12th Feb 2020 09:16
(Alliance News) - J Sainsbury PLC on Wednesday said it is looking to capitalise on a "growing trend" for fast, convenience shopping by opening 10 smaller format stores in the UK.
The first "On the Go" site is to open at Mansion House in the City of London. The grocer said it will launch nine more in London, Edinburgh, Bristol and Glasgow.
Elsewhere, the company said it has 130 of its "local" format stores in urban areas which could be converted into On the Go sites.
"The On the Go stores tap into the growing trend for convenient food to go. According to IGD, the UK food to go market is forecast to be worth GBP23.4 billion by 2024, up from GBP18.5 billion in 2019, growing by 26%.
"The stores will help Sainsbury’s maintain its market-leading position in convenience. For the last five years Sainsbury’s convenience stores have outperformed the market in terms of trading intensity and around nine million customers visit Sainsbury's Locals every week."
The new format stores will also "puts a spotlight" on its general merchandise arm, which includes the Argos catalogue retailer and the Tu clothing brand.
Sainsbury's Director of Commercial Operation Graham Biggart said: "Convenience is a growing part of our business and we have greater capability than ever to truly tailor Local stores to local needs – across our products, formats, services and operations.
"Our new On the Go Mansion House Local is a great example, bringing a new kind of convenience to busy local workers with limited time and delivering the curated range and fast experience that will enable them to get exactly what they want at pace. We're confident this format will further strengthen our market-leading position in convenience."
In September, the company said an internal review resulted in plans to launch 10 new supermarkets but close between 10 to 15.
Shares in the company were 0.4% higher at 203.00 pence each in London on Wednesday morning.
Earlier on Wednesday, the company said it will begin a search for a new chair for its banking arm after incumbent Roger Davis announced plans to step down.
Davis has been chair at Sainsbury's Bank since May 2013.
The grocer said: "A search to find his replacement will begin and a further announcement regarding timings of his retirement and news of his successor will be made in due course."
The news comes less than a month after the company said Chief Executive Mike Coupe will step down from the role after nearly six years at the helm. He will be succeeded by Retail & Operations Director Simon Roberts
The company in September announced a freeze on putting new cash into its financial services arm as part of an overhaul of the unit.
The firm at the time said it would "immediately stop new mortgage sales" and have no more "capital injections" after a GBP35 million investment. It also aims to cut the cost to income ratio by around 50%.
The measures are part of a "five year plan" for its financial services unit with the aim of doubling underlying pretax profit and delivering double digit returns on capital employed.
By Eric Cunha; [email protected]
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