NEWS ShopTalk A

proposed merger of Sainsbury’s and Asda could lead to higher prices, less choice for

shoppers and ‘squeezed’ suppliers, rival supermarkets and wholesalers have warned.

high market shares,” a summary of the comments from the CMA said.


Plans for a £12bn merger between the grocery giants were announced in April but the deal must be approved by the Competition and Markets Authority (CMA) before moving ahead. In addition to fears surrounding reduced choice for consumers, concerns have been raised that the deal could result in a lack of innovation from the nation’s supermarkets, according to a summary of responses to the proposals published by the CMA. Supermarket groups, suppliers, trade associations, not-for-profit organisations with an interest in the grocery sector, local Government ministers and members of the public were among those to comment on the impact the merger could have on competition.

“A number of submissions raised concerns about the impact of the proposed merger at the national level, on the belief that it would lead to increased concentration in the market and fewer national players, with two companies – Tesco and the combined Sainsbury’s/Asda – holding

6 July 2018

ike-for-like sales at Tesco rose by 1.8% in the 13 weeks to 26 May 2018, with sales in the UK and

Ireland up by 3.5%, according to the supermarket’s annual report published on Friday 15 June.

Wholesaler Booker, which Tesco bought last year in a takeover worth £3.7bn, also reported strong sales growth with a rise of just over 14%. Dave Lewis, Tesco’s chief executive, said that the grocery giant had cut prices by up to 7% since 2015, contributing to a further £300m of sales in the UK alone.

Tesco’s price cuts come as the Big Four retailer has tried to cement its position as the UK’s most influential retailer and fight off competition from discount grocers Lidl and Aldi. Mr Lewis said: “Our growth plan is on the track we set for it. We are beginning to realise the growth potential of the merger [with Booker].”

Freddie Lait, chief information

been significant progress towards accessing new growth opportunities with supplier partners. Synergies such as this will drive margin expansion in the future.”


celand has warned that earnings for the first half of this year will be lower than the previous year, due to a slowing grocery market and other factors.

While overall sales grew by 8% to £3.016bn in the 53 weeks ending 30 March, like-for-like sales in the year to date are negative.

In an update, the supermarket chain said that the market had slowed and it expected core earnings to fall “as a result of sales performance, increased staffing costs driven by the rise of the national living wage, the effect of rising oil prices on both consumers’ disposable income and distribution costs, and the timing of our marketing expenditure”.

The third quarter was seen as giving “strong scope for profit recovery”, however.


officer and founder of Latitude Investment Management and a Tesco shareholder, said that there are: “a number of additional growth drivers which could help double margins over the next few years. There has

ajestic Wine has reported a profit after booking a loss this time last year, as well as

growth in sales.

Group sales were up 2.3%, mostly driven by 11.3% growth in the Naked Wines division. Meanwhile, the Majestic Retail stores grew underlying sales by 1.9%.

Profit before tax came in at £8.3m, putting the business back in the black after a £1.5m loss in 2017. Chief executive Rowan Gormley said: “If the UK is headed for a retail

crisis, as some commentators are suggesting, then we are planning for a great crisis. We founded Naked Wines during the financial crisis of 2008 and proved that investing in acquiring customers and generating loyalty through great products and service, will drive profitable growth even in a tough market.”


arks & Spencer has announced plans to close two Simply Food stores West

London’s Ruislip and Fulham .

The retailer said it has made the decision not to renew the leases at Ruislip Simply Food and Fulham Island Simply Food stores, meaning they both will close this summer. The announcement comes after M&S reported a 61.1% fall in pre- tax profit to £66.8m in the year to March 31, as it was dragged down by £321.1m in costs liked to store closures.

It has said it will shut more than 100 outlets by 2022 as it pushes forward with a transformation that will see thousands of jobs put at risk. No specific date has yet been set for the closure of both stores. M&S said the employees in Fulham and Ruislip will be relocated to nearby stores.

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