Bryan Roberts: Sainsbury's new strategic plan is a tipping point for UK grocery

A very overused cliché, but today might come to be seen as a tipping point in the evolution of the UK grocery sector.

Sure, there have been fairly obvious pointers from elsewhere to some of the issues besetting UK grocery retailing, but Sainsbury’s Mike Coupe has done a fine job today: not only in terms of succinctly setting out the challenges being faced by the mainstream grocers, but also in terms of being courageously honest about what it means for the industry and his own business.

Some of the macro factors – what Coupe describes as a “once-in-a-generation combination of cyclical and structural change in the industry” – are applicable to all of the big four, regardless of their current positioning or strategy. While we might question his assertion that UK shoppers are shopping more frequently, there can be no denying that they are flocking to discounters and online and that some shoppers are making increasing use of the proliferation of convenience stores (the latter point being a bit ‘chicken & egg’).

Coupe’s statement that supermarkets will see negative like-for-likes for the next few years will have raised a few eyebrows and dropped a few jaws, but one can only admire the candour and realism that frame that particular statement. While the resultant impairment might have hammered the bottom line, the realisation that some proposed stores should not go ahead and that some existing stores are perhaps worth less than initially thought is an equally bold example of nettle-grasping.

While precise details of Sainsbury’s reimagining of the supermarket are not yet concrete, Coupe’s acknowledgement that the concepts of shopper mission and retail format have been well and truly decoupled is no bad place to start. Tesco has done some great work on integrating convenience trips into its larger stores and has also impressively overhauled its c-store estate (in London, at least) to cater incredibly well for food-for-now and food-for-later missions - perhaps providing a couple of increasingly rare opportunities to extract best practice from its larger rival.  

Sainsbury’s is indeed fighting from a position of strength – areas such as provenance, instore execution, values, quality, convenience and private brand are territories in which it excels. Improved simplicity in pricing and promotions are more than welcome (although the communication thereof might be sharpened) and the retailer’s credentials in general merchandise continue to flourish.

Coupe noted today that he is more than aware that Tesco is ‘limbering up’ for a sustained recovery push in 2015. Whatever Tesco might have up its sleeve, it is clear that Sainsbury’s is working hard to reposition itself for the future, regardless of what competitive tremors might emanate from Cheshunt. 

• Bryan Roberts is director of retail insights at Kantar Retail