What do online shopping behemoth Amazon and UK frozen ready meal purveyor Cook have in common? Both operations are included in IGD's annual Global Retail Innovation: Ten to Watch 2007.
The list pulls together retailers from around the world that show strong growth prospects, best practice and innovation. Cook's inclusion is the first time a UK company has secured a top 10 spot. But this year's list also includes a Polish discount retailer and a US forecourt convenience chain. So what does it take to break into this elite band?
Those that have made the list are hot on sustainability, innovative formats or emerging markets, according to report author and IGD senior business analyst Jonathan Gunz.
Cook, which sells frozen ready meals created from scratch by a qualified chef, fits the bill with a "unique and inspiring" proposition that "encapsulates many of the hot trends shaping the global retail market including convenience, provenance and nutrition," he says.
It has also tried to redefine the frozen food category and reconnect people to food, according to MD James Perry. "This is the nearest thing you can get to home cooking without actually home cooking," he says, adding that despite being courted by multiples, he has no intention of becoming part of the supermarket supply chain: "Food is an art not a science but to big business it's a science, and it has to be, but that means that the art gets squeezed out."
One retailer that has stayed true to the art of retailing despite its size is Amazon, which earned its place on the list with the launch in the US last July of Amazon Grocery, which gives customers access to 18,000 non-perishable grocery items in a low price online environment with free delivery. If it can leverage its strong brand and huge scale it could be a force to reckon with, says Gunz.
Others make the cut thanks to strong CSR and sustainability strategies, one of the strongest themes to emerge in this year's list. Gunz highlights Polish discount outfit Biedronka's CSR efforts and Swiss retailer Migros, which has long been a champion of common sourcing standards and food safety. It also recycles 90% of its aluminium, uses recyclable plastic containers for transportation of fresh produce and moves 50% of goods by train.
Another retailer flashing its green credentials is Australia's largest organic and wholefoods supermarket Macro Wholefoods Market with its product range of more than 12,000 organic, natural and fair trade products. It also boasts Wellbeing Centres, which offer yoga, pilates and acupuncture and is experimenting with a standalone cafe concept.
Meanwhile, American East Coast forecourt convenience operator, Wawa, makes the grade thanks to its "food first, fuel second" approach.
So though a company's stance on sustainability is key, it is trumped by its ability to innovate.
"Flexibility and willingness to take risks are key requirements for those embarking on format experimentation, as is an understanding of consumer needs," says Gunz. "Another prerequisite is management vision and passion. These retailers are successful in finding the retail X-factor."n
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