Waitrose managing director Mark Price was in London yesterday for parent John Lewis Partnership’s results.
As ever, Price was his ebullient self, but he does have more reason to be chirpy than usual.
This is not only because Waitrose posted a robust uplift in operating profit and sales for the year to January 26, but also because Price has delivered significant change in his full year at the helm and the expectation is that there is plenty more to come.
Yesterday, Waitrose registered total sales up 6.8 per cent to just under£4 billion, on like-for-likes up 3.6 per cent, excluding petrol. The grocer’s operating profit (excluding property profit) rose 22 per cent to£212.1 million.
However, it is Waitrose’s growth plans that are starting to attract more attention. In this week’s issue (March 7, 2008), Retail Week reports that Waitrose is considering launching a convenience store format, with stores of between 4,000 and 6,000 sq ft (370 and 555 sq m).
Many in the industry believe that Waitrose has been far too slow to move in on the convenience sector and that it has stood by idly as key rivals – notably Marks & Spencer, Tesco and Sainsbury’s – have parked their tanks on UK high streets.
Retail Week has learned that Waitrose’s plans for the convenience sector are separate from its interest in a tranche of Somerfield stores. Yesterday, Price declined to comment on speculation that Waitrose was still working with the Co-operative Group, which has submitted an indicative first-round bid for Somerfield.
Price remained tight-lipped yesterday about any potential plans for convenience stores. But in response to a question on Somerfield, he said: “We are looking at different sizes of formats.”
The grocer also plans to roll out design elements of its two successful new-format London stores this year – Marylebone High Street and the refurbished John Barnes stores, Finchley Road – to other stores in its 187-store estate.
Certainly, Waitrose seems to have adopted a far more proactive strategy for acquiring sites. Yesterday, Price revealed that, in addition to the eight stores it plans to open this year, it has acquired 10 sites for 2009 and plans to open 11 in 2010.
On price, Mr Price is also living up to his name and trying to shed Waitrose’s upmarket price image. Last month, Retail Week reported that Waitrose is matching Sainsbury’s prices on 300 standard branded items, such as Lenor, Lucozade, Colgate and Volvic. And yesterday, Price said that, overall, Waitrose was just 3.2 per cent more expensive than Sainsbury’s for branded lines.
When asked about the outlook for Waitrose, Price was bullish, saying that it can continue to increase sales, particularly given that the shocking summer weather is unlikely to be repeated this year. Furthermore, Waitrose also has a burgeoning international business. This year, it will open its first stores in the Gulf, via a partnership with Dubai grocer Spinneys and it also exports products through wholesale deals to 23 countries.
Waitrose has not always been viewed as the industry’s most innovative and dynamic grocer, but Price seems hell-bent on making the favourite grocer of foodies and Middle England a force to be reckoned with.