Hannah Gibson

Attention – this post could save you £££ & unlock substantial new sales opportunities… Winning in Grocery It can be an arms race.  I’ve worked in Category on both sides of the Buyer/Supplier fence & know how some of the UK’s biggest brands use category insights to strengthen their sales pitches. Data budgets can run to 6, sometimes 7 figures, never mind headcount to analyse it, & expert Category Management really does become a ticket to play once you reach a certain scale. But it doesn’t have to be that way… What is Fractional Category Management? Designed for scaling Brands, it allows you to access everything you could from an expert Category team – without taking on new FTEs & without the overheads. What sort of things? (NOT exhaustive!) Market & Category Assessments - Size of each segment, channel, retailer? - Drivers of growth (or decline) & forecasts for the future? - Where is my Brand winning / losing & why? Go to Market Strategy - Channels & Retailers that should be targeted? - £ opportunity to grow my Brand in each? - What does my Brand need to do to win? Category Story & Sales Presentations - How is the retailer currently performing? - What Growth Drivers will accelerate their TOTAL CATEGORY growth? - How can I PROVE that my Brand will help unlock that growth? Range Review Support - Range & merchandising recommendations - Distribution opportunities & defence - Size of Prize modelling Training - Tailored Programmes : Basic to Advanced - Flexible, blended training (mix of formal training & mentoring on the job) Yes you do need data, but being choiceful about what to invest in & when can substantially reduce costs (we advise on this as well!). How do we work? - Full management of all or ANY constituent part of the above - Fractional – only pay for exactly what you need & no more Examples: 1 – Category Analysis / Strategy We start from raw data, complete all the analysis & produce a full category report… … Or you crunch the numbers & just call us in to help with the ‘So what?’ & more strategic recommendations. 2 - Pitch Development We do all the research, analysis, story development, opportunity sizing & final design…. … Or you do most of it & use our expertise for just 1 element … Or you do all of it & we play the BUYER role, helping you answer the difficult questions the Buyer is likely to ask - before the big meeting. Summary Fractional Category Management enables you to laser-target expert support exactly & only where you need it & can be a highly cost effective solution to help you level the playing field vs bigger competitors. To find out more please DM me or ask in the comments – we’d love to help you take your Brand to the next stage. ♻️ If you found this post useful, please give it a like & consider sharing it to your network too ➕ Follow me for insights & advice on all things Retail, FMCG, Category, Consumer & Shopper #categorymanagement #sales #growth

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JACKPOT! Huge news for Snappy, Lottery, Independent retailers and shoppers! Allwyn UK partners with Snappy Shopper to give independent National Lottery retailers the ability to sell scratchcards online and app in a Q-commerce first. With this completely new way to sell Scratchcards, independent stores can boost their National Lottery sales and associated commission – with customers able to conveniently add Scratchcards to their wider online shop on the Snappy Shopper platform and receive them directly to their door from their chosen local retailer. Natalie Lightfoot of Londis Solo Convenience, Baillieston, Glasgow, which was one of the trial stores, said: “Since introducing Scratchcards through Snappy Shopper, we’ve received a positive response from our customers, providing them with an additional reason to place orders. Notably, three of our Scratchcards have ranked among the top 100 products sold through Snappy Shopper in the past three weeks, indicating that our customers appreciate the freedom of choice and convenience of purchasing online. With all procedures correctly implemented, I am delighted to be replicating our in-store safe play experience directly to our customers doors. Who knows, we might have a big winner soon!” Allwyn’s Director of Retail, Alex Green, said: “We’re delighted that independent National Lottery retailers now have the ability to sell Scratchcards online through the Snappy Shopper platform. We know that this is something our independent retail partners have been asking for – as it offers their customers even greater convenience and provides another way for them to increase their National Lottery sales. “We’ve been working hard behind the scenes to get this service right for both retailers and National Lottery players, to ensure our robust in-store player protection standards are maintained throughout the online ordering and home delivery process. We’re really pleased with the results of the trial, which have shown us that Snappy Shopper is exactly the right kind of partner to help our independent retail partners sell National Lottery Scratchcards safely online.” Absolutely delighted we can bring this to our indie retailer community to boost sales whilst offering our customers the safest online experience. I can't wait to hopefully create a Snappy millionaire! 🤞 Read all about it https://lnkd.in/ekuE-aed #Lottery #Allwyn #SnappyShopper #Partnership #Delivery #Qcommerce

