£814m spent on reinvestment in convenience retail in 2018
Traditional newsagent store type still in demand according to Christie & Co’s retail managing director, Steve Rodell who commented, “Convenience remains robust because customers are always in need of the products that are being sold, whether it be milk or bread. So, there is still very much a place for the smaller units.”
Christie & Co’s business outlook for 2019 revealed that £814 million was spent on reinvestment in the convenience sector in 2018.
Convenience continues to be an evolving experience, where independents have the flexibility to take advantage of this – particularly if they have the space to accommodate fresh food and store parcels – a key growth area in mails.
Tesco cost cuts affect 9,000 jobs
The UK’s largest supermarket has announced that it will close food counters in 90 of its stores as part of a cost-cutting plan to save £1.5 billion.
Tesco said, “Not only are customers shopping in different ways, but we know that they have less time available to shop too – which means they are using our counters less frequently.”
Competition between supermarkets is fierce, and looks to get even more so if competition and market regulators allow Sainsbury’s to take over Asda – meaning Tesco could lose its place as the biggest supermarket.
Healthy food trend continues
Over 500 Shell forecourt retailers are to partner with Jamie Oliver for an increased and healthier food-to-go range.
A Shell spokesperson commented on the ever-increasing demand for healthier options when it comes to convenience food: “Across the UK, we’re seeing a growing trend towards healthier food, but it has to taste good and be convenient… This range has been designed to give our customers the choices they want when they’re on the move.”
Shops start cracking down on serial returners
£1 in £5 spent in the UK is now from online shopping via websites and apps, meaning it’s easier and easier for customers to order clothes and other items and send them back, often free of charge. One sign that the returns market is continuing to grow is that shops are starting to crack down on ‘serial’ returners.
Nearly half of shops (45%) are planning to blacklist these shoppers – customers who deliberately and regularly buy multiple items with the intent to return some. Retailers are also turning to social media to catch out people who wear items before trying to return them.
And finally, businesses continue to report on their Christmas trading results, including Royal Mail also reported on their Christmas performance which you can find here.
What does this mean for Post Office?
As many Post Office branches are in convenience stores, investment in this sector is positive news that suggests that this type of retail is still one that customers want and need.
Tesco listed customers’ lack of time to use counters as one of the reasons for closing them, which is also good news for the convenience sector. Customers with little time to do a big weekly shop tend to rely on convenience stores for bits and pieces during the week to make a meal or grab a snack. And lastly, it’s a sign of how big the returns market is getting that shops are starting to crack down on serial returners.
Let us know your thoughts in the comments and catch up on more retail news next week.