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Sainsbury's

Coordinates: 51°31′02″N 0°06′30″W / 51.51722°N 0.10833°W / 51.51722; -0.10833
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This article is about the supermarket business. For other uses of the Sainsbury name, see Sainsbury (disambiguation).

51°31′02″N 0°06′30″W / 51.51722°N 0.10833°W / 51.51722; -0.10833

J Sainsbury plc
Company typePublic
LSE: SBRY
IndustryRetailing
Founded1869
Holborn, London, United Kingdom
Headquarters33 Holborn, London, EC1N 2HT, United Kingdom
Number of locations
Increase 1,254 (1 October 2014)
Key people
David Tyler
(Chairman)
Mike Coupe
(Chief Executive Officer)
ProductsConvenience/forecourt store, hypermarket/supercenter/superstore, supermarket
RevenueIncrease£23.949 billion (2014)[1]
Increase £1,009 million (2014)[1]
Increase £798 million (2014)[1]
OwnerJudith Portrait (3.92%)
Lord Sainsbury (4.99%)
Sainsbury family (15%)
Qatar Investment (25.999%)
Number of employees
Increase 161,000 (2014)[1]
SubsidiariesSainsbury's Bank Plc
Sainsbury's Supermarkets Ltd.
Sainsbury's Convenience Stores Ltd.
WebsiteCorporate Website
Consumer Website

Sainsbury's is the third largest chain of supermarkets in the United Kingdom with a share of the UK supermarket sector of 16.4%.[2] Founded in 1869 by John James Sainsbury with a shop in Drury Lane, London, the company became the largest grocery retailer in 1922, pioneered self-service retailing in the UK, and had its heyday during the 1980s. In 1995, Tesco overtook Sainsbury's to become the market leader, and Asda became the second largest in 2003, demoting Sainsbury's to third place.[3] The holding company, J Sainsbury plc, is split into three divisions, Sainsbury's Supermarkets Ltd, Sainsbury's Convenience Stores Ltd (Sainsbury's Local), and Sainsbury's Bank. The group's head office is in the Sainsbury's Store Support Centre in Holborn Circus, City of London.[4] The group also has interests in property.

As of May 2011, the largest Sainsbury family shareholders are Lord Sainsbury of Turville with 4.99%, with Judith Portrait the trustee of various Sainsbury settlements and charitable trusts holding 3.92%. The largest overall shareholder is the sovereign wealth fund of Qatar, the Qatar Investment Authority, who hold 25.999% of the company.[5] It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

History

Origin and growth (1869–1955)

Sainsbury's first store in Drury Lane c. 1919

Sainsbury's was established as a partnership in 1869 when John James Sainsbury and his wife Mary Ann opened a store at 173 Drury Lane in Holborn, London.[6] He started as a retailer of fresh foods and later expanded into packaged groceries such as tea and sugar. His trading philosophy, as stated on a sign outside his first shop in Islington, was "Quality perfect, prices lower".[7]

It was very innovative in that its stores, instead of featuring five own-brand lines like arch-rival Home and Colonial, it offered a wide range of own label lines in comparison. Instead of sawdust floors and wooden counters, Sainsbury's boasted marble counters, mosaic floors and white-tiled walls. Staff even had a uniform of white aprons. Stores started to look similar, so people could recognise them throughout London, a high cast-iron 'J. SAINSBURY' sign featured on every store so their stores could be seen on coaches and omnibuses,[8] and round-the-back deliveries started to add extra convenience and not upset rivals due to Sainsbury's popularity.[9]

In 1922 J Sainsbury was incorporated as a private company, as 'J. Sainsbury Limited', when it became the UK's largest grocery group.[10]

By this time each store had six departments: dairy, bacon and hams, poultry and game, cooked meats and fresh meats. Groceries had not been introduced until 1903 when John James purchased a grocer's branch at 12 Kingsland High Street, Dalston. Home delivery featured in every store as there were fewer cars in those days. Sites were carefully chosen, with a central position in a parade selected in preference to a corner shop. This allowed a larger display of products, which could be kept cooler in summer, which was important as there was no refrigeration.[11]

By the time John James Sainsbury died in 1928, there were 128 shops. His last words were said to be 'Keep the shops well lit'. He was replaced by his eldest son, John Benjamin Sainsbury, who had gone into partnership with his father in 1915.[12]