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Groceryshop & Shoptalk Exclusive: Tesco is one of the global pioneers of grocery ecommerce, its UK ecommerce business alone now generating turnover of nearly £6bn a year. And Today, Tesco has announced the creation of Transcend Retail Solutions, a new business unit to sell fulfilment solutions and consulting to other retailers. The first customer is Foodstuffs North Island Limited New Zealand, now operating stores with the Transcend manual pick solution. To understand this further, the Groceryshop team spent the day in Cambridge, England, at Tesco’s Bar Hill Extra store. Huge thanks again to Keith Chapman and Tom Williams for showing us around. This store has recently been “right sized”, with 20k sq.ft. sales area of the 105k sq.ft. repurposed to house one of Tesco’s nine UK micro-fulfilment centres (MFC). Most Tesco ecommerce orders are manually store picked from open stores. It operates centralised ecommerce warehouses (“dark stores”) around London, however store pick has been identified as the most profitable route, until sales densities reach a suitable level for an MFC. The Bar Hill MFC was installed once it reached sufficient demand to utilize the automation; manual store pick continues across the rest of the store to manage continued growth in demand. Our three key learnings from our day in-store with Tesco were: * People, processes and technology integration is key. Good automation is really important, yet only really delivers when all comes together. At Tesco a single store manager owns the full store, public-facing and MFC. They obsess over the end-to-end process & integrated its into the store, from having one single goods-in door for all deliveries, to grocery knowledge. Ecommerce systems are fully integrated into the store systems and tech stack. * MFC’s aren’t the one silver bullet, and only justify the CapEx once order density is sufficient. Primary focus must be on optimizing manual store pick models and systems. Tesco’s ecommerce operation & picking algorithm has been continuously developed for 25+ years, and since adopting this technology, Foodstuffs are recording pick rate increases of 70%. Network mapping is key to understand the tipping point where MFC’s deliver the required ROI. * Working with store teams and supporting a mindset change, from thinking as retailers to thinking as efficient fulfillers is critical, and often underestimated. Engaging and supporting this process, with appropriate tools and incentives, is critical to success. Against a backdrop of mixed news from the micro-fulfilment sector of late, seeing Tesco’s clarity that, when done right, MFC’s are working, was exciting. We’re looking forward to exploring all this in more detail at Groceryshop next month in Las Vegas (7th to 9th October). Dr. Oliver Vogt, who has led the development of Transcend at Tesco, be joining us on stage, as will Lindsay Rowles, General Manager Retail at Foodstuffs NZ. See you then.

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⏱️ 60 second read - Highlights of JS Performance ⏱️ Simon Roberts has plenty to smile about this week as Sainsbury's posted a H1 investor update... In summary: Sainsbury's reported a +3.7% increase in #retail underlying profit to £503 million on the back of a 5% rise in #grocery sales. The company claimed some significant gains in share versus the rest of #ukgrocery, driven by customers opting for larger baskets and choosing to trade up to the premium Taste the Difference range, (delivering +18% sales increase YoY). Chief Executive, Simon Roberts highlighted the strong performance and continued volume growth in their food business, attributing success to the combination of value, quality, and service, bolstered by a £1 billion investment in recent years. Looking forward, Sainsbury's plans to open about 20 new #supermarkets and 20 to 25 #convenience stores in the next 18 months. They recently acquired eleven Homebase and two Co-op stores to expand their presence. Looking forward, Roberts expressed confidence in maintaining strong profit growth, expecting retail underlying #profit to reach £1.01 billion to £1.06 billion, a growth of 5% to 10%. The company is also preparing for another robust performance during the #festive season. #striqenews #bfg

