40 Stores to close....

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Re: 40 Stores to close....

Postby pabenny » Fri Apr 27, 2018 6:10 am

William Joseph1 wrote:Not sure why people think this is all new. The retail world has been evolving for years. As long as companies are run by people the market will continue to evolve. I predict there will be good news and bad news.


Change in retail is not new. Woolworths died because its management allowed it to become irrelevant. The shoe shops that proliferated on the high street are gone because their owners saw it as a property play and burdened the businesses with debt.

What is new(ish) is an overall decline in demand for retail space. Most Woolworth sites were let fairly quickly to other retailers. Ditto Dolcis, Freeman Hardy Willis, Adams Childrenswear, etc. Today, shops that close are not being re-let and the only part of retail that is growing is online. Even growth in coffee shops and restaurants has halted. The inflexion point was several years ago (although these things are often only visible with hindsight).

Some people who should know better haven't realised this: the local authority in Northwich in Cheshire completed a new retail development intended to turn around a very dowdy town centre. Apart from the anchor tenants Asda and Odeon, it remains empty. I'm glad my council tax doesn't have to support that white elephant.

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Re: 40 Stores to close....

Postby pabenny » Sun Apr 29, 2018 11:08 am

Poundworld joining the list of stores retrenching, with a CVA proposed and around 100 stores (more than a quarter) expected to close.

https://www.independent.co.uk/news/busi ... 23496.html

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Re: 40 Stores to close....

Postby planteria » Mon Apr 30, 2018 7:28 am

yes, saw that last week... and the Sainsbury's Asda merger is all part of the process too.

http://www.bbc.co.uk/news/business-43945254

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Re: 40 Stores to close....

Postby Boro Boy » Mon Apr 30, 2018 2:02 pm

The Sainsbury's/Asda merger is promising no store closures but at the same time the benefit of 10% off all basic grocery costs to shoppers... On the basis this is unlikely to be allowed to eat into profits and the reduction to top management is unlikely to fund this - then it may be the poor supplier who may be the one with the short straw.... The worry is that the supplier cuts back on quality to meet cost targets etc. The only other alternative is cutting back on the staffing overhead maybe?

Just cant see how the new company with be able to justify to itself not closing down stores when they are sometimes almost next door to each other on the same shopping park... I guess watch this space...?

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Re: 40 Stores to close....

Postby William Joseph1 » Mon Apr 30, 2018 2:30 pm

Boro Boy wrote:The Sainsbury's/Asda merger is promising no store closures but at the same time the benefit of 10% off all basic grocery costs to shoppers... On the basis this is unlikely to be allowed to eat into profits and the reduction to top management is unlikely to fund this - then it may be the poor supplier who may be the one with the short straw.... The worry is that the supplier cuts back on quality to meet cost targets etc. The only other alternative is cutting back on the staffing overhead maybe?

Just cant see how the new company with be able to justify to itself not closing down stores when they are sometimes almost next door to each other on the same shopping park... I guess watch this space...?
The MD of Sainsburys is promising No store closures or job losses saying that they will be managed as two separate companies. It is likely to be two or 3 years before any cost cuttings are achieved and has yet to be approved by the Monopolies & Mergers Commission. I prefer to wait for the time being and not speculate on what or might not happen. The reality is often very different from the wish list.

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Re: 40 Stores to close....

Postby Boro Boy » Mon Apr 30, 2018 2:39 pm

William Joseph1 wrote:
Boro Boy wrote:The Sainsbury's/Asda merger is promising no store closures but at the same time the benefit of 10% off all basic grocery costs to shoppers... On the basis this is unlikely to be allowed to eat into profits and the reduction to top management is unlikely to fund this - then it may be the poor supplier who may be the one with the short straw.... The worry is that the supplier cuts back on quality to meet cost targets etc. The only other alternative is cutting back on the staffing overhead maybe?

Just cant see how the new company with be able to justify to itself not closing down stores when they are sometimes almost next door to each other on the same shopping park... I guess watch this space...?
The MD of Sainsburys is promising No store closures or job losses saying that they will be managed as two separate companies. It is likely to be two or 3 years before any cost cuttings are achieved and has yet to be approved by the Monopolies & Mergers Commission. I prefer to wait for the time being and not speculate on what or might not happen. The reality is often very different from the wish list.


Comments are that in the past the Monopolies and Mergers Commission would have not allowed such a grouping on the 2nd & 3rd placed largest food retail companies but times have changed and it is more than likely to go ahead now. Besides that, changes don't wait until the date of merger, they are likely to be start planning and implementing change well ahead of this time, so its worth being aware of them before they bite. :thumbup:
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Re: 40 Stores to close....

Postby Constantine » Mon Apr 30, 2018 3:32 pm

Boro Boy wrote:Comments are that in the past the Monopolies and Mergers Commission would have not allowed such a grouping on the 2nd & 3rd placed largest food retail companies but times have changed and it is more than likely to go ahead now. Besides that, changes don't wait until the date of merger, they are likely to be start planning and implementing change well ahead of this time, so its worth being aware of them before they bite. :thumbup:


Monopolies and Mergers Commission? That went in 1999. Then we had the Competition Commission until 2014, now we have the Competition and Markets Authority.

It was the Competition Commission that blocked Sainsburys,Tesco and ASDA from buying Safeway in 2003. The Morrissons deal was allowed to go through giving Morrissons a 14.6% market share.Today Morrissons has 10.6%.80%of M&A deals don't work.

I can't imagine that this deal won't be referred to the CMA. I doubt there will be any changes implemented until the CMA has reported. Even if it's a yes, expect conditions.As in store sales.

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Re: 40 Stores to close....

Postby William Joseph1 » Mon Apr 30, 2018 3:35 pm

My bad, I got the wording wrong. Perhaps, I live in the past just a tad to much.

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Re: 40 Stores to close....

Postby expressman33 » Mon Apr 30, 2018 5:25 pm

Boro Boy wrote:The Sainsbury's/Asda merger is promising no store closures but at the same time the benefit of 10% off all basic grocery costs to shoppers... On the basis this is unlikely to be allowed to eat into profits and the reduction to top management is unlikely to fund this - then it may be the poor supplier who may be the one with the short straw.... The worry is that the supplier cuts back on quality to meet cost targets etc. The only other alternative is cutting back on the staffing overhead maybe?

Just cant see how the new company with be able to justify to itself not closing down stores when they are sometimes almost next door to each other on the same shopping park... I guess watch this space...?


Agreed , someone has to pay for lower prices so it will obviously fall on the suppliers.
Where I live there are 2 Sainsbury's stores about 2 miles apart, but both have an Asda store within 100 yards of each one.

I wonder what will happen to things such as the "Asda price Guarantee" and Nectar points

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Re: 40 Stores to close....

Postby planteria » Mon Apr 30, 2018 5:46 pm

it is nailed on that the CMA will be looking at this closely Constantine. word around the campfire is that the grocers expect it to go ahead, but as you say I'd have thought there are going to be conditions.

expressman33 wrote:I wonder what will happen to things such as the "Asda price Guarantee" and Nectar points


it will be interesting to see.. Sainsbury's Nectar is the only significant challenger to 'Clubcard', with Morrisons very late to the party and changing format. all of that Clubcard data has to be useful to Tesco, and Nectar must lead to some loyalty to Sainsbury's, BP etc... fwiw we collect both Clubcard and Nectar points. but Asda has gone entirely the other way, making a point of not offering a loyalty card scheme with statements to the effect that their customers don't want them, and that all they want is simple, straight EDLP. let's see how it plays out.

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