During the 1930s and 1940s, with the company now run by John James Sainsbury's eldest son, John Benjamin Sainsbury, the company continued to refine its product offer and maintain its leadership in terms of store design, convenience and cleanliness.[13] The company acquired the Midlands-based Thoroughgood chain in 1936.[14]

Alan Sainsbury, the founder's grandson (later Lord Sainsbury of Drury Lane) became joint managing director of Sainsbury's along with his brother Sir Robert Sainsbury in 1938 after their father, John Benjamin Sainsbury, had a minor heart attack.[15]

Following the outbreak of World War II, many of the men that worked for Sainsbury's were called to do National Service and were replaced by women. Given Sainsbury's reputation for quality foods at fair prices, the Second World War were difficult times for Sainsbury's, as most of its stores were trading in the London area and were bombed or damaged. Turnover fell to half the pre-war level. Food was rationed, and one particular store in East Grinstead was so badly damaged on Friday 9 July 1943 that it had to move to the local Church as a temporary replacement while a new one was built. This store was not completed until 1951.[16]

Self-service and heyday (1956–1991)

In 1956, Alan Sainsbury became chairman after his father, John Benjamin Sainsbury's death.[15] During the 1950s and 1960s Sainsbury's pioneered self-service supermarkets in the UK. On a trip to the United States of America, Alan Sainsbury realised the benefits of self-service stores, and believed the future of Sainsbury's was self-service supermarkets of 10,000 sq ft (930 m2), with eventually the added bonus of a car park for extra convenience.[17] The first self-service branch opened in Croydon in 1950.[18]

Sainsbury's was a pioneer in the development of own-brand goods; the aim was to offer products that matched the quality of nationally branded goods, but at a lower price.[19] It expanded more cautiously than Tesco, shunning acquisitions, and it never offered trading stamps.[20]

Until the company went public on 12 July 1973, as J Sainsbury plc, the company was wholly owned by the Sainsbury family. It was at the time the largest ever flotation on the London Stock Exchange;[21] the company rewarded the smaller bids for shares in order to create as many shareholders as possible. A million shares were set aside for staff, which led to many staff members buying shares that shot up in value. Within one minute the list of applications was closed: £495 million had been offered for £14.5 million available shares. The Sainsbury family at the time retained 85% of the firm's shares. The feverish press that surrounded the flotation greatly enhanced the company's new dynamic image.

Sainsbury's in Bradford on Avon, Wiltshire

The company benefited, too, from a consistency of management stemming from family ownership and control. The fact that it did not go public until 1973 was not a disadvantage; unlike Tesco, Sainsbury's grew organically rather than by takeovers, and, at least during this period, did not need to use its shares as an acquisition currency. Sainsbury's had the advantage, shared to some extent by Tesco, of a strong market position in London and the South East.

Most of the senior positions were held by family members; John Davan Sainsbury (later Lord Sainsbury of Preston Candover),[22] a member of the fourth generation of the founding family, took over the chairmanship from his uncle Sir Robert Sainsbury in 1969, who had been chairman for two years from 1967 following Alan Sainsbury's retirement.

Sainsbury's started to replace its 10,000 sq ft (930 m2) High Street stores with self-service supermarkets above 20,000 sq ft (1,900 m2), which were either in out-of-town locations or in regenerated town centres. Sainsbury's policy was to invest in uniform, well-designed stores with a strong emphasis on quality; its slogan was "good food costs less at Sainsbury's".[23] During the 1970s the average size of Sainsbury's stores rose from 10,000 sq ft (930 m2) to around 18,000 sq ft (1,700 m2); the first edge-of-town store, with 24,000 sq ft (2,200 m2) of selling space, was opened at Coldhams Lane in Cambridge in 1974. The last counter service branch closed in Peckham in 1982.[24]

Although these larger stores contained some non-food items, they were not intended to match what Asda had been doing in the north; Sainsbury's focused more single-mindedly on food.

To participate in the hypermarket sector, Sainsbury's formed a joint venture, known as SavaCentre, with British Home Stores. The first SavaCentre store was opened in Washington, Tyne and Wear, in 1977;[25] nearly half the space, amounting to some 35,000 sq ft (3,300 m2), was devoted to textiles, electrical goods and hardware. As the hypermarket format became more mainstream, with rivals such as Asda and Tesco launching ever-larger stores, it was decided that a separate brand was no longer needed and the stores were converted to the regular Sainsbury's superstore format in 1999.[26] This is in direct contrast to rival firms Tesco and Asda, which have been rapidly expanding their Tesco Extra and Asda Wal-Mart Supercentre hypermarket formats in recent years.

