May 12, 2022
Why convenience stores are still worth sparring over
The triumph of Wm Morrison over EG Group, the vehicle of the Issa brothers who own Asda, in a tussle over an unglamorous retail asset shows the sector is not yet yesterday's news. As Steve Dresser of Grocery Insight puts it: "What did McColl's stand for? Nothing in reality, as a brand name." The Co-op deal stuck McColl's with stores that were not trading well under that well-understood identity. Jobs have been saved by the sale, a decent chunk of the McColl's portfolio seems destined to be run down over time. "If McColl's had gone bust or been bought by someone else, Morrisons' supply deal would have been screwed up and hundreds of the Morrisons Daily stores would have had to be de-Morrisonised," says retail consultant Graham Soult. Mini-supermarket style stores charging premium prices to compensate for city centre rents will probably find themselves vulnerable to a consumer spending squeeze when there's an Aldi or Lidl down the road. Unlike flashy tobacco packets and weekday broadsheets, convenience stores will survive.
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