At IGD's Sainsbury's Trade Briefing, held on Thursday 7th June, Justin King, Sainsbury's chief executive, outlined his plans for the next three years as the retailer moves from the recovery phase to one of growth.
The plan which focuses on channel development, through the opening of 100 additional convenience stores and the roll-out of online shopping to 200 stores, and the development of the offer, seeks to grow sales by an additional £3.5bn by March 2010. Critical to this will be the expansion of the retailer's selling space, with around 10 per cent added over the period, half of which will be devoted to non-food. Sainsbury's chief executive also stressed how social responsibility is critical to how the retailer operates.
Ed Garner, communications director at TNS, discussed the latest market trends for Sainsbury's and its competitors, noting how the retailer was occupying a very successful 'mass-market/up-market' positioning.
Over the previous 52 weeks, he noted particularly strong growth for the retailer in a number of categories, while switching data indicated that over the same period, Sainsbury's had gained over £250m in sales from its competitors, with over £48m being gained from Kwik Save alone.
Shrinkage and waste reduction were the key themes of Sainsbury's retail director Ken McMeikan's presentation. In terms of shrinkage, it was outlined how suppliers can help to counter the continued growth in the number of incidences of shoplifting, improve the accuracy of direct deliveries and simplify the receipt of deliveries by stores.
In the fight against waste, McMeikan showed how investment in reducing case sizes could help deliver long-term sales growth, while well-designed packaging could aid code rotation and replenishment processes in-store.
David Gordon, IGD's director of UK research, analysed Sainsbury's three-year targets in the context of the wider food and grocery market, describing the challenges and opportunities that the retailer would encounter for each of its targets, and suggesting what the retailer may have to do to be successful in meeting those targets.
The final part of the day took on a trading perspective with contributions from amongst others Mike Coupe, trading director, and Karen Schenstrom, fresh foods business unit director.
In order to achieve the three-year targets, the retailer will seek to 'add the magic' in key categories such as fresh foods and alcohol. Investment will also continue in developing new products, with the latest range of 'Supernaturals' products highlighted as a great example of how Sainsbury's is responding to shopper demand for safe, healthy, fresh and tasty products.
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