Profit margins among the UK’s biggest independent grocery retailers have dropped to their lowest since 2009, The Grocer’s annual Top 50 has revealed.
With B&M Retail, one of the fastest growing and most profitable players, dropping out of the Top 50 following its acquisition by CD&R, pre-tax profits among the 43 companies where figures were available fell 14% to £193.4m last year.
Hardest hit were Berry Bros & Rudd (-95%), Snax 24 (-82%), Brobot Fuels (-71%) and no1 indie Wilkinson (-63%).
As a result, profit margins fell from 2.9% to 2.3%. If B&M had been included, profits would have increased by 3%, but margins would have decreased from 3.3% to 3.1%. The absence of high-flying B&M highlights the margins of the remaining discounters: profits fell 2% to £154.4m, with margins down from 4.2% to 3.7%. If B&M were included, margins would have risen from 5.6% to 5.9%
Overall sales for the Top 50 rose 9% to £8.3bn, with store numbers up 6% to 5,161 and staff up 4% to 85,567.
Top performers in terms of sales included Poundworld (56%), WineFlair (41%), new Top 50 entrant North East Convenience Stores (37%), and TJ Morris (27%).