?The need for continual improvement of standards has now become a permanent requisite for all convenience stores and in 2007 this will gather more focus. In addition, independent retailers in particular should look less at the competition and realise the future is in their own hands and they need to be more aware of customers' needs and changing trends. The next 12 months should also bring more collaboration and consolidation within the market as everyone seeks to maximise their buying power and influence with suppliers. I also sense the building up of a backlash by all businesses - small, medium and large - against the petty legislation that is swamping them.
Justin King Chief executive Sainsbury's
? Green issues and health concerns are now firmly rooted in the mainstream consciousness and I expect them to become ever more important. We will continue to respond to our customers' raised demands on issues as the environmental agenda, ethical sourcing etc. The challenges are responding to customers' raised environmental and ethical expectations, as well the obvious: year-round availability of great products at fair prices. We are halfway through the Making Sainsbury's Great Again recovery plan and although we are on track there is still much to do. We need to continue to deliver improved service and availability on a consistent basis while at the same time building on our strengths in quality food.
Chris Etherington Chief executive Palmer & Harvey McLane
?We anticipate that health and green issues will continue to dominate the agenda for many years to come, but rising costs and labour shortages will come to the fore this year. Demand for convenience retailing continues to expand, and with this the role of the local shop. More professionalism among retailers will be a key driver, as will be the development of chilled, fresh and functional foods. This is recognised by the major fmcg companies who are putting increased investment behind their brands in these categories to realise their potential. Our challenge will be to defray some of the underlying inflationary costs by operating more efficiently, while at the same time providing retailers with a best-in-class solution that enables them to take advantage of the growth potential of chilled, fresh and functional foods.
Benet Slay Joint managing director of Diageo
?There will be continued growth in the quality offering and Diageo will play a part with innovations such as Baileys Flavours, Quinns, Pimm's Winter and the potential development of Guinness Red. Consumers are getting great quality. The danger is that funds for innovation in the off-trade, so vital for the category growth, will be lost as we support promotion. We must engage the shopper other than on price, which quite often is not the competitive position. As we compete against electronic goods and clothing for space, we need to put more value on entertainment and theatre.