Another diversification took place in 1979, when Sainsbury's formed a joint venture with the Belgian retailer, GB-Inno-BM, to set up a chain of do-it-yourself stores under the Homebase name.[27] The plan was to open a DIY store with a supermarket-style layout. Homebase was tripled in size in 1995 with the acquisition of the rival Texas Homecare from the Ladbroke Group plc. Sainsbury's sold the Homebase chain in December 2000 in a twofold deal worth £969 million. Sales of the chain of stores to venture capitalist Schroder Ventures generated £750 million and sale of 28 development sites, which had been earmarked for future Homebase stores, were sold for £219 million to rival B&Q's parent company, Kingfisher plc.[28]

The company's growth was still largely based on food, with only a modest contribution from the SavaCentre business (of which Sainsbury's took full control in 1989). There was, however, diversification outside the UK.

In November 1983 Sainsbury's purchased 21% of Shaw's Supermarkets, the second largest grocery group in the northeastern United States (primarily in New England). In June 1987, Sainsbury's acquired the rest of the company with the intention of creating a high-quality regional food retailing business based on the same principles as the UK-based operation.[29]

In 1985 the chairman reported that over the preceding ten years profits had grown from £15 million to over £168 million, a compound annual rise of 30.4% – after allowing for inflation a real annual growth rate of 17.6%.[29]

During the 1980s the Company invested in new technology: the proportion of sales passing through EPOS scanning checkouts rose from 1% to 90%.[29]

With the advent of out of town shopping complexes during the 1980s, Sainsbury's was one of the many big retail names to open new stores in such complexes – notably with its store at the Meadowhall Shopping Centre, Sheffield (originally as a SavaCentre) in 1990, which was converted into a regular Sainsbury store in 2005, and was closed in 2006 and the Merry Hill Shopping Centre at Brierley Hill in the West Midlands (part of an Enterprise Zone), which opened in September 1989 to replace a store in Dudley town centre. The success of the Merry Hill store, combined with the onset of the recession resulted in a fall in trade at the nearby store in Halesowen, which closed in 1992.

Sainsbury's expanded its operation into Scotland with a store in Darnley opening in January 1992, (the SavaCentre at Cameron Toll in Edinburgh had opened in 1984). In June 1995 Sainsbury's announced its intention to move into the Northern Ireland market, until that point dominated by local companies.[30] Between December 1996 and December 1998 the company opened seven stores. Two others at Sprucefield, Lisburn and Holywood Exchange, Belfast would not open until 2003 due to protracted legal challenges. Sainsbury's move into Northern Ireland was undertaken in a very different way from that of Tesco. While Sainsbury's outlets were all new developments, Tesco (apart from one Tesco Metro) instead purchased existing chains from Associated British Foods (see Tesco Ireland).

In 1991, the group boasted a 12-year record of dividend increases of 20% or more and earnings per share had risen by as much for nearly as long.[31] Also in 1991 the company raised £489 million in new equity to fund the expansion of superstores.[31]

Sainsbury's decline (1992–1998)

The Sainsbury's supermarket building in Greenwich, which was nominated for the Stirling Prize in 2000.

In 1992 the long-time CEO John Davan Sainsbury retired and was succeeded as chairman and chief executive by his cousin, David Sainsbury (later Lord Sainsbury of Turville); this brought about a change in management style – David was more consensual and less hierarchical but not in strategy or in corporate beliefs about the company's place in the market.[31] Mistakes by David Sainsbury and his successors, Dino Adriano and Peter Davis, included the rejection of loyalty cards, the reluctance to move into non-food retailing, the indecision between whether to go quality or for value, "the sometimes brutal treatment of suppliers" which led to suppliers favouring Tesco over Sainsbury's and the unsuccessful John Cleese advertising campaign.[32]

At the end of 1993 it announced price cuts on 300 of its most popular own-label lines. Significantly, this came three months after Tesco had launched its Tesco Value line.[31] A few months later Sainsbury's announced that margins had fallen, that the pace of new superstore construction would slow down, and that it would write down the value of some of its properties.[31]

