From http://www.scotland.gov.uk/cru/kd01/blue/retail-06.htm

Scottish Government document on the future of retailing that describes supermarket operations in Britain with specific references to Tesco,

J. Sainsbury, ASDA and the car maintenance and bicycle retailer Halfords.

Planning controls and store size and location

Land use planning controls have had a major impact on store size and location.

Limits on specific types of development can have multiple and direct competitive effects. For example limits on the development of food and non-food superstores:

  • improve the competitive position of some small stores that are protected from full competition,
  • improve the competitive position of the superstores already operating that are similarly protected against new competition,
  • Encourage retailers to look for alternative competitive opportunities through non-store formats and store formats unaffected by policy controls.
  • There is a range of indirect competitive effects on consumer access to stores and on traffic generation. These factors may be of direct concern, however, to other aspects of public policy. In terms of a direct impact on competitiveness, we see in the grocery sector the success of stores that have gained permission and are operating, particularly, but not only, in medium sized communities where quasi-monopoly positions are achieved as a result of a combination of market size and planning policy. We also see the search for other competitive opportunities with moves back into town centres and onto filling station forecourts by the major firms. The large firms are also exploring non-store provision to enable continuation of their market penetration and hence continued improvement of their competitive position.

    Food retailers have adopted similar responses to the constraints created by planning policy :

    J.SAINSBURY

    J Sainsbury operate six distinct store formats:

    ASDA

    ASDA has three formats:

    TESCO

    Tesco portfolio of retail formats in UK in 1999

    Source: Tesco Annual Report (1999)

    Format

    Characteristics

    Number of Stores

    Average sales area

    (sq ft)

    Tesco Extra

    Very large stores including an extensive range of non-food categories

    5

    80,600

    Tesco Superstore

    Large stores offering a full food range and many non-food products

    269

    38,600

    Tesco Compact

    Superstore

    Core superstore range, but within a more compact environment

    67

    20,700

    Tesco Supermarkets

    Supermarkets selling food ranges and household goods

    240

    13,800

    Tesco Metro

    City-centre stores providing convenience foods

    41

    11,100

    Tesco Express

    Petrol station forecourt shops selling a limited range of everyday products

    17

    2,100

    Tesco Direct

    Non-store 'internet' service based on full store ranges with delivery

    South-east England

     

    Tesco Financial services

    Internalised concession accessed through the fixed store network

    Available throughout UK

         

    639

    25,000

    Supermarkets take account of their customer base.

    Social change affecting household and personal consumption

    Examples are:

    These changes encourage a fragmentation of personal and household shopping patterns

    Social changes in the attitudes and behaviours of consumers alter the effectiveness of different types of retailing in terms of their productivity, profitability and so their competitiveness. Retailers seek more competitiveness by responding to these social changes. Several actions of retailers illustrate attempts to increase competitiveness by responding to social change.

    Changing shopping behaviour in the convenience sector has encouraged Sainsbury to identify several different segments within the convenience shopper group using Sainsbury Local stores. The names Sainsbury's have given to the segments indicate their behaviour: grab and go perishable top-up, impulse, habitual, and distress.

    Some retailers have strengthened their corporate cultures to relate to changed attitudes of consumers. Examples are Body Shop, IKEA, Planet Organic, and Peckhams.

    Demand for new products, for example mobile phones, has generated new competitive opportunities for The Link and Carphone Warehouse. Higher levels of home ownership have extended competitive opportunities for DIY retailers and for kitchen and bathroom retailers.

    Changes in personal mobility not only affect the behaviour of shoppers but also provide opportunities for retailers. For example Halfords, with over existing 400 High Street and superstore units, were trialing in 1999 seven new formats aimed at shoppers in different situations and with different needs in respect of their personal mobility:

    Not all these formats will be developed in full but the experimental approach illustrates the response to consumer demands in different situations.