Co-op continues assault on supermarket Big Four

THE boss of Co-operative Group has said its next assault on the Big Four supermarkets will be over food provenance, as it makes the most of its farming credentials.

Peter Marks, chief executive of the Co-operative Group, has said a key differentiator for the group, which could help it to win greater market share, is that it produces much of the food sold in its stores.

The Co-operative is the UK’s biggest farmer, according to Mr Marks, with more than 50,000 acres of farming land.

“In the future we will leverage the fact that we are in farms – it gives us a USP against our competitors,” he told an audience of business people at a Pro.Manchester event yesterday.

“Even Tesco can’t say ‘we grew the food that is on our shelves on our own land’. With food provenance becoming increasingly important, we think that’s an advantage.”
Co-op’s food stores contribute around 75% towards total group profits.

Bradford-born Mr Marks said that the company’s interim results, which showed first half profits rose 17% to £228.8m, prove the group was right to target consumers on ethics, rather than price, during the recession.

He added that the group’s huge investment in modernising its food stores – at a rate of 700 stores a year for the last three years – has also impacted performance significantly. The final 700 stores are being refurbished in 2010, he said.

But he admitted it was the group’s acquisition of Somerfield that has had the biggest and most immediate impact. “This deal was transformational,” he said.

“It took us from the second division to the Premiership in one fell swoop.”

The group plans to invest even more in its development, with the creation of brand new headquarters in Manchester city centre.

But Mr Marks said the £200m building would “pay for itself many times over”, by the time the company has released the land it currently occupies at sites across Manchester.

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