© The Financial Times Ltd 2016 FT and 'Financial Times' are trademarks of The Financial Times Ltd.
January 8, 2014 1:08 pm
Convenience stores appeared to be the big winners of the Christmas and the new year period as the Co-operative Group and Nisa, which are owned by small shopkeepers, reported stronger-than-expected sales.
The Co-op said that like-for-like sales excluding fuel grew 1 per cent for the 13 weeks to January 4, compared with the same period last year, beating J Sainsbury on that measure.
Co-op convenience stores delivered like-for-like sales growth of 3.2 per cent as the group brushed off negative headlines about a bailout of its banking arm.
Nisa, the Scunthorpe-based distributor with 4,000 outlets, said sales in December grew 15.3 per cent in value terms and 16.4 per cent in volume year on year. It sold £134m of stock to members, some of whom reported double-digit sales rises in the Christmas week, echoing the pattern at other food retailers.
The Co-op had a sales spurt over Christmas, preceded by a lacklustre October and November as consumers delayed spending. The Co-op increased like-for-like sales in the three weeks to January 4 by 3.5 per cent, with convenience stores reporting like-for-like growth of 5.4 per cent.
The Co-op, which has a store in every postcode in the country, said total food sales over the 13 weeks were flat at £1.7bn after selling some larger stores during the period. It has about 2,800 outlets in total.
It was helped by discounting, with members receiving vouchers worth 10 per cent of spending to use by Christmas, and a repackaging of many products.
Its online electrical business increased sales by 28.2 per cent during the 13-week period, and its chain of pharmacies reported sales rose 1 per cent over the same period.
Steve Murrells, chief executive of retail at the Co-op, said: “These results are a reflection of all our efforts to improve the customer offer and show the value of our strategic focus on convenience retailing. We are now delivering better products, at better prices, in better shops. We still have much to do, but these trading figures give us real encouragement.”
More customers are abandoning a weekly shop for more frequent visits to smaller stores to eliminate waste. However, with Asda and Wm Morrison joining J Sainsbury and Tesco in opening chains of convenience stores, the Co-op has come under pressure in its heartland, forcing it to refocus.
Euan Sutherland, group chief executive, said: “The recapitalisation of the bank at the end of last year represented an important milestone and now we can see that the foundations of the wider group, through its trading businesses, remain strong.”
Please don't cut articles from FT.com and redistribute by email or post to the web.
Sign up for email briefings to stay up to date on topics you are interested in