>>retiring spar chairman morton middleditch wants to see a broad-based strongly competitive grocery sector
As I come to the end of a career in the trade lasting only weeks short of 35 years, a number of people have asked me what I think are the major changes that have occurred and what are my thoughts about the future.
So when I was asked to contribute this essay, my initial thought was, how many pages have I got?
Then, when I sat down to write, it became clear that there were only a handful of pivotal moments that have changed the face of the grocery trade.
In 1970 Sainsbury was the elite, Tesco was way off the pace and Fine Fare was a major force. Fine Fare was a great innovator in own label and generic brands and the trade is littered with senior people who passed through the doors of its Welwyn Garden City headquarters.
Jimmy Gulliver and Alistair Grant were the key drivers and while I never met Gulliver, we all knew him by reputation. I did get to meet Alistair on a number of occasions and he was both a great operator and a charming man. I admired him for these qualities above anyone else in the trade. Fine Fare got swallowed up in change after change, but left a legacy.
Meanwhile Sainsbury was doing what it had always done and that was remaining at the top of the pile. Then in 1977 Ian MacLaurin convinced Jack Cohen to abandon Tesco’s Green Shield Stamp policy.
By all accounts, that was some battle, and within a short period the trade’s marketing and pricing had changed as Tesco set about a relentless campaign to grow market share, investing those Green Shield savings into its business model.
That for me, although I didn’t realise it at the time, was the most significant change. And through brilliant management by MacLaurin and Terry Leahy, Tesco is on a pedestal at the top of the sector, way ahead of the rest and admired internationally.
There have been other changes, such as the much-feared takeover by Wal-Mart of Asda, with the dire predictions that accompanied it, but in structural terms that 1970s Tesco move was the biggest.
The market has consistently consolidated both at supermarket level and within my own independent sector.
It is almost too late to stop this happening through challenges to the Office of Fair Trading, but that should not stop us trying. In the same way, on behalf of the
independents, we have to continue to resist for as long as possible the pressure for total deregulation in England and Wales of Sunday Trading.
That six-hour restriction on the larger stores is still an important lifeline.
So what of the future? More consolidation? Sainsbury in terminal decline? I hope not and institutional shareholders should give Justin King and his team time to pull this former market leader back into good health.
We need a broad-based, strongly competitive sector. Just imagine if people had not had faith in Asda all those years ago and Archie Norman and Allan Leighton had not been given the opportunity to turn it round.
And then there is Somerfield, which is being reincarnated for the umpteenth time. So my plea is for a robust grocery sector with a number of key players all up against each other.
Then perhaps they would take their eye and focus off the convenience store sector. Some hope!
The convenience store sector is strong for independents in groups such as Spar, but for others the future is uncertain.
For the unaffiliated independent, I would predict that, unless a store has a unique trading location and position, its competitiveness and future have to be in serious risk.
So 35 years on am I glad to be retiring? Yes - there are new challenges in life and at 60 I am fit and young enough to tackle them with the same level of enthusiasm.
As I come to the end of a career in the trade lasting only weeks short of 35 years, a number of people have asked me what I think are the major changes that have occurred and what are my thoughts about the future.
So when I was asked to contribute this essay, my initial thought was, how many pages have I got?
Then, when I sat down to write, it became clear that there were only a handful of pivotal moments that have changed the face of the grocery trade.
In 1970 Sainsbury was the elite, Tesco was way off the pace and Fine Fare was a major force. Fine Fare was a great innovator in own label and generic brands and the trade is littered with senior people who passed through the doors of its Welwyn Garden City headquarters.
Jimmy Gulliver and Alistair Grant were the key drivers and while I never met Gulliver, we all knew him by reputation. I did get to meet Alistair on a number of occasions and he was both a great operator and a charming man. I admired him for these qualities above anyone else in the trade. Fine Fare got swallowed up in change after change, but left a legacy.
Meanwhile Sainsbury was doing what it had always done and that was remaining at the top of the pile. Then in 1977 Ian MacLaurin convinced Jack Cohen to abandon Tesco’s Green Shield Stamp policy.
By all accounts, that was some battle, and within a short period the trade’s marketing and pricing had changed as Tesco set about a relentless campaign to grow market share, investing those Green Shield savings into its business model.
That for me, although I didn’t realise it at the time, was the most significant change. And through brilliant management by MacLaurin and Terry Leahy, Tesco is on a pedestal at the top of the sector, way ahead of the rest and admired internationally.
There have been other changes, such as the much-feared takeover by Wal-Mart of Asda, with the dire predictions that accompanied it, but in structural terms that 1970s Tesco move was the biggest.
The market has consistently consolidated both at supermarket level and within my own independent sector.
It is almost too late to stop this happening through challenges to the Office of Fair Trading, but that should not stop us trying. In the same way, on behalf of the
independents, we have to continue to resist for as long as possible the pressure for total deregulation in England and Wales of Sunday Trading.
That six-hour restriction on the larger stores is still an important lifeline.
So what of the future? More consolidation? Sainsbury in terminal decline? I hope not and institutional shareholders should give Justin King and his team time to pull this former market leader back into good health.
We need a broad-based, strongly competitive sector. Just imagine if people had not had faith in Asda all those years ago and Archie Norman and Allan Leighton had not been given the opportunity to turn it round.
And then there is Somerfield, which is being reincarnated for the umpteenth time. So my plea is for a robust grocery sector with a number of key players all up against each other.
Then perhaps they would take their eye and focus off the convenience store sector. Some hope!
The convenience store sector is strong for independents in groups such as Spar, but for others the future is uncertain.
For the unaffiliated independent, I would predict that, unless a store has a unique trading location and position, its competitiveness and future have to be in serious risk.
So 35 years on am I glad to be retiring? Yes - there are new challenges in life and at 60 I am fit and young enough to tackle them with the same level of enthusiasm.
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