UK: five important store openings in Q1

Date : 25 March 2021

Rachel Sibson

Retail Analyst

Despite the COVID-19 pandemic, we have seen a high level of format innovation in the UK this quarter. In this article we highlight five key stores that have opened and the trends driving store innovation.

1. Sainsbury’s new flagship store

In February, Sainsbury’s relaunched its Hempstead Valley supermarket after eight months of redevelopment work to create a next generation state-of-the-art store.

Innovations in the new look store include the retailer’s first Fresh Food Market, an on-the-go snacking hub, and a new look café. Following the decision not to reopen meat, fish and deli counters post-pandemic, Sainsbury’s is adapting this space to prioritise ‘value-added-foods’. This is evident in the Hempstead Valley store through its popular pizza and hot food offer and a new self-serve patisserie counter. Non-food areas have also benefitted from investment, with the introduction of a new beauty department and clothing and home sections.

The new store aligns with the changes to shopping habits resulting from COVID-19. For example, the store simplifies the journey for many shopper missions from the full trolley shopper also buying the extensive home and fashion offer, to meal for tonight and top-up shoppers.


Source: Sainsbury's

For more detail and key takeaways, Retail Analysis subscribers can see inside Sainsbury’s new flagship store in our store report here.

2. Amazon Fresh

In March, Amazon opened its first physical store in the UK, under the Amazon Fresh banner. Amazon Fresh is the first convenience grocery store to offer Amazon’s Just Walk Out Technology outside the US. The 2,500 sq. ft store is in Ealing, London. The retailer has since launched its second store of the same format in Wembley, with plans to roll out the concept further in the Greater London area.

Amazon Fresh offers an easy-to-shop format with an impressive range of products catering to a range of convenience missions. From a shopper perspective, the automated checkout concept is likely to appeal, particularly to tech-savvy younger shoppers whose focus is on time saving. We expect to see more changes in checkout and payment points on a wider scale among conventional store operators in the medium term.


Source: IGD Research

Subscribers can view our store visit report for more detail on Amazon Fresh UK, including Amazon’s new private label range and key missions.

Subscribers can also see our report on automated stores here and the implication of these stores on industry.

3. Tesco’s new compact supermarket format

Tesco opened its first larger store in six years in January. The compact fresh-focus supermarket supports full weekly shops as well as customers on smaller meal-focused and top-up shopping missions. It is in Penwortham, Lancashire and is the first of several set to open in 2021. Thinking from this format, which brings together Tesco’s latest initiatives on how best to serve shopper priorities, will influence other Tesco stores, both large and small

We highlighted ‘Evolving sustainability’ as one of our five key shopper trends for 2021. In 2020 we saw shoppers focus more on local sourcing; this was linked to bigger changes such as EU Exit. We expect this to evolve through 2021 into more sustainable behaviour, as industry and government attention turns to climate change with the UK hosting COP26, the UN Climate Change Conference in November.

Tesco’s Penwortham store is a great example of this. A key feature of the store is that it pushes boundaries on sustainability and energy efficiency. It demonstrates Tesco’s drive to lead on environmental standards as it works towards being carbon neutral in 2035.

Subscribers can see inside Tesco’s new compact supermarket format for more detail here.

Our report on Tesco’s sustainability strategy helps suppliers and manufacturers understand how Tesco is trying to address specific sustainability challenges and what they can do to help. Subscribers can read this report here.

4. Iceland’s new convenience format

Iceland launched its first dedicated convenience store format, Swift. Positioned as ‘fast, fresh and local’, Swift promises to give Iceland a platform to expand into more neighbourhood locations and smaller retail units. The format offers a significantly enhanced range focused especially in the chilled, ambient and beers, wines, and spirits categories. This enables the store to service a wide range of missions typical to convenience formats such as top-up, evening meal and off licence.

The Swift format allows Iceland to target the opportunity of the increase in shopping locally as shoppers have become more home-based.  We also highlighted ‘Fulfilling bigger basket missions’ as one of our five UK convenience trends to watch out for this year. The breadth of range in the Swift format adds more opportunities to build bigger basket spend through enhanced cross-sell. For example, alcohol for the evening meal mission.


Source: Iceland

We explore Iceland’s new convenience concept with its innovative approach to integrating frozen categories within an effective, broad-based convenience range here (available to subscribers).

5. Co-op’s first franchise store at a service station

Co-op launched a store at Cornwall Services, marking its first franchise store at a service station. With this store, the retailer’s franchise estate reaches 15 stores. These stores include independent retailers, university campuses, Nisa partners, Co-op’s first franchise partnership with a catering business, Gather & Gather, Costcutter company owned stores, and this service station store.

The new store is 2,000 sq. ft in size and will run on 100% renewable electricity. It is designed to serve commuters and tourists passing through the area. The range includes an extensive food-to-go proposition with hot and cold sandwiches, snacks, chilled drinks, an in-store bakery and Co-op’s new Fairtrade coffee offer, Ever Ground.

With its franchise model, Co-op has demonstrated the flexibility of the model by offering different routes to market through a mix of partners. Expanding its physical presence is part of its ‘closer to where I am’ strategy.