Magazine article Marketing

The Lure of the Country

Magazine article Marketing

The Lure of the Country

Article excerpt

Tesco plans to develop its presence in rural communities may benefit local shops.

Strict competition regulations are forcing the UK's supermarket chains to find additional ways to expand their empires. Companies including Sainsbury's and Tesco - and, more recently, Waitrose - have been building networks of smaller, convenience-style shops.

Last week, it emerged that Tesco is planning to capitalise on the demise of rural retailers, such as village shops, pubs and petrol stations, by acquiring the sites of failed businesses to use for its Express shops.

A Tesco spokesman confirms that convenience shopping is a growing market for retailers. 'There is room for more Express stores,' he says. 'Our customers tell us convenience is important to them and they like being able to walk to their store.'

Anticipating that this strategy may not be universally popular, he also points out that Express stores create jobs within communities and insists that Tesco has a strong track record in developing sites in disadvantaged areas.

Meanwhile, Waitrose has announced plans to open 300 smaller stores over the next 10 years. The retailer acknowledges that this will have a significant impact on the convenience market, as well as dramatically increasing its presence across the UK. It estimates that 6.5m potential customers are currently unable to access its branches.

Local adaptation

Malcolm Pinkerton, senior analyst at retail research specialist Verdict, says that the big four supermarkets are finding it difficult to gain planning permission in areas where supermarkets already exist. This has prompted the trend for top-up shops and convenience stores.

'Naturally, there has been some backlash from the community against these brands,' says Pinkerton. 'However, supermarkets are attempting to combat this through features such as tweaked store-fronts to help them integrate into the community.' He suggests that Tesco is very good at adapting its brand format because it has innovative and flexible store designs, which puts it in a good position to take over non-food spaces, such as petrol stations.

Graeme Willis, senior rural policy campaigner for the Campaign to Protect Rural England, argues that Tesco's approach could be a positive one, but only if a village has lost its local shop. …

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