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Is loyalty pricing affecting consumer behaviour, and is this having an impact on how supermarkets compete with each other? This is one of the areas the CMA is currently investigating. I believe that next up they will be investigating if the Earth is round (controversial I know). They also want to know if any group of shoppers are disadvantaged by this type of promotional activity. Hmmm, let me investigate that (quick search of the internet), 'All members of the scheme must have a valid UK address and be aged 18 years or over', that'll be a 'no' then! The Retailers call them Loyalty cards in the vain hope that Customers might be loyal, the reality though is somewhat different. We have all the 'loyalty' apps on our phone & just pull it out every time we go in one of the stores. That includes pretty much every single Retailer on the high street, it also includes the place where I buy my bagels & the local coffee shop round the corner (they have two sites)! When Tesco launched Club Card Exclusives back in 2020 then the deals were better than standard deals. To be involved in a Club Card promotion you had to offer a deal better than anything else available. Where are we today? The same promotions are offered across every loyalty scheme. Of course there are some deals that are better than others, promotions that are exclusive to one Retailer. This is no different to when I was a Buyer 10 years ago!! Retailers have always looked for something different to make them stand out. But, as we know, there is no such thing a new idea in retail. When was the last time you walked into a Retailer & thought 'wow, I've never seen that before'? Everything in the UK has been done before, there is nothing new. We are no longer the market that Retailers come to learn. I was speaking with a market specialist the other week at the The Health & Beauty Association Conference & she was taking clients to Ireland, Italy, Scandinavia not UK stores. When shoppers get to the till most of them have the app so they get the discount. I believe that over Christmas Tesco said that 95% of transactions used Club Card! Including loyalty schemes in the G33 is a natural step as it is what the Customer sees. If a Customer does not want to give away their data then they do have an option, Aldi. They could do with a few more Customers at the moment! #theretailmind #groceryretail

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Time for political change? Time for retail to back ourselves? Read my thoughts on the next phase of our election strategy in today's article for Retail Week where I call on retailers to come together and share more of the positive stories about how the reach and scale of retail can drive positive change. With the right policies and right relationship with a future government we can achieve so much more!! #BuyIntoRetail🛍️ #BritishRetailConsortium #Retail #UKElection #EverywhereEconomy 

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I’m delighted to announce today that Foodstuffs North Island is the world’s first retailer to partner with UK retail giant @Tesco subsidiary Transcend Retail Solutions, to deliver store pick capability for e-Commerce. We anticipate over 80% of total fulfilment will continue to be completed in-store, ensuring this process meets the expectations of customers and is cost effective is key to the long-term success for e-Commerce. We have now launched 2 stores (both New World and PAK’nSAVE) with Tesco’s picking system, and have seen overall pick rates improve by over 70%, providing a strong competitive advantage in the region. This collaboration brings Tesco's proven e-commerce expertise to our operations. With over 40 years of online grocery experience and processing more than 1 million weekly online orders, Tesco's solutions are robust and scalable. I want to take this opportunity to thanks Transcend Retail Solution’s CEO Dr. Oliver Vogt for working with us as their first customer, and to the FoodStuffs North Island board and CEO Chris Quin for backing this game changing initiative, and the central / store teams involved in landing the first stores. We're proud to lead the way in adopting cutting-edge retail technology, ensuring our co-operative remains competitive and continues to meet the evolving needs of New Zealand shoppers. #DigitalTransformation #OnlineGrocery #RetailTech https://lnkd.in/gPXxnZSh

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7 UK supermarkets transforming their store estates this year A focus for many UK supermarkets this year is to refresh, modernise and expand their store estates to improve the shopping experience for customers across the country. With so many grocers planning to update their sites and in a range of different ways, we round up what changes to expect from seven of the UK’s leading supermarkets in the year ahead. #supermarket #transformation #store #customerexperience #expansion #customer #grocery

