First look: Asda The Deal Depot, Patchway

Date : 05 December 2019

Asda has opened its first bulk-buy trial outlet adjacent to its Patchway, Bristol superstore.  Using the The Deal Depot banner, this new format represents a distinct concept from the core Asda operation, with separate branding and differentiated ranging.  We popped in on its first day of trading to get a feel for this new value proposition and to grab a couple of bargains!

Source: IGD Research

Look and feel of a mini warehouse club

Unsurprisingly, given Asda's common Walmart parentage with the US warehouse club Sam's Club, The Deal Depot owes much to that format in terms of its look and feel.  Or if you know Costco, The Deal Depot will feel instantly familiar, right down to the open, wooden fixture for its wine range and the shopfloor tasting stations.  The obvious differences are of course that The Deal Depot is, at c20,000 sq ft, a fraction of the size of a typical warehouse format and that The Deal Depot is open access and requires no paid membership subscription.  The corollary of the relatively small size is that the product range is missing some of the more space-hungry elements of warehouse club offer, that is non-food above all.

Source: IGD Research

Differentiated 'club' products

In line with the warehouse club model of value, The Deal Depot range comprises products in bigger than normal formats including big multi-packs, wholesale cases, catering packs and plus-size consumer lines (such as 750g Bonne Maman jam for example).  Overall this means that there are few if any like-for-like products versus the superstore next door.  Merchandised at scale on pallets and racking, the total inventory is limited (fewer than 500 lines?), but has breadth enough to cover core grocery and household lines as well as chilled, frozen and produce.  Focused on leading and premium brands (and little or no private label so far), The Deal Depot range also stays faithful to the warehouse club formula with regard to keeping quality close to the centre of its value equation.

Source: IGD Research


Consumer or B2B?

As an open access format it seems likely that The Deal Depot would be destined to be pitching primarily to an end-user customer base, and the attractive, bright fit-out obviously also leans in that direction.  However, offering products at value, in bulk, can clearly also attract business purchasers.  For example, products like disposable nappies sold in a 'giga' pack offers a convenient option for childcare professionals as well as parents.  But the limitation of purchase multiples to six per customer on many lines, also suggests The Deal Depot is seeking to avoid the excessive attentions of commercial customers.  Perhaps the ideal customer may be one (say an independent caterer) who shops for a mixed trolley of domestic needs plus a top-up on specific business requirements, making for an overall significant transaction size.

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