off a long list of initiatives and developments in this area, such as plans to reallymake a mark this Christmas with a cohesive range of products featuring clear branding and a strong emphasis on premium (which will account for 25% of the range). The society is also preparing to launch a range called Simply in the autumn, which will allow consumers to prepare top quality meals quickly. And it also has bold plans to bring out a new health range some time after Christmas.
McCracken is also keen that the business lives up to its position as a community retailer by putting more emphasis on regional and local sourcing. And he says the society will continue to drive the responsible retailing agenda, whether that's fair trade or clearer labelling.
As McCracken explains: "Consumers are driving that agenda. But other retailers don't have the credibility of the Co-op movement. They are treated with cynicism. But it's a core element of our brand and we believe in it passionately."
Critical to the success of all these product launches and developments is making sure they happen in stores to achieve maximum impact. That's where the better service and execution agendas come into play. Both are far-reaching , with an emphasis on vital areas such as availability, queues at tills and having friendly and helpful staff in stores.
One new idea is the introduction of a selling plan for the business rather than having a promotional plan. This focuses on key events and product launches, as well as promotional occasions, and McCracken says it's helping glue the business together. Whether they are gearing up for the World Cup, or preparing for new launches, such as that recently of an Italian range, buyers, marketers and stores can really get behind each initiative.
That's what joined-up retail is all about, says McCracken. And that's why he's confident the business can get even better at all it does.nGuy McCracken took over as chief executive of the Co-operative Group's food retail business last May. With a career forged at Marks & Spencer, he had been working at the society as a consultant before taking on the role
His ambition is to ensure the business becomes the UK's preferred community food retailer
The four key strands to his strategy are: better stores, bettter product, better service and better execution
His real passion, though, is product - improving what's on offer and how it's packaged, launched and merchandised. He says: "I hope people already feel we have elevated our product quality"
The result? Like-for-like sales are growing - for the first time in two years
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