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'The results to date suggest we are unlikely to identify widespread evidence of loyalty promotions that mislead shoppers in this way'. It took the CMA six months to work this out! Apparently 'In our analysis we have seen examples of retailers alternating between ‘was/now’ promotions available to all shoppers and loyalty price promotions.' Why did this take six months to 'uncover'? After six months investigating the Retailers the CMA has literally come up with nothing. So what are they going to do now? They have have commissioned a consumer survey to understand the impact of loyalty pricing on how we shop, including how much people shop around and compare prices! A survey, which will look at whether loyalty pricing is affecting shoppers’ engagement with supermarket loyalty schemes (it is). Whether shoppers’ trust that the price savings for members are genuine (they are, as the CMA have found). If Shoppers have concerns about supermarkets’ use of their personal data (they don't have to use a loyalty card, they just won't get the deals) & finally whether attitudes to loyalty pricing vary between different types of shoppers (they will). I have one question to ask the CMA though, what can you do with the answers to these questions? The CMA might want to read the CTSI Guidance for Traders on Pricing Practices, issued in December 2016. When it came out the CTSI said 'Only a court can decide if a business has broken the law and the guidance is not intended as a set of rules'. So what exactly are the CMA investigating? The Retailers aren't legally bound by any rules, it's only guidance, which they all interpret differently! The CMA also continues to look at Retailer profitability & yet again 'does not find evidence that groceries inflation is being driven at an aggregate level by weak competition between retailers'. They say 'effective competition is ensuring continued pressure on retailers to pass on cost savings to their customers'. Blimey, such insight! They said they 'recognise that the prices of groceries for consumers have increased, and are likely to continue to remain elevated'. That is because we still have inflation, just at a lower level! Rocket science this is not! Their (extensive) report shows that weighted average operating margin for the retailers’ grocery businesses is below 3%, not a level you could say is profiteering! The CMA continue to plough on, uncovering nothing with no evidence of anything untoward. The market is working, those who put the Customer first will win, those who put profit ahead of the Customer won't. Not hard to understand really is it? #theretailmind #groceryretail #GSCOPexpert

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The latest retail figures from the ONS, showing sales volumes to have risen by 2.5% since the start of the year, should provide retailers with confidence ahead of their busiest quarter. In contrast, last week’s index from GfK revealed that consumer confidence has fallen to the lowest level since the start of the year, and therefore tells a different story. The latter paints a mixed and more worrying picture of consumer attitudes towards spending, with low levels of confidence no doubt influenced by the negative rhetoric surrounding the state of our economy in recent months. So what are the key takeaways for retailers as they prepare for their busiest months of the year. Should they be concerned or feel cause for optimism?   ➡️ Households are downbeat about their personal finances and the wider economy. Households are less optimistic about their financial outlooks, with optimism and confidence in the wider economy declining right back to January’s level. This is the largest one-month dip since April 2022 and could have a big impact on the shape of the golden quarter.   ➡️ Major purchases on hold… for now. Consumers feeling pessimistic about their financial situation and the broader economic outlook will have a knock-on-effect to their willingness to spend money for the rest of the year. This is reflected in the extremely low score for the release’s ‘Major Purchase Index’ and consumer attitudes willingness to spend on big ticket items.    ➡️ But it’s not all bad news. Fears about the October Budget and what this means for consumers in real terms have had a big impact on consumer sentiment and confidence. In the longer term though, and post-Budget, rising real wages and steady inflation should serve as positive signs for retail businesses.   Against this backdrop, retailers must focus on the fundamentals that keep customers coming through the door. This naturally includes maintaining high levels of customer service and offering high-quality products. But more than ever, this data underlines the importance of a relentless focus on cost. With shoppers less likely to part with their money, reassuring them that your business is offering value-for-money needs to be the number one priority. A focus on this will ensure that customers remain loyal ahead of the biggest spending quarter. https://lnkd.in/e7Hddejz

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CMA Finds Little Evidence That Loyalty Pricing In Supermarkets Is Misleading Shoppers The Competition and Markets Authority (CMA) today revealed its initial findings from its ongoing review of loyalty pricing. This probe began in January, regulator has checked whether any aspect of the Tesco, Sainsbury’s, or Morrisons schemes mislead shoppers and if they offer genuine savings. The CMA noted if any pricing practices indicated that the non-loyalty (or non-member) price may have been artificially inflated to make the loyalty price appear “misleadingly attractive”. It has checked information from grocery retailers that offer loyalty pricing, analysing what happens to prices before, during, and after a product goes onto a loyalty price promotion. Its ongoing probe has already involved tens of thousands of loyalty price promotions. In a brief statement today, they said results to date suggest it is “unlikely to identify widespread evidence of loyalty promotions that mislead shoppers in this way”. However, examples were found of retailers alternating between ‘was/now’ promotions available to all shoppers and loyalty price promotions. The CMA said: “This raises questions as to what the ‘regular’ price is for the product and therefore whether the claim saving for the ‘was /now’ promotion is genuine. We are looking further into this issue.” They are also comparing a sample of supermarkets’ loyalty prices to those prices charged by other supermarkets at the same time. “Particularly given concerns raised by stakeholders, it is valuable for shoppers to have insight into how loyalty prices can compare with prices available elsewhere, including when they are on promotion at other retailers,” it said. Meanwhile, the CMA has commissioned a consumer survey to understand the impact of loyalty pricing on how people shop, including how much they shop around and compare prices. The survey will also explore issues such as whether loyalty pricing is affecting shoppers’ engagement with supermarket loyalty schemes, shoppers’ trust that the price savings for members are genuine, and whether shoppers have concerns about supermarkets’ use of their personal data. The CMA is due to publish a full report of its findings in November. [See full article, in Kamcity, link in comments] [By way of comparison with last year see the CMA’s   ‘Competition and profitability in the groceries sector’ report 2023, link in comments] NamNews Implications: *       Loyalty-shoppers are savvy, and understand and study deals. *       Loyalty-shoppers are in an (implied) agreement with the retailer… *       …to sell their buying behaviour data in return for the loyalty discount. *       It follows that as Retail Media Networks evolve… *       …this first-party data will become more valuable… *       …and perhaps the CMA should check the extent to which this incremental value of the data is shared with the loyalty-shopper? #Competition #CMA