In 1994 Sainsbury's announced a new town-centre format, Sainsbury's Central, again a response to Tesco's Metro, which was already established in five locations.[31] Also in 1994 Sainsbury's lost the takeover battle for William Low (like Tesco, Sainsbury's had long been under-represented in Scotland).[33] Also that year David Sainsbury dismissed Tesco's clubcard initiative as 'an electronic version of Green Shield Stamps'; the company was soon forced to backtrack, introducing its own Reward Card 18 months later.[34]

For much of the 20th century Sainsbury's had been the market leader in the UK supermarket sector, but in 1996 it lost its place as the UK's largest grocer to Tesco.[35]

Some new ventures were successful, notably the launch of a retail bank, Sainsbury's Bank, in partnership with Bank of Scotland.[36]

In addition to Shaw's, Sainsbury's bought a minority stake in another supermarket group, Giant Food, based in Washington DC,[37] although this shareholding was subsequently sold when Ahold of the Netherlands made a full bid for the company.

Sainsbury's also trebled the size of its Homebase do-it-yourself business in 1996 by merging its business with Texas Homecare, which it acquired from Ladbroke for £290 million.[38]

In addition to expansion of larger formats and banking services, Sainsbury's decided to provide shopping services to small towns, which led to the construction of "Country Town" stores. These were small supermarkets which enabled large villages to get their weekly shopping without travelling to large out of town stores. These "Country Town" stores were opened mainly across the south east which is historically Sainsbury's strongest market. Potential sites were identified and finally stores were opened in Attleborough and Chipping Ongar (Essex) towards the end of 1998. The "Country Town" format may now be discontinued but the stores which were completed have now been brought up to standard with the rest of the company's portfolio and continue to trade strongly even with many having larger stores within 10 minutes travel from the "Country Town" stores.

In 1996 the company reported its first fall in profits for 22 years. David Sainsbury announced management changes, involving the appointment of two chief executives, one in charge of UK supermarkets (Dino Adriano) and the other responsible for Homebase and the US (David Bremner).[39]

Finally, in 1998, David Sainsbury himself resigned from the company to pursue a career in politics.[40] He was succeeded as non-executive chairman by George Bull, who had been chairman of Diageo,[41] and Adriano was promoted to be Group Chief Executive.[42]

The brand re-launch (1998–2003)

Sainsbury's logo, launched in 1998

In June 1998 Sainsbury's unveiled its new corporate identity, which was developed by M&C Saatchi, which consisted of the current company logo, new corporate colours of "living orange" and blue, Interstate as the company's new general use lowercase font from the old all uppercase font, the new slogan "Making life taste better", which replaced its old slogan from the 1960s and new staff uniforms.[43][44] The strapline was dropped in May 2005 and replaced in September of that year by "Try something new today." This new brand statement was created by Abbott Mead Vickers BBDO. While the Interstate font was used almost exclusively for many years, the company introduced another informal font in 2005 which is used in a wide range of advertising and literature. Since 2013 it is now "Live well for less"; the design has varied on the receipts.

In 1999 Sainsbury's acquired an 80.1% share of Egyptian Distribution Group SAE, a retailer in Egypt with 100 stores and 2,000 employees. However poor profitability led to the sale of this share in 2001.[45] On 8 October 1999 the CEO Dino Adriano lost control of the core UK supermarket business, instead assuming responsibility for the rest of the group. David Bremner became head of the UK supermarkets. This was "derided" by the city[46] and described as a "fudge".[47] On 14 January 2000 Sainsbury's reversed this decision by announcing the replacement of Adriano by Sir Peter Davis effective from March.[47]

Between 2000–2004, Sir Peter Davis was chief executive of Sainsbury's. Davis' appointment was well received by investors and analysts.[48] The appointment was only confirmed after Sainsbury's was sure of the support of the Sainsbury family, who snubbed Davis' offer of becoming chief executive in the early 1990s, following which he became Chief Executive of Prudential plc.

