Just over three years ago I visited one of the best convenience stores in the country – a Morrisons M Local.
Those familiar with the current incarnation of Morrisons’ convenience offering may well be surprised to hear that, but the store in question was in fact Morrisons’ first-ever c-store, in Ilkley, West Yorkshire, and my visit was on opening day.
Morrisons’ then-CEO Dalton Philips had gathered the great and good of the national press together to unveil what was to be the next generation c-store. It did not disappoint.
Yes, Morrisons was a ‘Johnny-come-lately’ to the format, but by heck it delivered something worth shouting about. Not only did it look terrific but the range was exceptional – 40% of the 2,270 lines were fresh food lines, much more than any of its rivals, and not only that but the price of these lines were exactly the same as it Morrisons larger stores.
Availability and waste issues were largely eliminated due to the innovation model whereby these fresh lines would supplied via five daily deliveries from the nearby 40,000 sq ft superstore in Keighley.
And while a small proportion of the store’s ambient grocery lines did cost more than at a larger store, the ‘tilt’ was not as high as rivals. On top of all this, with its electronic shelf-edge labels and subtle lighting, the store looked fantastic while the customer service rivalled that of the very best independents.
At the time the only concern was if the retailer could open enough of these fantastic stores before its rivals nicked all Morrisons’ best ideas for their own c-stores.
As it turns out that was a meaningful concern – today Morrisons has around 150 c-stores but they are not carbon copies of the first brilliant stores. The hub and spoke model was clearly not a financially viable one – the costs of keeping a store trading to such high standards proved prohibitive, a situation that was only exacerbated by the straitened economic times we have experienced in the last few years.
The M Locals of today are serviced in the traditional way via DCs rather than a nearby mothership supermarket. And it completely lost its way in terms of ranging: few if any of the M Locals offer the same choice and excitement first seen in Ilkley. What’s more, in the rush to reach critical mass, Morrisons paid over the odds for stores in locations that were far from ideal.
In March, Morrisons pushed the ‘pause button’ on its c-store ambitions and it now appears that it is close to hiving off the business to a group of investors led by Greybull Capital.
Morrisons CEO David Potts is quite rightly focused on the group’s core supermarket estate - which he urgently needs to get firing again - and so it is understandable that he might look to offload a more peripheral part of operations. That fact that he might be willing to jettison convenience, which in the current climate is bang on trend in terms of where the shoppers are, is a rather sad indictment of the job Morrisons has made of convenience.
In just under four years, Morrisons took its c-store offering from the sublime to the ridiculous. The question is: what are the potential new owners likely to do with the stores? Read this week’s issue of The Grocer to find out more about the secretive Greybull and its possible plans.