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Should you pay a potential customer for the opportunity to sell to them? Actually this is not exactly what is on offer here ..it is actually the opportunity to meet the buyer, not sell to them In someways yes.... I think £490 (for yes that is how much the ticket costs) doesn't seem like a massive investment to get the full insight into a target customer's strategy and maybe meet the buyer to build the network But on the other hand, it doesn't feel ethical - charging potential suppliers for the opportunity to meet your buyers especially the smaller ones who add value to Ocado ranges with exclusivity. Doesn't seem right. Especially as it could be better invested in brand marketing. Remember £490 is a big chunk of cash! So do YOU pay to play in your industry?

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Conflicting information on the consumer: Retailers continue to warn of a pullback while the government continues to show consumer strength in the data. Who is/will be right? It will be interesting to see as I’m not sure anyone really knows yet. #consumer #economy #economictrends #retail #retailspending #retailrealestate

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Can charity shops be good for indie retail?   British designer, founder of fashion brand ‘Red or Dead’, Wayne Hemingway MBE was perhaps an odd choice of speaker at the British Independent Retailers Association Conference. conference last week, introducing as he was his latest venture, Charity Super.Mkt. Charity shops have long been criticised by many indie retailers as the death of the High Street. However, a series of examples and statistics presented by Wayne may have persuaded a cynical audience that Charity Super.Mkt offers a shopping experience that is an "awakening experience" for Gen Z and Gen A consumers. Indeed, such is the success of this new initiative, it has attracted the interest of big brand retailers including Apple. Charity Super.Mkt was founded in response to a rise in second-hand greenwash and to disprove the outdated notion that charity shops ruin high streets. Listening to charities and their desire to broaden their demographic and horizons Hemingway and his partner, Maria Chenoweth, created an umbrella brand to get charity retailers into mainstream spaces and places that they wouldn't normally be able to access, creating a brand that would fit nicely into any prominent location. After two years of market style pop-ups, Charity Super.Mkt moved things up a gear in January 2023 with its first bricks-and-mortar residency at Brent Cross Shopping Centre and the response was overwhelming. Costs for the fit-out of the vacant unit were approximately £40,000 – an amount Wayne and Maria hoped to be able to get back over the planned 4-week residency. Sales on the first night were in excess of £20,000! The store was so popular, the stay was extended by a further two weeks. 80% of the revenues went to the charities. Charity Super.Mkt’s launch article was the 3rd most read article on the BBC and the news spread like wildfire, further Charity Super.Mkt pop-ups have appeared in shopping centres across the UK and the total revenue shared by 50 charities now exceeds £2.75M. At the BIRA conference, Wayne revealed that Apple approached him to locate Charity SuperMkts close to their stores, as it was clear that the initiative was attracting the younger generation and the halo effect was boosting their own footfall and sales. Gen Z and Gen A are seeking variety, vintage, low cost, environmental and sustainable high streets, as well as things to do as well as buy. When questioned, however, Wayne admitted that the mega charity stores were a city / large-scale shopping centre phenomenon and wouldn’t work in smaller towns, but it does raise the question whether independent retailers’ wide spread prejudice against charity shops is a sensible view, especially if they appear to bring the younger generation on to the High Street. To inquire about locating a Charity Super.Mkt in your area visit