In his first two years he exceeded profit targets, although by 2004 the group had suffered a decline in performance relative to its competitors and was demoted to third in the UK grocery market. Davis also oversaw an almost £3 billion upgrade of stores, distribution and IT equipment, entitled 'Business Transformation Programme', but his successor would later reveal that much of this investment was wasted and he failed in his key goal – improving availability. Part of this investment saw the construction of four fully automated depots, which at £100 million each cost four times more than standard depots.[49]

In 2001, Sainsbury's moved into its current headquarters at Holborn, London. Sainsbury's previously occupied Stamford House and 12 other buildings around Southwark. However the accounting department remained separate at Streatham. The building was designed by architectural firm Foster and Partners and had been developed on the former Mirror Group site for Andersen Consulting (now Accenture), however Sainsbury's acquired the 25-year lease when Accenture pulled out.[50] Sainsbury's is a founding member of the Nectar loyalty card scheme, which was launched in late 2002 in conjunction with Debenhams, Barclaycard and BP.Since then both Debenhams and Barclaycard have left the scheme. The Nectar scheme replaced the Sainsbury's Reward Card; accrued points were transferred over.[51]

In 2003 Wm Morrison Supermarkets (trading as Morrisons) made an offer for the Safeway group, prompting a bidding war between the major supermarkets. The Trade and Industry Secretary, Patricia Hewitt, referred the various bids to the Competition Commission which reported its findings on 26 September. The Commission found that all bids, with the exception of Morrison's, would "operate against the public interest". As part of the approval Morrison's was to dispose of 53 of the combined group's stores. In May 2004 Sainsbury's announced that it would acquire 14 of these stores (13 Safeway stores and 1 Morrison's outlet) located primarily in the Midlands and the North of England.[52]

'Making Sainsbury's Great Again' (2004–2006)

J Sainsbury HQ in Holborn photographed in 2005, the surrounding area has since changed dramatically.

At the end of March 2004 Davis was promoted to chairman and was replaced as CEO by Justin King. King joined Sainsbury's in from Marks and Spencer plc where he was a director with responsibility for its food division and Kings Super Markets, Inc. subsidiary in the United States.[53] Schooled in Solihull and a graduate of the University of Bath, where he took a business administration degree, King was also previously a managing director at Asda with responsibility for hypermarkets.[53] In June 2004 Davis was forced to quit in the face of an impending shareholder revolt over his salary and bonuses. Investors were angered by a bonus share award of over £2 million despite poor company performance. On 19 July 2004 Davis' replacement, Philip Hampton, was appointed as chairman.[54]

King ordered a direct mail campaign to 1 million Sainsbury's customers as part of his 6-month business review asking them what they wanted from the company and where the company could improve. This reaffirmed the commentary of retail analysts – the group was not ensuring that shelves are fully stocked, this due to the failure of the IT systems introduced by Peter Davis. On 19 October 2004 King unveiled the results of the business review and his plans to revive the company's fortunes – in a three-year recovery plan entitled 'Making Sainsbury's Great Again'.[55] This was generally well received by both the stock market and the media. Immediate plans included laying off 750 headquarters staff and the recruitment of around 3,000 shop-floor staff to improve the quality of service and the firm's main problem: stock availability. The aim would be to increase sales revenue by £2.5 billion by the financial year ending March 2008. Another significant announcement was the halving of the dividend to increase funds available for price cuts and quality.[55]

King hired Lawrence Christensen as supply chain director in 2004. Previously he was an expert in logistics at Safeway, but left following its takeover by Morrisons. Immediate supply chain improvements included the reactivation of two distribution centres. In 2006 Christensen commented on the four automated depots introduced by Davis, saying "not a single day went by without one, if not all of them, breaking down... The systems were flawed. They have to stop for four hours every day for maintenance. But because they were constantly breaking down you would be playing catch up. It was a vicious circle."[49] Christensen said a fundamental mistake was to build four such depots at once, rather than building one which could be thoroughly tested before progressing with the others.[56] At the time of the business review on 19 October 2004, referring to the availability problems, Justin King said "Lawrence hadn't seen anything that he hadn't seen before. He just hadn't seen them all in the same place at the same time". In 2007 Sainsbury's announced a further £12 million investment in its depots to keep pace with sales growth and the removal of the failed automated systems from its depots.[57] In addition, it did a deal with IBM to upgrade its Electronic – Point of Sale systems as a result of increased sales.

