We are perhaps fortunate to be able to read regularly of FSA chief executive John Fingleton and Booths Supermarkets chairman Edwin Booth's latest thoughts in The Grocer. The other week Fingleton's message was that small retailers would be wasting their time and money becoming involved in the Competition Commission inquiry ('You just mind the shop', The Grocer). Now Edwin Booth is advising Nisa members that it is time to think more like retailers and that shortly the Nisa Board will explain why there are compelling commercial reasons for members to support a merger with Costcutter ('The case for tapping the best of both worlds', Letters, The Grocer, ).
Come what may in terms of any final proposal by the Nisa-Today's holdings board, it is perhaps constructive to consider the differences between the options advocated by these industry pundits. There is clearly strong consensus that the sector will benefit from aggregating volumes for buying and logistics scale, especially in fresh and chilled. But there is huge scope for debate as to whether it is necessary to go about this by acquisition, rather than the more flexible approach of collaboration agreements. The latter route might also avoid the considerable financial risk perceived by some to be linked to a merger with Costcutter, as it is widely felt that taking on such huge debts could ultimately harm Nisa-Today's shareholders' interests.
As the 2006 CC Grocery Market Inquiry embraces convenience retailing, we appear to have a once in a lifetime opportunity for independent retailers and wholesalers to review and debate the options for the future structure and direction of the sector. Those interested in securing the long-term best interests of independents must seize the initiative.
Come what may in terms of any final proposal by the Nisa-Today's holdings board, it is perhaps constructive to consider the differences between the options advocated by these industry pundits. There is clearly strong consensus that the sector will benefit from aggregating volumes for buying and logistics scale, especially in fresh and chilled. But there is huge scope for debate as to whether it is necessary to go about this by acquisition, rather than the more flexible approach of collaboration agreements. The latter route might also avoid the considerable financial risk perceived by some to be linked to a merger with Costcutter, as it is widely felt that taking on such huge debts could ultimately harm Nisa-Today's shareholders' interests.
As the 2006 CC Grocery Market Inquiry embraces convenience retailing, we appear to have a once in a lifetime opportunity for independent retailers and wholesalers to review and debate the options for the future structure and direction of the sector. Those interested in securing the long-term best interests of independents must seize the initiative.
No comments yet