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Wow, what a move from Waitrose & Partners . It's great news for Dishpatch and continued, bold progress from Waitrose & Partners targeting more meal occasions through their omnichannel approach. Why is this exciting for Waitrose? 🥩 You can use the model across any cuisine. 👨‍🍳 You can use the model with any chef. 📈 It instantly accesses many chefs rather than being tied into one exclusive partner chef. 🍲 There is a close customer fit, and it will appeal to lost shoppers who have migrated to M&S. Why is it potentially challenging to grow? 💷 They are VERY expensive boxes - from £50 to £90+, for normally 2 people. 🍽 It's an alternative to dining out as it stands, and the boxes need to be priced accordingly to make it commercially viable. 🛒 Operationally it's complex. What Waitrose & Partners should do with it: 😋 Make boxes more accessible with mid week meals and lower price points. I expect Ottolenghi may have a series of boxes soon. 💻 Use stores - Click and Collect to remove high courier costs, utilise the in house supply chain, and even consider picking recipes from store with set recipes and ingredients on shelf. 🎄 Anchor on seasonal peaks like Christmas - how about the 'Waitrose Christmas Dinner Box' by ? The opportunity is endless. But it needs to be kept easy to shop and ideally include personalised ranges using loyalty card insight. K eep I t S imple S tupid and you will succeed Waitrose & Partners 👊 Martyn Lee FCMI CMgr. Louise Dolan Nathan Ansell Oliver Chadwyck-Healey

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What’s been happening in retail this week? · Asda's total revenues, excl. fuel, increased 6.6% to £5.3bn; with like-for-like sales up 1.4%. George – the UK market leader in kidswear and third-largest fashion retailer by sales volumes – grew clothing revenues by 3% to £293m in Q1, and 3% on a like-for-like basis. · Sainsbury's is starting a five-year strategic partnership with Microsoft, helping the retailer to integrate AI capabilities to drive the grocer’s strategy. Built on “smart cloud foundations”, the partnership will drive better productivity, CX and leverage their data to enhance their capabilities. · Waitrose & Partners will open its first takeaway GAIL's Bakery’s on 6 June at London’s Canary Wharf. This follows the addition of Gail’s sections in 64 Waitrose stores. The new 280 sq ft bakery features click-and-collect and delivery services. · WHSmith introduced its first own-brand food range, "Smith’s Family Kitchen," in over 300 UK travel stores. The range includes over 30 products, targeting time-pressed customers. · IKEA delayed the opening of its Oxford Street store for a second time to spring 2025 due to water ingress issues in the Grade II listed building. · Lidl GB is increasing hourly pay for UK employees for the third time in 12 months, investing over £2.5m, effective 1 June. This follows a total investment of nearly £50m in pay raises over the past year. · Temu faces EU legal challenges by 17 companies, accused of "manipulative practices" and lack of transparency. Allegations include making it harder to delete accounts, misleading pricing, untraceable traders, and unclear product recommendations, violating EU laws. Temu committed to addressing these concerns and has made agreements with German and South Korean consumer organisations to improve compliance. · Currys plc expects to surpass its profit guidance in the year to 27 April 2024, with anticipated adjusted pre-tax profits of £115m-£120m, up from "at least" £105m. Group like-for-like sales grew by 2% in the final 16 weeks, with like-for-likes also rising by 2% in the UK and Ireland. · Burberry reported a 4% drop in revenues to £2.9bn and a 40% decline in pre-tax profits to £383m for the year ending 30 March 2024. Adjusted operating profit fell 25% to £418m. The retailer warned of a 25% decrease in wholesale revenue, a potential £30m revenue hit due to currency headwinds, and a £20m hit to operating profit in 2024/25. Burberry identified cost savings to offset inflation. This is just a selection of news this week. Sign up below for more insight ⬇️ https://lnkd.in/d-z25aM · Don't forget to sign up for our webinar "Outlook for 2024 & Beyond: Retail Prospects & Shifts in Consumer Affluence" in partnership with beBettor 4 June at 12pm ➡ https://lnkd.in/eBfhA9Xb

