Co-op retailers buck the market with a successful Christmas

The member-owned businesses enjoyed a busy festive season, bringing a boost to like-for-like sales

Industry analysts have painted a gloomy picture of Christmas trading for the grocery sector but retail co-ops have produced more upbeat results.

Market researcher Kantar said year-on-year supermarket sales grew marginally by 0.2% in the 12 weeks to 29 December. Overall, retailers took a record £29.3bn through tills in the final quarter – up £50m on the previous year, but 2019 saw the slowest rate of growth over the Christmas period since 2015.   

But it adds that the Co-op Group’s 3% growth was ahead of the market, and enough to increase its share by 0.2 percentage points to 6.1%.  

Much of its success was fuelled by chilled products, with fresh poultry sales up by 10% and convenience items like pizza up 9%.

The picture was similar elsewhere in the retail co-op sector. Midcounties Co-op reported a 3.3% increase in like-for-like Food sales in December, with its busiest ever Christmas Eve and sales of locally sourced products up 28% in the week before Christmas.

A dozen first-time local suppliers, including Beau’s Bakehouse, Cottage Delight & Godminster Cheese, added their products to the range and proved popular with customers.

Rupert Newman, Midcounties’ chief retail officer, said: “Our excellent seasonal performance is a credit to the hard work of our colleagues and suppliers who worked so hard to provide our customers with the very best products and service during December.

“They include all of the valued suppliers that contribute to our Best of Our Counties range of locally and ethically- sourced food and drink products. Our stores offer a number of products that are sourced from within the store’s home or neighbouring county, which reduces food miles and means that our customers know exactly where their food comes from and how it has been produced.”

Midcounties supports 40 local food banks and donated 100,000 grocery products by the end of December – enough to provide meals to more than 2,500 families.

Lincolnshire Co-op also reported figures ahead of the national trend, with food store sales rising 7.2% in the period from 14th December to 4t January.

It also beat the market in terms of certain traditional items; while Kantar reported that overall, UK sales of Christmas puddings fell 16%, Lincolnshire Co-op saw sales of the dessert rise by 35%. Sales of mince pies up rose 36% with nearly three quarters of a million sold.

Each food store stocks the Love Local range, featuring goods from Lincolnshire Co-op’s trading area, and sales increased by 9.5%.  Local products from suppliers including Lymn Bank Farm, Cote Hill and Lincolnshire Poacher contributed to overall cheese sales going up by 22%.

More people bought locally sourced meat from suppliers including Grasmere Farm, Mountain’s Boston Sausage and Uncle Henry’s, while the society’s own bakery Gadsby’s, based in Southwell, saw sales increase by 11%.

Lincolnshire paid out a dividend bonus of £1.9m to its members on 1 December. Dividend Card holders further boosted their balance with 10% extra dividend vouchers, which contributed to another £391,679 in dividend being shared during the month.

During December, members redeemed more than £1.3m of dividend from their cards to pay for their shopping in food stores.

Chief retail officer Mark Finn said: “We’re delighted to buck the national trend, both with the popularity of the traditional Christmas pud and with our positive sales performance.

“It’s a great achievement in a tough market. It shows that our customers appreciate our colleagues and the service they provide and the quality of our products, especially those sourced locally.”

East of England Co-op reported strong sales over the three weeks ending 4 January, with a 5.4% like-for-like increase in its Food division.

Throughout December East of England performed well, achieving a 4.8% sales increase, supported by a strong marketing campaign including two Christmas themed door-drops.

Roger Grosvenor, joint chief executive, said: “We are more than delighted to have achieved such a positive performance. Despite the poor weather and intense competition, sales of Christmas goods was excellent, with 90% sell through. Other standout areas included fresh foods, especially fruit and vegetables, and Deli to Go.

“For the first time, all East of England members were able to earn double dividend points on qualifying spend throughout December. This was supported with an offer for 15% off four bottles of wine. We also traded on Boxing Day, as we have for the past four years, achieving a 46% like-for-like sales increase.

“Our colleagues went the extra mile, creating a real festive feel for our members and customers. While the FRTS promotion package hit the right note.”

Christmas sales figures for 2019 have shown that customers are continuing to choose local co-operative convenience when shopping during the festive season.

Southern Co-op reported a 4.7% increase in like-for-like sales in the four weeks to 29 December.

The sales increase was seen across a range of products including core lines as well as seasonal food and drink. While mince pies proved as popular as ever, other products selling well included the range of Co-op Irresistible snacks and festive bouquets

Mark Smith, Southern chief executive, said: “Our teams across the business have worked hard to ensure that stores offer our communities a reliable place to pick up their essentials as well as those festive treats over the holiday period.

“We’re pleased with the sales growth over Christmas this year which builds on a solid sales performance through 2019. This reflects on going improvements in store operations and the growing popularity of the Co-op range of products we offer.

“We’re extremely grateful to all our hardworking colleagues who’ve made this possible, and to our customers for their support. It’s a strength of our co-operative model that local people can share in our success, not least, through our continued support of local causes across the south.”

Heart of England Co-operative said Christmas Eve was the most successful trading day ever for its food division, while overall sales for the festive period bucked the trend with an increase of 6.86% in the three weeks to 4 January, and like for like sales over the same period up 5.18%.

Steve Browne, general manager of the society’s food division, said investment had brought improvements to the appearance of stores and the quality of food ranges had paid off, as as the Local @ Heart campaign to encourage members and customers to buy local produce

He added: “Weak consumer confidence resulting in shoppers reining in their spending may well also be a factor in our success, with people preferring to watch their pennies, spending little and often close to home rather than overspending in supermarkets and throwing unused goods away.

“We are delighted with the sales performance overall – particularly with the increase at New Bilton, which underwent a £750,000 last year, Attleborough, which was the subject of a £600,000 upgrade, and Southam, where we spent £507,000 on upgrading the store.” 

Heart of England begins the new year with two new stores – a £1.8m facility in Burbage, Hinckley, Leicestershire, which is part of a wider £4.5m investment for a new retail park complete with seven units, and a £2.1m facility in Hockley Heath, Solihull – the largest single investment in a food store in the society’s history.

Central England Co-op announced a 3.5% increase in sales over three festive trading weeks ending 4 January.

Increased sales were achieved in fresh produce and protein ranges, food to go sandwiches and party food such as pizzas and ice cream.

The stores also saw an overwhelming public response to the retailer’s first ever Christmas Toybox Appeal, with more than 12,000 brand new toys donated by customers and members. These presents were distributed to children in need by 25 organisations uch as food banks and hospitals. The society’s Christmas food bank appeal saw more than 40,000 items donated, – creating over 20,000 meals.

CEO Debbie Robinson said: “I am delighted to say that the hard work and commitment of our colleagues, coupled with great products and planning, has allowed us to record positive sales figures over the festive period.

“Our Christmas success, alongside a solid performance during 2019, will ensure that during 2020 we will be able to continue to share our success by supporting great local good causes and making a positive impact in our local communities.”

Channel Islands Co-op said a slow start to the season trade started to pick up on the final weekend before Christmas and grew steadily on the Monday and into Christmas Eve.

There was a strong like-for-like performance over the 12 weeks to 29 December, reporting 2.46% (inc Fuel) and 2.53% (Food only).

The society said its smaller stores performed particularly well, supplemented by a great performance across its PFS Estate. Although slow to take off, its large stores still reported excellent sales in the final two weeks.