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The Co-op has announced the acquisition of Dimec, a healthcare technology start-up.  The acquisition aims to enable Co-op to compete effectively in the UK healthcare market, a natural fit with Co-op’s existing business areas in food, insurance and later life.

A technology-enabled healthcare platform

Dimec has developed a digital solution that enables patients and GPs to interact and manage their prescriptions. Its technology allows patients to pair with GP surgeries and pharmacies so that they can access their GP records and order prescriptions online.

Co-op aims to use the strength of The Co-op name and its large UK store estate to create a trusted digital pharmacy offer for Co-op members and customers. Chemist and Druggist reported that Co-op plans to launch the “Co-op healthcare platform” for repeat prescriptions in March 2019.  Its ambitious plans also include the capability to offer e-consultations and possibly click and collect prescriptions via 8,000 Co-op, Nisa and Costcutter stores.

First ‘disruptor’ acquisition by Co-op

Dimec has been acquired for an undisclosed sum by Co-op Ventures, the innovation unit established to develop challenger Co-op businesses and designed to disrupt markets in which the Co-op does not currently operate. It is the first acquisition by Ventures and demonstrates Co-op's intent to develop new and innovative customer solutions.

Tim Davies, Director of Co-op Ventures, said: “The acquisition of Dimec allows us to accelerate the development of our healthcare proposition, and provides the technology required to ensure customers can interact with their NHS GP more conveniently.

The clear focus for our Ventures team is to target markets where there are unmet customer needs and where our Co-op difference adds real value using innovative digital business models. We’ll do it with a brand that we know people trust. Our healthcare offer will be designed for convenience and to meet the increasingly complex health and wellbeing needs of people as they live longer.

“The acquisition of Dimec is a core element in delivering this ambition and we’ll be providing more detail early next year in terms of our wider customer offer.”

Co-op's healthcare history

The healthcare market is familiar territory for Co-op: until four years ago it owned an estate of 780 pharmacies across the UK. These were sold to Bestway for GBP620m in October 2014 and have been re-branded to Well pharmacies.

Director of Co-op Ventures, Tim Davies, is a pharmacist and former chief operating office at Well who oversaw the sale of the Co-op sites.  His vision for Co-op's new digital healthcare platform is a very different approach to pharmacy services compared with Co-op's previous bricks-and-mortar offering.  The ambitious plans for this new acquisition highlight Co-op's innovative thinking when it comes to bringing new and relevant services to today's local communities.

IGD Co-op Trade Briefing

22 November 2018, Manchester

Succeeding together. Join IGD and Co-op for a day of looking to the future and building supplier relationships.

Find out more »

The Co-op has announced strong interim results for the first half of the year.

Sales increased by 10% to £5 billion, whilst group profit increased by £12 million to £26 million.

18th consecutive quarter of LFL growth

Food Retail like-for-like sales saw an increase of 4.4%, the 18th consecutive quarter of like-for-like sales growth.

Total food sales were up 3%, now at £3.6 billion, thanks to strong sales growth driven by the World Cup.

Co-op's 'Pizza & Beer' deal was a large success, with over 180 pizzas sold for every minute of football played.

Acquisition of Nisa boosting sales

Successful sales can be attributed to the acquisition of Nisa as well as strong food sales.

The acquisition has also helped to boost wholesale sales, now at £269 million.

The Co-op now supplies food to over 7,700 stores, including stores within the remit of its new supply deal with Costcutter.

By the end of 2018 will supply 850 Co-op own-brand ranges to Nisa partners.

Partnership with Live Nation

The retailer has opened 45 new food stores this year, along with a number of festival pop-up shops in an exclusive partnership with Live Nation.

Over 200,000 people attended the four festivals where Co-op set up shop. The festivals provided an opportunity for Co-op to build engagement with some of its key target shopper groups, particularly younger shoppers.

Read our Co-op at Reading Festival store visit report here »

Forward outlook

The Co-op remains confident that it will continue to invest in its business areas and member offer to drive commercial success.

Steve Murrells, Chief Executive of the Co-op, said "We're moving forward at pace with our Stronger Co-op, Stronger Communities plan, which we set out at the beginning of the year. We know that in order to make a difference, we have to be commercially successful and our performance in the first half shows that we’re delivering on that ambition. Our investment in products, price and distribution channels has seen us grow revenue, profit and member value in the first six months".

Allan Leighton, Independent Non-Executive Chair of the Co-op, commented "We've got exciting plans to continue transforming our Co-op to make it even more competitive, relevant and innovative in both existing and new markets. We'll continue to grow our current businesses and through our Ventures team we'll move into new areas where we can deliver even more value for our members and their communities".

 

IGD Co-op Trade Briefing

22 November 2018, Manchester

Succeeding together. Join IGD and Co-op for a day of looking to the future and building supplier relationships.

Find out more »

IGD Convenience Retailing Summit 2018

26-27 September, London

Convenience continues to outpace big store formats. This year we have launched a two-day event to help you explore every opportunity, possibility and future trend to boost your business.

Find out more »

The Co-op has enjoyed its fastest rate of growth in nearly seven years, according to the latest grocery market share figures from Kantar Worldpanel. Sales increased by 7.8% for the 12 weeks to 12 August 2018, driven by consumers’ preference to shop locally during the good summer weather. 

Co-op market share increases

During the period, Co-op attracted an additional 263,000 new shoppers through its doors, with the average customer visiting 22 times in the 12 weeks. As a result, Co-op’s market share increased 0.3 percentage points to 6.6%.  

Heatwave boosts UK grocery sales

Kantar’s figures reveal that the UK grocery market was particularly driven by the recent heatwave.  In July alone, consumers spent an additional £67m on alcoholic drinks, non-alcoholic beers grew by 58% and soft drinks sales were up by 28%.

Branded products outperform the market

The data also shows that the growth of branded products outpaced those of own label for the first time since 2015. For the period, heavily branded categories – such as savoury snacks, ice cream and soft drinks – performed particularly well, helping branded growth of 3.9% overtake that of total own label. This compares to total grocery market growth of 3.5%.

Want to know more?

Our latest Kantar: GB market shares report outlines the results for the major retailers for the 12 weeks to August 2018.

 

 

IGD Co-op Trade Briefing


 

22 November 2018, Manchester

 

Succeeding together. Join IGD and Co-op for a day of looking to the future and building supplier relationships.


Find out more »

Presentations

17/10/2018
Kantar market shares are generated using Kantar Worldpanel’s till-roll scanning methodology and extrapolated using a sample of 30,000 households. Figures are calculated over a rolling 12 week period and include VAT.
11/10/2018
An essential summary of trading priorities, latest developments, and other key commercial insights for Co-op.
02/10/2018
Stay up-to-date with the latest UK market data, shopper trends and sector developments.
View all presentations

Key presentation

This in-depth guide to the United Kingdom explores the key trends in grocery retail and the growth strategies of the leading retailers in the country.

An essential summary of trading priorities, latest developments, and other key commercial insights for Co-op.

22 November 2018, Manchester
Succeeding together. Join IGD and Co-op for a day of looking to the future and building supplier relationships.

We've developed a single, universal methodology for calculating food and consumer goods retail data, supported by our programme of primary and secondary research. This makes Retail Analysis the most reliable and robust source available for data of this type. 

We've grouped all the latest European retail news, store visits, retailer profiles and downloadable presentations together in one place.