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Profits Bounce Back At Boots After Year Of Strong Sales Growth. Where next? Latest accounts filed at Companies House confirm that the performance of Boots UK continued to improve last year, supported by the overhaul of its store estate and product offering. Pre-tax profit up from £4m to £60m, 12 months to 31 August 2023, revenue up 8.3% to £7.05bn. Operating profit up 60% to £88m i.e higher gross margin, driven by strong retail sales, offset increased operating costs. Boots’ core retail division: Revenue up 12.2% to £4.72bn, L-F-L growth of 12.5%, improved footfall, increased online capacity, and strong performance of its revamped beauty ranges. Heavily investment in own-label offering + expanded branded ranges in new beauty halls. Improved price competitiveness (Advantage Card scheme), membership up 1m to 13m 2023. Pharmacy ops revenue up 1.3% to £2.34bn, with L-F-L growth 4.0% via “favourable” NHS drug reimbursement rates reducing impact of lower prescription volumes and reduced demand for Covid and flu vaccinations. Boots closed 55 stores during 2022/23 as part of its reorganisation programme, ending the year with 2,177 sites. They announced plans to consolidate by a further 300 stores “to concentrate team members where they are needed and focus investment more acutely across the store portfolio, with the ambition of consistently delivering an excellent and reliable service”. Boots has been owned by Walgreens Boots Alliance since 2014, and has been the subject of sale speculation over the last couple of years, with new Chief Executive Tim Wentworth saying in January that the US firm was “evaluating all strategic options to drive sustainable long-term shareholder value”. Earlier this month, it was reported that WBA was renewing its efforts to offload Boots, reaching out to potential buyers and hiring advisors to hold early-stage discussions with interested parties. Figures released last month show retail sales at Boots rose 5.9% during the three months to 29 February 2024, helped by increased footfall in its store and increased demand online. NamNews Implications: * Excellent results. * But best keep in mind that WBA want to remove Boots from their equation in order to focus on US opportunities, without UK distractions. * The issue then becomes: - A: Have WBA the patience to wait for the five years of good Boots results required to warrant a successful re-flotation? - B: Or will WBA compromise on their expectation of Boots value in order to obtain an acceptable but lower sale price? * Each option requires suppliers to handle their Boots’ business differently. * i.e. Option A: Supplier employs a finance based 5-year strategy or B: Supplier prepares shorter-term strategy, anticipating a PE-based takeover. * (not forgetting that Amazon may be dusting down its option of using Boots as a basis for buying its way into comprehensive healthcare provision?) #Boots

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Ocado market share in August 2020 was 1.8%, August 2021 also 1.8%, August 2022 1.8%, August 2023 1.7% & latest number? 1.8%. Am I missing something? In the same period Aldi have grown share from 7.9% to 10%, Lidl from 5.9% to 8.1%, JS from 14.9% to 15.3%. In four years, Ocado have gone nowhere, no trees ripped up. Maybe I've not read the press release from Ocado? Ten years ago Ocado had share of 0.8%, so they have grown by 1% in 10 years. How much has it cost them? (£1.5bn is the answer btw). They recently raised £700m to refinance some of their debt & the offering was upsized due to strong demand. This is probably based on the statement that they released with their City update stating 'It is clear that the global channel shift to grocery online has now resumed and Ocado is uniquely well-positioned to take advantage of this opportunity'. Where is this global shift happening? It's not happening in the UK. It's not happening in Australia, where Coles are still waiting for either one of their CFCs to open after long delays. In Canada Sobeys, who had an exclusive agreement with Ocado, put further development on hold & ended the exclusivity clause! Ocado say they offer over 58,000 products, Aldi about 2,000. 10,000 of Ocado's products are Aldi matched. So why aren't they doing any better, why haven't they moved the dial over the past five years. It's because they have one thing missing, shops! They don't have any physical shops, made from bricks, with car park & trolleys. A shop that customers can walk round, pick up offers they weren't expecting, be enticed by the smell of a bakery. On average Ocado have been losing £250m / year for the past five years & they haven't moved the dial with regards to share. I've just had a search of Ocado's site & now they do sell magic beans, I knew they would! These are from Heinz though, magical beanz. The magic beans Ocado have been selling for years aren't as good for you! #theretailmind #Ocado #bricksnotclicks

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