Sainsbury's strikes supply deal with Dobbies garden centres

Nick Gladding
Senior Retail Analyst

Date : 17 July 2020

Sainsbury's has agreed a deal to supply garden centre chain Dobbies with its own label products.

Leading garden centre to stock Sainsbury's own brands

The partnership is set to launch at the garden centre chain's flagship Edinburgh store later this month, according to press reports. The deal will make up to 3,000 Sainsbury's products available to Dobbies' customers, with the range spanning fresh, frozen and chilled lines as well as groceries, toiletries and household products. Dobbies is now the UK's largest garden centre operator with 68 stores nationwide, following its acquisition sites last year from the former market leader, Wyevale. In its latest filed accounts for the year to February 2019 (pre the latest acquisition of 31 sites from Wyevale), Dobbbies turned over £166m. It also achieved 6% LFL growth in the run-up to Christmas following the integration of these stores.

Volume opportunities for suppliers

For Sainsbury's the tie up with Dobbies, a business majority owned by Tesco from 2007 to 2016, represents a further stepping up of its wholesale interests that expands demand for its private label suppliers. In recent years, Sainsbury's has developed partnerships with WH Smith, SimplyFresh and Euro Garages (now terminated). Wholesale has also become a platform for Sainsbury's to expand beyond the UK; its products can now be bought at Coles supermarkets in Australia and it has also sold through the Alibaba owned Tmall marketplace in China. Dobbies has a high quality garden centre estate serving more affluent shoppers that could prove valuable for helping Sainsbury's to reach shoppers on leisure shopping missions where shoppers are not so price focused and in catchments less well served by other Sainsbury's stores.

Doubts over future of Dobbies Nisa deal

For Dobbies the move marks a major pivot in its food and grocery offer and casts doubt over an existing deal with Co-op owned Nisa. Nisa has provided a range of everyday groceries at 35 of Dobbies garden centres to supplement its foodie focused range since it launched its Foodhall strategy in March last year. However a Dobbies source is quoted as saying that the relationship will continue for the time being in stores that aren't trialling the Sainsbury's offer.

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