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    INTERNATIONAL NEWS

    Sainsbury's purchases Jacksons stores; Association of Convenience Stores concerned.

    LONDON -- Sainsbury's boosted its presence in the booming convenience store sector when it announced the acquisition of 114 Jacksons shops in Yorkshire and the north Midlands of the United Kingdom.

    Sainsbury's -- Britain's third-largest supermarket group -- did not reveal the cost of the deal, but Jacksons had turnover of £143m in the year to April 24 and has net assets of £25.5m.

    The convenience market is one of the fastest-growing segments in food retail, with the big supermarket chains buying up smaller stores because of strict limits on building new supermarkets or expanding current facilities. There are 55,000 convenience stores in the United Kingdom, in a market worth £23bn. The sector grew 7.3 percent over the past year.

    The purchase of Jacksons -- which employs 2,350 people -- is the second convenience sector acquisition by Sainsbury's. The company bought Bells Stores in February.

    Sainsbury's currently has 67 Sainsbury's Locals, 54 Bells Stores, and a further 22 stores in partnership with oil giant Shell. The acquisition of Jacksons means it now has more than 250 convenience stores.

    "When we announced the sale of Shaw's, our U.S. supermarket business, in March, we indicated that we would use a proportion of the funds to expand further into the convenience sector," Justin King, CEO of Sainsbury's, said. "This acquisition provides us with a great opportunity to do that."

    The Association of Convenience Stores (ACS) is seeking talks with the Office of Fair Trading after Sainsbury's latest assault on the multi-billion pound convenience store sector. ACS members fear industry heavyweights will simply use their size to sell goods at below-wholesale prices and are pressing for a ban on the tactic.

    The association wants transparency of buying prices amid concerns that the big supermarkets can negotiate better terms and conditions with suppliers than smaller retailers.

    ACS CEO David Rae said the implications of the latest acquisition involving Sainsbury's would be felt "widely and acutely" in the grocery sector. Safeguards should be introduced to establish a "more level playing field" in the grocery market, possibly via a strengthened supermarket code of practice, he said, adding, "Otherwise, the government will be forced to legislate when choice and diversity have all but disappeared."

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