Tesco spoiling suppliers as its own profits half

Carrefour China ramps up Easy store rollout
Carrefour China says it expects to have 10 of its new Easy convenience stores open in Shanghai by the end of this year. The French-headquartered retailer opened its third easy store on Huangjincheng Rd, in the city’s Changning District late last month. Once the network reaches 10 in Shanghai the company will start moving into other Chinese cities. The new 450 sqm store carries more than 4500 SKUs, a carefully selected range from its hypermarkets. (insideretail.asia)

Rewe investing €1.7bn in new openings and refurbishments
For the year 2015, Rewe Group will have spent around €1.7bn on the construction and conversion of around 1,100 stores, across all banners. Around 200 of these will be new stores or expansions. Discount banner Penny, which has seen some challenges in recent years, will see over 80 stores open or reopen after modernisation. Rewe is continuing to expand domestically and internationally, and by investing in modernising the estate and focusing more on fresh, it is seeing sales growth across most banners. In Germany, Rewe continues to open petrol station convenience stores, with ten now up and running. (igd.com)

UK: Tesco profits tumble by more than half
Profits at Tesco, Britain’s biggest retailer, more than halved over the first half of its financial year, crashing from £779m to £354m. Lie-for-like sales were down by 1.1% and the group warned that trading conditions remained challenging. But the figure was better than some in the City had feared and Tesco said international sales had returned to growth for the first time in three years, rising by 1%. Pre-tax profit was £74m, compared with a loss of £19m for the same period last year. Dave Lewis, its chief executive, said that Tesco had undergone a dramatic transformation in the year since he joined the business. “Every important part of Tesco has been or is being transformed operationally, culturally or financially,” he said. On Tuesday, Tesco revealed that the new national living wage would cost it £500m by 2020, putting further pressure on profits. It also announced plans to speed up payments to its smallest suppliers. (theguardian.com)

Tesco slashes payments terms to 14 days
Tesco has announced plans to slash payment terms for smaller suppliers by half, to help usher in a new era of transparency and fairness at the supermarket giant. Its smallest suppliers, selling products worth £100,000 or less in a year, will receive payments within 14 pays, its CEO revealed today. This is down from the industry standard of 28 days. The amount of time that Tesco will take to pay up varies widely by product category: sellers of fish, meat, fruit, and vegetables will be paid within 23 days, while companies supplying wine, beer and spirits, or clothing and merchandise, will still have to wait 55 days. (telegraph.co.uk)

UK: Sainsbury’s share price: Grocer to open three more Netto stores
Sainsbury is pushing ahead with its Netto chain roll-out, with three new stores to open over the “next few weeks”, CEO Mike Coupe has revealed. Britain’s third-largest grocer teamed up with Danish group Dansk Supermarked last year to bring discount retailer Netto back to the UK and fight-back against fast-growing budget rivals Aldi and Lidl. (invezz.com)

METRO closes the sale of Galeria Kaufhof
METRO Group completed the sale of Canada's Hudson's Bay Company department store chain Galeria Kaufhof, which combines the 134 facility in Germany and Belgium. The deal amounted to € 2.825bn. (malls.com.ua)

Morrison's drops its price match promise against Lidl and Aldi
Morrison’s will no longer offer customers a price match promise against Aldi and Lidl after announcing the introduction of a “simpler” loyalty scheme. The supermarket chain’s Match and More loyalty scheme will stop giving its members points if they could have bought the item cheaper at Aldi or Lidl. Instead it will change the reward system to give customers points for all purchases with bonus points attached to promotional items. (thedrum.com)

The Big Debate: Mike Coupe interviewed
In an interview with Nils Blythe, chair of The Big Debate, Sainsbury's CEO Mike Coupe gave his views on the key challenges facing the food and grocery industry. Please, click here to read more.

US: Amazon adds grocery delivery hub in Minneapolis
Amazon.com is entering the Twin Cities grocery business. The Seattle-based online retailer hasn't made a formal announcement, but detailed its plans to begin food delivery in a letter to the city of Minneapolis. (bizjournals.com)

AU: Target on track to move to new DC in Melbourne's west
Target is close to finalising a deal for a new 61,300-square-metre distribution centre in Melbourne's west as part of a broader $300m upgrade of its facilities in Australia's main cities. (smh.com.au)

AU: Price war Coles and Woolworths appears to be easing
The threat of a price war between the big two supermarkets, Coles and Woolworths, has eased, according to analysis by Deutsche Bank. “Our supermarket pricing study shows pricing in the September quarter was flat year-on-year, which is unchanged from the June quarter,” say analysts Michael Simotas and Daniel Wan. Both supermarkets have continued to cut private label prices, but Woolworths’ investment in branded products moderated slightly. Coles has continued to control its pricing with branded goods showing strong inflation. Deutsche Bank says the price gap between Coles and Woolworths is now similar to 2012. Deutsche Bank creates an index of prices of seven discrete baskets of about 100 goods across Coles, Woolworths and IGA. In the September quarter, fresh food prices fell 3.2% compared to a deflation of 1.6% in the June quarter. Most of this was fruit and vegetable prices. (businessinsider.com.au)

Bosnia’s Bingo denies sale to Lidl
Bosnian retail chain Bingo has denied local press reports that it will be sold to German discounter Lidl. In a statement, Bingo said there has been no contact with Lidl, nor have any negotiations taken place regarding a purchase or sale of its activities. (esmmagazine.com)

US: Village posts increased sales, earnings in Q4
Village Super Market on Tuesday said increased sales at replacement stores in Morristown and Sterling, N.J., drove higher quarterly sales and earnings during the fourth quarter and fiscal year. For the period ending July 25, sales increased 2.3% to $405.8m, with comparable-store sales also increasing by 2.3%. Same-store sales increased as a result of higher sales at the replacement stores, higher average transaction size and increased customer counts. It expects same store sales in fiscal 2016 to range from a 1% to 3% increase. Net earnings in the period totalled $6.9m, an increase of 16.9% from the fourth quarter last year. (supermarketnews.com)

Irish Supervalu to insure shoppers
Grocery retailer SuperValu has entered the insurance market, offering its customers discounted car and home insurance rates. (irishexaminer.com)


Food City grocery store now offers curbside pick up
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Flipkart launches hyperlocal delivery app Nearby
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SoftBank may lead $100m round in Grofers
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