Morrisons finds Safeway to grow convenience offer

SUPERMARKET group Morrisons is to re-launch into the convenience market little more than a year after it sold off its M Local chain.

In addition, Morrisons is developing a range of hundreds of convenience products for wholesale to independent retailers, branded Safeway. The range will be available from early next year.

The moves are seen as a smarter way to re-establish its presence in the convenience sector.

David Potts, chief executive of Morrisons, said: “These are two capital light ways of growing in the convenience food market. By working with well-established partners and reviving the Safeway brand, we are making our products more accessible to more customers.”

It is to open 10 Morrisons Daily convenience stores in Rontec petrol stations. Four Morrisons Daily shops will open before Christmas and a further six in January. They will be up to 3,000 sq ft in size, and will sell branded and Morrisons own brand products.

It is already trialling a convenience offer with another forecourt operator, Motor Fuel Group.

Morrisons said the re-introduction of the Safeway brand will enable it “to leverage its sourcing and unique food maker skills to give independent retailers’ customers access to great quality products”.

Morrisons bought Safeway, which was a FTSE 100 company, for £3bn in 2004 after a year-long battle. The Safeway name was lost in a phased rebranding.

It was part of a period of huge growth for the major supermarkets which was characterised by the space race led by Tesco – where Mr Potts and Morrisons chairman Andy Higginson held senior roles.

However shoppers’ habits have since changed and the online and convenience markets have grown in importance in recent years.

Morrisons, which was late to embrace both changes, has recently launched a tie-up with Amazon to address its online offer. The unprofitable Morrisons Local stores were offloaded last year, and the new owner rebranded the short-lived chain as My Local, but Mr Potts said his company would return to the convenience sector with an improved product.