Sainsbury's sold its American subsidiary, Shaw's, to Albertsons in 2004.[58] Also in 2004 Sainsbury's expanded its share of the convenience store market through acquisitions. Bell's Stores, a 54 store chain based in north-east England was acquired in February 2004.[59] Jackson's Stores, a chain of 114 stores based in Yorkshire and the North Midlands, was purchased in August 2004.[60] JB Beaumont, a chain of 6 stores in the East Midlands was acquired in November 2004.[61] SL Shaw Ltd, which owned six stores was acquired on 28 April 2005 for £6 million.[62]

Since the launch of King's recovery programme, the company has reported nineteen consecutive quarters of sales growth, most recently in October 2009.[63] Early sales increases were credited to solving problems with the company's distribution system.[64] More recent sales improvements have been put down to price cuts and the company's focus on fresh and healthy food.[65]

Takeover bids (2007)

On 2 February 2007, after months of speculation about a private equity bid, CVC Capital Partners, Kohlberg Kravis Roberts (KKR) and Blackstone Group announced that they were considering a bid for Sainsbury's.[66] The consortium grew to include Goldman Sachs and Texas Pacific Group. On 6 March 2007, with a formal bid yet to be tabled, the Takeover Panel issued a bid deadline of 13 April.[67]

On 4 April KKR left the consortium to focus on its bid for Alliance Boots.[68] On 5 April the consortium submitted an "indicative offer" of 562p a share to the company's board. After discussions between Sir Philip Hampton and the two largest Sainsbury family shareholders Lord Sainsbury of Turville and Lord Sainsbury of Preston Candover the offer was rejected.[68] On 9 April the indicative offer was raised to 582p a share, however this too was rejected. This meant the consortium could not satisfy its own preconditions for a bid, most importantly 75% shareholder support; the combined Sainsbury family holding at the time was 18%.[69]

Lord Sainsbury of Turville, who then held 7.75% of Sainsbury's, stated that he could see no reason why the Sainsbury's board would even consider opening its books for due diligence for anything less than 600p per share.[70] Lord Sainsbury of Preston Candover, with just under 3%, was more extreme than his cousin, and refused to sell at any price.[71] He believed any offer at that stage of Sainsbury's recovery was likely to undervalue the business,[70] and with private equity seeking high returns on their investments, saw no reason to sell, given that the current management, led by Justin King, could deliver the extra profit generated for the benefit of existing investors.[72] He claimed the bid 'brought nothing to the business', and that high levels of debt would significantly weaken the company and its competitive position in the long-term, which would have an adverse effect on Sainsbury's stakeholders.[73]

On 11 April the CVC-led consortium abandoned its offer, stating "it became clear the consortium would be unable to make a proposal that would result in a successful offer."[69]

In May 2007 Sainsbury's identified five areas of growth: Growth of non-food ranges; opening of new convenience stores and growth of online home delivery and banking operations; Expansion of supermarket space through new stores and development of the company's "largely underdeveloped store portfolio"; and "active property management".[74]

On 25 April 2007 Delta Two, a Qatari investment company, bought a 14% stake in Sainsbury's causing its share price to rise 7.17%, which was then upped to 17.6%. Their interest in Sainsbury's is thought to centre on its property portfolio. They increased their stake to 25% in June 2007.[75]

On 18 July 2007 BBC News reported that Delta Two had tabled a conditional bid proposal.[76]

Paul Taylor, the principal of Delta Two, flew David and John Sainsbury to Sardinia to reveal and discuss the potential bid which amounted to 600p per share.[77]

The family had reservations about the price of the bid. Secondly, they were concerned about the proposed structure which involved splitting the business into an operating company and a highly leveraged property company. Thirdly, they were concerned about adequacy of funding both for the bid and for the company's pension scheme.[78]

On 5 November 2007 it was announced Delta Two had abandoned its takeover bid due to the "deterioration of credit markets" and concerns about funding the company's pension scheme.[79]

Recent developments (2007–present)

Sainsbury's in the former Allders branch on The Headrow in Leeds city centre

On 4 October 2007 Sainsbury's announced plans to relocate its Store Support Centre from Holborn to Kings Cross in 2011. The new office will be part of a new complex to allow for both cost savings and energy efficiency. These savings will be made through the use of efficient building materials and design, a combined heat and power energy centre and the use of renewable energy sources.[80]

In January 2008 Sainsbury's brought its number of Northern Ireland supermarkets to 11 with the purchase of two Curley's Supermarkets in Dungannon and Belfast, which includes those stores' petrol stations and off licences.[81][82][83]

In March 2009 Sainsbury's announced it was buying 24 stores from The Co-operative, 22 of which were Somerfield stores and the remaining 2 were Co-op stores: these are part of their estate which The Co-operative were required to sell following the completion of the Somerfield takeover.[84] A further 9 stores were purchased from The Co-operative in June 2009. These were concentrated in west Wales, the north of England and Scotland where Sainsbury's market share is low.[85]

