Store warns on below cost selling move
Sainsbury’s trading director Mike Coupe said that in markets where below cost selling is permitted “scale players become larger.”
In Britain, where there is no groceries order, groups like Tesco and Sainsburys have taken an increasingly dominant market share while “niche players became a bit better at what they do and have fought back against the odds”.
But there was no doubt predatory pricing results in larger market shares for big multiple chains, he said.
As a top executive in the second largest grocery chain in Britain, Mr Coupe was in Dublin to tell Irish food processors how to gain market share in the cut-throat British retail market.
His group’s experience with the Irish retail sector has been excellent with purchases of food and drink hitting €250 million from over 30 Irish suppliers.
Within five years that could rise to close to €1 billion when the subsidiaries of Irish processors based in Britain are included in the tally, he said.
He was speaking at Bord Bia’s fifth annual consumer food and drink industry day at the Irish Management Institute in Dublin.
He urged companies to draw up joint business plans with the retailer, share information via the web, adhere to jointly agreed key performance indicators, target profit grown ahead of sales and assume joint accountability for plans.
Sainsbury aims to grow its €24bn turnover by €3.7bn over the next three years through sales initiatives, pricing, promotions and supplier planning. In the past 12 months the number of people coming through its doors weekly has risen from 14 to 15 million.
Roughly 30% of its business is done in the greater London area, Mr Coupe said.
Bord Bia chief executive Aidan Cotter said one of the keys to a successful future for the Irish food and drink industry is innovation and bringing new differentiated products to market.
Innovation is a topic now on every corporate agenda.
He said Bord Bia is an official sponsor of next year’s Ryder Cup, which will provide a unique opportunity to attract some of the world’s most important decision makers in the food and drink industry.
