Netto set to return with Sainsbury’s partnership
DANISH discount supermarket retailer Netto is teaming up with Sainsbury’s and is plotting a return to the UK.
The first stores will open in the north this autumn, and there will be 15 Netto stores trading int he North West, Yorkshire and North East by the end of 2015. If they are a success the concept will be rolled out nationwide.
Netto disappeared from the UK when it sold its 193 stores to Asda in 2010 for £778m.
In a statement Sainsbury’s and Netto said: “The new-look Netto will take the form of a joint venture combining Dansk Supermarked’s (Netto’s parent company) excellence in systems, infrastructure and low-cost operations with Sainsbury’s UK grocery, product sourcing and property expertise, in a compelling customer proposition.”
Both are investing an initial £12.5m in the joint venture and expects to incur a post-tax loss in the region of £5-10m up to 31 March 2015.
Per Bank, CEO of Dansk Supermarked, said: “It’s great to be bringing a new twist to the rapidly-growing UK discount sector. We’ll offer market-leading value to customers with the freshness and innovation that customers rightly associate with Denmark.
“The discounter experience, operating model and systems of the Dansk Supermarked group, combined with Sainsbury’s UK market insight, property expertise and logistics excellence will help deliver a discounter format we think UK customers will love.”
The new Netto stores will feature a fresh food offer as well as an in-house bakery offering fresh Danish breads and delicious Danish pastries. There will also be weekly and seasonal “when it’s gone it’s gone” offers in both food and non-food ranges, bringing customers a “new world every week” at low prices.
Mike Coupe, chief executive designate of Sainsbury’s said: “”We are very excited about helping to bring the new Netto to British shoppers. This joint venture provides a great opportunity for us to gain exposure to the high growth discount market for the first time in partnership with Dansk Supermarked, whose expertise and values are a strong complement to our own.
“If successful, this trial has the potential to open up a new long term growth opportunity for us complementing our fast expanding convenience, online and non-food businesses, as well as our existing supermarket estate.”
Netto will be led by Morten Möberg Nielsen, previously managing director of Netto International in Germany.