In November 2007, Sainsburys centralised its HR department, relocating to the 17th and 18th floors of Manchester's Arndale Centre to form a Shared Service Centre which was initially trialled to deal with Recruitment in Scotland and was later rolled out to the whole country. July 2009 saw the HR Shared Service Centre in Manchester expand to include most HR Processes in its Colleague Administration Department and Occupational Health enquiries in a dedicated unit. Since April 2012, the centre has began a gradual relocation to its new offices in the centre of Lincoln, along with a rebrand and partial relaunch as Sainsburys HR Services.[86]

In May 2010 Justin King announced that Sainsbury's pledged to involve each of its 850 stores in the promotion of the Paralympics after the multimillion-pound deal with Locog to be the main sponsor of the London 2012 Paralympic games. The sum was not disclosed. Sainsbury’s will sell Paralympic merchandise and become involved in high-profile events such as the torch relay. It will be one of only two sponsors able to take advantage of the limited branding allowed within the Games. The promotional rights do not extend to the Olympics. After the Paralympic Games the company decided to sponsor the British Paralympic Association through to Rio 2016.[87]

In September 2011 it was announced that the "Try Something New Today" slogan would be replaced with "Live Well For Less", this decision was made after an 18 month business review. The slogan will be phased in, and will be prominent on till receipts from 16 September.[88]

On 30 November 2011 Sainsbury's reached the first milestone in its 2020 vision by opening its 1000th store in Irvine, Scotland. To celebrate this, Sainsbury's doubled its staff discount to 20% for the first 4 days of December.[89]

Further re-organisation has seen Central Finance Operations move from the Holborn Head Office to Manchester and Property Division move to Ansty Park in Coventry. Most of the remaining Holborn operations are likely to move to Coventry in due course, as Sainsbury's looks to reduce costs by moving out of Central London.[90] The group is also investing in alternative energy methods. In July 2014 it began powering one of its stores by converting food waste into bio-methane gas to generate electricity. The group became the first retailer to come off the National Grid by its own means.[91]

Leaders

Year Managing Directors
1896–1928 John James Sainsbury
1928–1938 John Benjamin Sainsbury
1938–1956 Alan Sainsbury, (later Lord Sainsbury of Drury Lane) and
Robert Sainsbury, (later Sir Robert Sainsbury)
(Joint managing directors)
1956–1969 Robert Sainsbury, (later Sir Robert Sainsbury)

Financial performance

Between 1990 and 2010, Sainsbury's turnover increased from £6.9 billion to £21.4 billion, with a small dip in 2005, a year in which parts of the business were restructured. Profits before and after tax have been turbulent, with most years showing a pre-tax profit of £500–700 million and a profit for the year between £300–500 million, with 2005 and 2006 showing much reduced figures. 2005 saw exceptional costs of £100 million, and in 2006 Sainsbury's incurred "one-off operating costs" of £152 million, including £63 million to terminate the IT outsourcing contract with Accenture. Earnings per share in years other than 1994, 2005 and 2006 fell in the range 14p–33p. News reports on Wednesday 14 November 2012 reported that Sainsburys had performed well financially that year, reaching 6% profits at the start of the year 2012. Part of the success was due to the supermarket manufacturing its own-brand labels.

Current operations

Sainsbury's currently operates supermarkets and convenience stores. It also operates Sainsbury's Bank, Mobile by Sainsbury's phone network, Sainsbury's fuel forecourts and Sainsbury's Online internet shopping services; and has a property portfolio worth £8.6 billion (as of March 2007). It is the second largest supermarket chain in the UK (since 2014), and says it places an emphasis on a higher quality grocery offering compared to its other large rivals.

