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Sainsbury’s to trial new supermarket format to help it combat the discounters

Sainsbury’s Chief Executive Mike Coupe has revealed that the retailer is planning to test a new format at six of its supermarkets as part of efforts to stand out from the discounters and fight back against falling sales.

In an interview with the Telegraph to mark his first anniversary since succeeding Justin King, Coupe said he was looking to “reinvent” the supermarket to counter the challenge from online, the discounters and convenience stores.

 Whilst Coupe did not reveal full details of the new format, he said they would include new self-scan technology that allows shoppers to pay via mobile devices and layout changes such as moving popular products like fresh foods to the front of the stores.

 Coupe told the newspaper: “Our challenge is to reinvent the superstore for the next generation, for the future. If you characterise last year as building a plan and making sure we had the financial capacity to execute the plan, this year for us is all about experimentation and starting to understand how we can make our larger stores in particular different for the future.

“My measure of long-term success would be how and when we change the dynamic of our superstore business. We are certainly looking to push the boundaries of what we might do with those formats in the future.”

Coupe added that people have got used to shopping in smaller formats and they wanted superstores to be more “convenient” and simpler places to shop to match the habits of the modern consumer.

 Sainsbury’s has struggled over the last year with sales falling and its market share slipping 20 basis points to 16.5% (Kantar Worldpanel). As with its main supermarket rivals, the chain has suffered amid intense competition from the discounters and a downturn in trade at its larger stores as shoppers shift their spending to local convenience outlets and online. However, the group is now implementing its turnaround strategy outlined last November which entails growing its ecommerce activities, investing in prices and food quality, simplifying promotions, and cutting costs to release funds to invest in growth areas.

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