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Today’s not-so-supermarkets will have to adapt and overcome

Back in 2007, social campaigner Andrew Simms published a book called Tescopoly, which warned of the horrors of the seemingly inexorable spread of the UK’s largest retailer.

On the back cover, John Bird, founder of The Big Issue, was quoted: “Simms shows the creeping, invading, unsustainable world of the supershop, its tentacles strangling the life out of our communities.” Celebrity cook Hugh Fearnley-Whittingstall pitched in with: “An eloquent and persuasive account of modern corporate greed, and how and why we should resist it…”

I have never been a fan of major supermarkets as I don’t like shopping in giant sheds, but I found the book unreadable because of its almost hysterical bias against the juggernaut. I had more than a little sympathy for its message, however, because at the time it did seem like Tesco was a giant steamroller that would crush every rival beneath it.

How things change. Despite the internal difficulties Tesco is experiencing due to its well-publicised and frankly disgraceful accounting irregularities, the entire supermarket sector is caught in a perfect storm of a tight economy, sharper competition from hard discounters like Lidl and Aldi and changing consumer behaviour - more smaller shopping trips, fewer big weekly ones - and the rise of online shopping.

This week Mark Price, boss of Waitrose, admitted he expected big grocers to have to start closing shops to respond to these significant changes. Tesco apparently scrapped the openings of two new stores recently, even though they had been built. Mike Coupe, chief executive of Sainsbury’s, said a couple of weeks ago that 25% of his estate was not performing well enough.

What’s interesting for the Drapers reader about this - apart from where our food and drink might come from - is what effect this reshuffling of the supermarket deck will have on the clothing businesses built up by Tesco (F&F), Asda (George) and, in a distant third, Tu by Sainsbury’s. (Morrisons’ Nutmeg kids’ line is small by comparison.)

The impressive success of the fashion side of the supermarkets has been built on a model of high footfall in a low-cost unit. Hence their achievements towards the value end of the market. The interesting consideration now is whether they will be able to flex or totally overhaul the formula to open standalone stores in locations other than out-of-town parks. Here at Drapers we constantly hear rumours that F&F is planning to open solus units; I can see it happening. As we already know, that out-of-town pioneer Matalan is experimenting with high street units.

The about-turn in fortunes in the mighty Tesco - which still is a huge retail force, let’s not forget - is a reminder that we should not get carried away with warnings of inevitable changes in our habits. Just like the Millennium Bug that never appeared, I don’t expect us all to be buying everything over the internet anytime soon and I do not believe magazines will disappear in favour of online journalism. What do Drapers’ readers think?

Included in this issue is the Winners’ Brochure for the Drapers Awards. It was another stellar line-up of retailing and supply talent, so well done to all the finalists and winners. I was particularly pleased to see our two personal awards go to women, who represent two generations of British success. Net-A-Porter founder Natalie Massenet, paired with her recently retired chief executive Mark Sebba, was a popular choice for our Fashion Retailing Personality of the Year category, while Betty Jackson was the first female recipient of our Lifetime Achievement Award. Each is a fine inspiration to women in the industry.

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