Sainsbury’s £72M loss – retailer to target convenience market

Sainsbury’s has revealed a change in tactics after reporting losses of £72 million over the past 12 months.

In its annual results, published yesterday, the retail giant outlined plans to open “one to two” convenience stores “per week” as it attempts to capitalise on the movement away from the traditional weekly shop.

Sainsbury’s results represent its first annual losses in ten years, and come within weeks of Tesco reporting unprecedented losses of some £6.4 billion.

Along with falling grocery prices and a drop in like-for-like sales due to pressure from German discounters Aldi and Lidl, the retail giant said much of the loss was down to cuts in the value of its properties.

The retailer said it had taken “decisive action”, and reiterated commitments to cutting 800 jobs over the next 12 months.

Its chief executive Mike Coupe said: “The UK marketplace is changing faster than at any time in the past 30 years, which has impacted our profits, like-for-like sales and market share.

“However, we are making good progress with our strategy, and our investment in price and quality is showing encouraging early signs of volume and transaction growth.”

Sainsbury’s has already opened 98 convenience style stores over the last year, and said it has identified sites to trial its new format to make its shopping experience “easier and more convenient”.

The strategy mirrors plans by Tesco to move away from mega-stores and expand its number of Express outlets.