We are in the food business, which is less vulnerable to these economic trends. People have to carry on eating to survive. What they may do is change their eating habits. They could trade down, buy differently or shop around more. We have invested heavily in our economy range to improve the look and quality of the product and this has started to pay off. It is growing rapidly and this year there will be more new lines than ever. It is difficult to say whether premium ranges can succeed in this climate. These ranges will only grow if suppliers seize the opportunity and offer good consumer-led promotions. This is an opportunity for suppliers to be creative and use their initiative. We will work with them to help grow sales and improve choice for retailers and their customers.
Focus is driving profit - Buying group ?
When money is tight people will naturally spend differently and will look for more value. However, this doesn't necessarily mean going to the multiples and it does give the good independents a chance. The credit crunch gives indies the opportunity to boost sales and promote their value offering on a more regular basis as people could be inclined to opt for smaller shopping baskets and shop more locally. Overall, of course, the price war with the multiples was lost a long time ago. But if independents get their range, offer and promotional activity right they can take on the multiples and discounters on a value basis on occasion. We carry a very small value range and we are looking at extending it but at the moment we are focused on our premium range. We have to offer value for money across the board.
Still creating footfall - Cash & carry and delivered operator ?
Current thinking is that independents do slightly better in difficult times as consumers try to buy little and often locally rather than put £100 on the credit card in Tesco. If things took another turn for the worse this thinking may be tested. Independents still find it very hard to compete on price and some of the big headline-grabbing offers. However, on normal shelf pricing and promotions, independents can compete very effectively in spite of the known discrepancies of buying prices between the multiples and the independent sector. Consumers trade up in these times, treating themselves at home rather than going out regularly. But this is not necessarily to the benefit of independents. There may well be a treat factor influencing trading up in wines, spirits and even premium beers through independents, but the multiples' dominance of premium ranges of food will mean that in this area any benefit will be theirs.