Making sense of the past seven days

A week ago we were all hoping that Richard Ratner, who had suffered a heart attack, would make a full recovery. It wasn’t to be and news of his death last Sunday saddened the whole industry.

There are few senior people in retail who didn’t know Ratty and his passing away was keenly felt. Everybody had a story to tell about him and his unique sense of humour. Aside from being an astute analyst, he was great fun. He brightened people’s days and there’s no better legacy than that.

Asda and Woolies: match made in heaven?
It’s more than eight years now since Asda jilted Kingfisher at the altar and threw itself into the arms of Wal-Mart. But could a liaison between the grocer and former Kingfisher chain Woolworths be on the cards again? That’s been one of the talking points of the week after broker Kaupthing issued a note highlighting the merits of a tie-up between a supermarket group and the variety store business.

Although attention focused, unrealistically, on the likelihood of a deal with Morrisons, surely Asda would be a more realistic prospect? As we report this week, Asda has been bolstering its non-food expertise as it seeks to expand its Living chain. The latest addition to the team is Colin Haggerty, the former Ilva boss who also coincidentally used to work at Kingfisher.

However, the fact that Asda Living stores compete with Woolies on various categories would not necessarily stand in the way of a link-up. A deal – perhaps to give over space to a food retailer rather than, for instance, a merger – would make sense for Woolies, because it would allow it to offload excess square footage and a food offer would drive footfall into stores.

It’s widely suspected that Asda is interested in establishing a presence in the convenience market, where it is conspicuous by its absence, while Tesco and Sainsbury’s have expanded rapidly. A deal with Woolworths would potentially allow the development of a convenience offer.

In fact, it sounds a bit like Woolworths General Store, the convenience format the retailer experimented with several years back. Although since shelved, the idea might work with real food firepower behind it. Perhaps Woolies and Wal-Mart will yet kiss and make up.