The Co-operative Group has reported early success from its ongoing food strategy True North.
Speaking at an update event this morning, Co-operative Group head of retail Steve Murrells revealed like-for-like sales at The Co-op’s convenience stores in the past four weeks were up nearly 4%.
He also revealed the rebranding of its core own-label offer Loved By Us, launched in August last year, was paying off. Sandwich sales were up 14% in the past four months, ready meals up 18%, pies up 17% and pizzas up 15%.
He also confirmed the society would continue to sell off its bigger supermarkets – stores over 10,000 sq ft – but open more convenience stores. It currently has 2,000 c-stores but would eventually double its estate by opening at least 150 stores a year with “a shop on every corner and in every community”.
The society’s own-label offer would also increase from around 3,000 to 4,000 lines this year to help bring its own-label penetration closer to that of Sainsbury’s, Waitrose and Marks & Spencer.
And Murrells added that there was “enormous headroom” for growth because The Co-op’s sales per square foot in its c-stores were around £13 – against about £25 at Tesco and Sainsbury’s c-stores.
Around one-third of its store estate would also be updated this year. The society is currently conducting 17 Generation Two pilots across the UK, following the success of Generation One stores last year.
Murrells said he was “very excited” about the performance of Generation Two stores, which have been designed based on three key shopper missions: top up, shop for today, and food to go.
Like-for-like sales in these stores were currently up by double digits, with average basket spend up 7%.
Murrells added that the food business was the “number-one priority” for the group. Although trust had fallen in the wake of the Paul Flowers scandal in November last year, this had “quickly returned”.