Morrisons blames McColl’s for sales slump

Morrisons has blamed “lower total sales at McColl’s” for affecting like-for-like growth across its wholesale business. 

According to results for the 22 weeks ending 5 January, annual like-for-like sales in Morrisons’ wholesale business were flat, while sales in its third quarter dropped by 0.1%, compared with 4.3% growth the previous year.

Performance of its wholesale business was claimed to be negatively affected by poor sales at McColl’s – its largest retail supply contract. 

The convenience chain’s revenue for the year ending November 24 was down 1.9%, which it had blamed on the weather and its reduced store count.

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However, Morrisons added that wholesale sales were strong elsewhere and at the 10 trial stores McColl’s converted from its own brand to the Morrisons Daily fascia last year.

The results revealed plans to extend the trial to another 20 stores during January and February to “tailor and test the proposition as we begin to transition McColl’s remaining ex Co-op stores to Morrisons wholesale supply”.

Elsewhere, like-for-like sales in the supermarket’s retail business fell by 1.7% in the 22-week period. 

Chief executive David Potts blamed “an unusually challenging period”, but said growing margins meant the multiple was still on track to hit its forecasted full-year profit, despite the sales lull.

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