Sainsbury's to create convenience store team

Sainsbury's is to set up a convenience division at its Holborn head office, as it plans to drive forward its Local format. The big grocer wants to capitalise on the burgeoning market, which is seen as a lucrative avenue for growth.

Sainsbury's increased convenience store focus follows Tesco's acquisition of T&S Stores last year, which made the leading grocer a big player in the smaller store sector.

Sainsbury's managing director Stuart Mitchell said he was unsure how many people would be recruited to the convenience division, but they will report to retail director Adam Fowle.

He said: 'We are taking it (the convenience market) very seriously. We have set up a convenience division to give us some focus. We want to make sure we have got the right land banks and the right customer offer and are ahead on the innovation curve.'

Sainsbury's has 57 Local stores at present, and plans 25 more this year.

The grocer has so far only opened Local stores organically, but would look at acquisitions.

Charles Stanley analyst Simon Proctor said: 'It's an area which is an easy win because the opposition is weaker than in the main supermarket arena.'

The grocer is also gearing up for a massive non-food initiative in the autumn, when a new range will be launched in 300 stores.

On the food side the grocer has launched a 'First For Fresh' push to improve availability.

Sainsbury's announced full-year profit before tax up 16.8 per cent to£667 million. Supermarket sales rose by 3 per cent to£15.3 billion.

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