The impact of The Co-op cyber attack has been horrendous: in the barely two months after the Co-op cyber attack sales fell £206m, wiping £80m off the bottom line in its first half results and £120m for the full year.
But let’s look on the bright side. That’s a lot less than Marks & Spencer’s estimated £300m losses. And the damage could have been so much worse. ‘Zoning’ meant online sales, tills and the wholesale IT systems were maintained. And decisive action meant while the hackers downloaded the personal details of its (then) 6.5m members, they were unsuccessful in installing ransomware.
In fact there’s lots to be positive about all things considered. The skilled reduction in its crippling debt from almost £1bn in 2021 to £43m meant the Co-op was in a resilient position to withstand the cyberattack – not to mention the almost equally sizeable £70m in extra employee costs, national insurance and the packaging tax, which meant that even without the cyberattack the Co-op would have been plunged back into the red.
There’s also the determination and prioritisation of its teams who successfully found a way to maintain crucial services to vulnerable communities and also wholesale customers who could so easily have been forgotten. And not a single funeral was cancelled.
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Though it’s taking time for sales in its food division to recover, it’s also close to regaining its leading share of the quick commerce market – a testament to the strength of its rapid delivery offer, which despite minimal capital outlay, now rakes in £600m in sales and is profitable too (unlike rivals, which either operate at a loss or, in the case of most rapid delivery operators, have gone bust after losing billions).
The Co-op is also back on the front foot. While store openings slowed, 30 will come onstream in the second half, including 10 of its pioneering new ‘microstores’ – despite the first only opening in August.
The Co-op management restructure – with Matt Hood heading up a new commercial and logistics operation – and new partnership with Holland & Barrett on a Health and wellness concession also shows the Co-op is thinking hard about how convenience will evolve over the next 10 years as sales of tobacco and vapes decline.
And finally the Co-op deserves praise for its transparency, sharing its experience – and apologising to its customers – through broadcast interviews and MP briefings, even reaching out to rival retailers. The Co-op has behaved impeccably – in keeping with its values – and once again shows the food industry doing the right thing in a crisis.
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