Lab's life

A crazy day today for retail news, and while HMV and Home Retail have come out with disappointing numbers, the big story is Morrisons as Dalton Philips presented to the City for the first time. I went down to the press conference this morning and he is a very assured performer, with a lot of touches reminiscent of his mentor Allan Leighton. He is clearly a class act.

As we’d all been expecting Morrisons is going to test of online and convenience, both in a small way in the first instance. There will be three trial c-stores, while the online trial will be conducted in one region and possibly using more than one method of fulfilment.

But that’s not all the experimentation which he’s got planned. One of his favourite words seems to be ‘lab’, and Philips is launching what he called a productivity lab, a space lab, a revitalise lab and a fresh lab. These are four trial stores where Morrisons plans to test new ways of doing things, whether it be how fresh produce is sold in the fresh lab, new store looks in the revitalise lab, saving money in the productivity lab and more efficient use of space in the space lab.

This last one is particularly interesting because Philips estimates that by rationalising ranges Morrisons could save between 5 and 15% of store space, which could potentially be used to introduce non-food. With its kitchenware and Peacocks clothing trials, Morrisons has been dipping a toe into non-food, and I’m sure that’s an avenue Philips will be exploring further as well as online and convenience.

It was a big raft of trial initiatives, but Philips has the luxury that Morrisons is performing well and growing market share so he can take his time before making any concrete decisions. He’s clearly a very dynamic character - the analysts who’d been in before us also seemed impressed - and seems to have formed a decent relationship with FD Richard Pennycook despite beating him to the top job. My hunch is that under him Morrisons is going to continue to go from strength to strength.