The Co-operative Group is ploughing £2m into its store in Lerwick in a bid to combat Tesco's entry on Shetland.

The society will increase the size of the store from 11,600 sq ft to 13,900 sq ft to offer an increased range of products and a more shopper-friendly layout.

Work starts next month and is scheduled to be completed by the end of September.

A spokeswoman for The Co-operative Group denied the revamp was a direct response to Tesco making its debut on the islands following its acquisition of a Somerfield store in March.

Tesco plans to reopen the store as a Tesco next month and has also submitted plans to increase its size from 20,000 sq ft to 30,000 sq ft. "The revamp of the store forms part of our store refit schedule for this year and the rollout of our new brand, and isn't in response to Tesco coming to the island," the spokeswoman said.

The Co-operative Group's new store would have an emphasis on chilled and fresh foods with a 50% increase in space for chilled produce. There would also be a new bakery and an extended selection of chilled beers and wines.

It also plans to highlight its ethical credentials and work with fairtrade, recycling, ethical water and wind turbine projects throughout the store.

"This £2m revamp and extension represents a significant investment in Lerwick by The Co-operative, which has been serving Shetland for 100 years, and reinforces our commitment to remaining at the heart of the community," said John McNeill, chief officer for The Co-operative Group in Scotland.

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