As availability for supermarket new build becomes limited and increasingly expensive it is no surprise that both Asda and Morrisons look toward small Format Development in order to continue footage growth. Asda, who are no stranger to Format Development for small stores, sold 16 of the original 195 Netto stores to it’s Yorkshire rival for £28.1M. With only 47 of the 195 having to be sold on, Asda clearly need to get their format working as it has never done before and we looked today at how the two Companies have made progress.
Both Netto stores were in the homeland of Yorkshire and inhabited similar buildings with a very similar demographic profile. I could go on ad infinitum about the differences between these two organisations but in truth a morning spent at each of them would tell you most of what you need to know, they act as a microcosm for the businesses as a whole. Both store formats added enormously to the previous poor Netto provision and no doubt customers would recognise the improvements in fit, finish and range. They would also be surprised about the pricing and although there was nothing overt about contesting previous Netto prices there was strong promotional space in both stores. I liked both stores feel and layout and with the exception of the butchery counter at Morrisons they offered the same format. This is however where it all ends, as no matter what you like about the offer, the differences in the standards will mean that one shopping trip will end in some frustration, Asda simply had too many gaps, everywhere. I discussed the visits with one of my colleagues, a former Asda retailer, who leapt to Asda’s defence in suggesting that this was because of volume taken. I have to say that if this was the case then having that many on a Friday morning suggests they are not ready for the trade they get and the fact that Morrisons at Armthorpe seemed busier by some distance would suggest otherwise. If today’s visits give an indication of how things will progress then Asda have some catching up to do against a well formatted, well signed and well run Morrisons.
Two visits are not enough to make this leap of course but in large stores gaps are less apparent and Asda can get away with it, in small stores that luxury is not afforded you and at present Morrisons are best placed to make it pay.
Visit our Format Development page for more information.
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