Co-op to Double Its C-Store Count

Britain’s fifth-largest grocer announces plans to double its current portfolio of 2,000 convenience stores.

March 07, 2014

LONDON — Britain’s The Co-operative has announced plans to double the number of its convenience stores over the next five years to better compete with its “Big Four” rivals.

Co-op is Britain’s number five grocer, with a market share of 6.2%, trailing Tesco, Asda, Sainsbury’s and Morrisons in sales.

Currently, the grocer operates 2,800 stores in the U.K., of which 2,000 are convenience stores. The c-store industry is the country’s fastest growing retail channel and is projected to grow its $60 billion in annual sales by nearly 30% over the next five years, according to industry body IGD.

"We've got aspirations to double the number of (convenience) stores," said Steve Murrells, the Co-op's retail CEO.

Murrells said existing convenience stores would be renovated, while some larger stores will be sold or closed. He declined to reveal the company’s pricing strategy.

"When we do reveal it, it will face into the truth that price has been a barrier," he said.

"Across the range (of store sizes) we're not big enough to compete against a Tesco or a Sainsbury's but in the space of convenience we believe that we can lead the pack."

Murrells said Co-op would also focus on improving its stores while delivering an Internet strategy.

"The conundrum with 'clicks' is that it is profit eroding and cannibalizes your big shop sales, but unfortunately if you are not prepared to eat your own children then someone else will," he said.

Murrells conceded that Co-op has struggled as of late but that it still resonates with the public.

"The number one priority for the group is food. For us that is about having enough funds available to open shops and therefore the group will give us its full support," he said.

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