Jan 11, 2017
Sainsbury’s Argos plan avoids catalogue of errors
This, on the face of it, was the rationale behind J Sainsbury's decision last year to pay £1.2bn for Home Retail Group, owner of the Argos catalogue retail chain. Sainsbury's chief executive, "Measured" Mike Coupe, is keen to stress that he is doing non-food rather differently. As a result, Argos overall achieved a 4 per cent increase in like-for-like sales in the 15 weeks to January 7 - dragging a 0.1 rise in Sainsbury's sales up to a more respectable 1 per cent at group level. Without a "Halo" effect - whereby visitors to Sainsbury's Argos concessions lift food sales in those stores by 1-2 per cent - it might have been worse. Says the ex-supply chain expert, Sainsbury has realised the growth potential is not in washing machines and TVs - Argos mainly offers them to sell credit deals - but in "Instant gratification non-food": the £9 kettles and £5 toys picked up in store during the weekly shop.
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