Retail consolidation expert David Sands, who sold 28 stores to Co-op in 2012, gives his views on the recent mergers
Tesco’s £3.7bn takeover of Booker alongside the £143m Co-op and Nisa deal can only strengthen the hand of independent retailers.
The combined buying power for everyone from both mergers means retailers will be able to negotiate better pricing and higher margins.
The market must evolve. Both deals create more competition, to the benefit of independent retailers. All parties involved will be looking at each other and they want to be successful. I understand the anxiety from retailers, but Tesco and Co-op will not want to damage their reputation or lose retailers by jacking up prices.
Co-op has a network of 2,500 stores of similar size to Nisa’s, so they have more understanding of the convenience sector than any of the multiples.
Charles Wilson has listened to independent retailers like Dennis and Linda Williams and has helped them improve their stores. Tesco will use that experience.
I understand why retailers might worry about Tesco, but One Stop’s success shows the benefits of the model.
Smart independent retailers will be watching what everyone else has to offer and how they can base their future business decisions on this new market.
They’ll want to seize the opportunities.