Areas of business for Sainsbury's include the following:

  • Sainsbury's Local, convenience stores
  • Sainsbury's Supermarkets, standard supermarkets
    • Sainsbury's Petrol, fuel forecourts at many Sainsbury's stores
  • Sainsbury's Online, as sainsburys.co.uk, an online groceries, clothing and merchandise website
    • Sainsbury's Entertainment, an online retailer of DVDs, books etc., and digital retailer of eBooks and video on demand
    • Sainsbury's Gift Cards and Sainsbury's Business Direct, online retailers of gift cards
    • Sainsbury's Compare and Save, a utilities comparison site operated with Simplifydigital
  • Sainsbury's Bank, a financial services group now operated by Sainsbury's (and previously Lloyds Bank)
  • Sainsbury's Pharmacies, pharmacies located in stores and in hospitals
  • Sainsbury's Energy, a utilities provider operated with British Gas
  • Mobile by Sainsbury's, a virtual mobile phone network operated with Vodafone

According to CACI, as of 2006, Sainsbury's has market dominance in 8 postcode areas; TQ (Torquay), SN (Swindon), GU (Guildford), RH (Redhill), DA (Dartford), SE (South East London), EN (Enfield) and WV (Wolverhampton).[92]

It is particularly strong in London and the South-East, where it is based, and has powerful positions within many UK cities. For example in Southampton there are five Sainsbury's supermarkets (one is a Flagship store) and two Sainsbury's Local stores.

Stores

Sainsbury's checkouts, showing the 'Greenwich Blue' colour scheme

There are two main store formats; regular Sainsbury's supermarkets and Sainsbury's Local convenience stores. The chain previously used two other identities for its stores; Sainsbury's Central for smaller supermarkets and SavaCentre and later Sainsbury's SavaCentre for its hypermarkets. Both identities were phased out in 2005.

At the end of its 2011/12 financial year Sainsbury's store portfolio was as follows.[93]

Format Number Total Space (sq ft)
Supermarkets 583 20,056,000
Convenience stores 523 1,029,000
Total 1106 21,265,000

Traditionally, the majority of Sainsbury's stores were located in London and south-east England. The company acquired the Midlands-based Thoroughgood in the 1930s. Expansion since 1945 has given the company national reach, although the chain is not as well-represented in Scotland as Tesco, and Morrisons (as Safeway dominated Scotland before being taken over by them). This is partly due to Sainsbury's having lost out to Tesco in the bidding war for William Low in the 1990s.

Supermarkets

Interior of Sainsbury's Gloucester Quays store

Sainsbury's operates supermarkets that vary in size from under 10,000 sq ft (930 m2) up to over 100,000 sq ft (9,300 m2). The 'supermarket' group was previously split into three groups, 'Central', supermarkets and SavaCentre hypermarkets, however since 2005 and 2004 respectively the 'Central' and SavaCentre formats have been converted into the standard supermarket format.

On 29 September 2010, Sainsbury's opened one of its largest UK stores, an extension of its existing store in Crayford, Kent, which now has over 100,000 sq ft (9,300 m2) of retail space and is its largest supermarket to be built in the UK. Bybrook in Ashford Kent, which opened on 16 November 2011 has over 100,000 sq ft (9,300 m2).[94] In the same week it also opened its biggest store in Scotland at Darnley (90,000 sq ft (8,400 m2)) and its biggest in Wales at Newport (76,000 sq ft (7,100 m2)).

The refurbished Lincoln, Lincolnshire store opened on 24 November 2010 making it the UK's second largest Sainsbury's supermarket after Crayford at 98,712 sq ft (9,170.6 m2).[95]

The most northern Sainsbury's store is a 25,000 sq ft (2,300 m2) supermarket in Nairn, which opened in August 2011. Helston, which opened in 2010, is the company's most south-westerly store. Another, in Heaton Park, opened in March 2012, marking the departure of the retail park that was there.

Stores in the 'supermarket' category all have similar layouts and operations but may vary in their offering to the customer. Most will have a convenience kiosk, produce, meat, fish, groceries and frozen food, and manned and self-service checkouts. However depending on the size of the store they may also have an instore bakery, butcher, fishmonger, delicatessen and pizza counters, a cafe, TU clothing, general merchandise, mobile phone shop, petrol station and online picking department.

Sainsbury's Fuel

Sainsbury's operates a chain of fuel forecourts located at its supermarkets selling diesel, petrol and CityPetrol. The chain first opened a forecourt in 1974 at its Croydon SavaCentre hypermarket, the forecourts were initially supplied by and marketed as Jet stations.[96] However from 1980 onwards Sainsbury's operated its own forecourts and sourced its own fuel. In 2004 BP became the supplier of fuel and operated its forecourts at supermarkets where possible. However this deal ended in 2009 and once again operation of all forecourts and fuel sourcing returned to the control of Sainsbury's.[97]

Sainsbury's Café

Sainsbury's operate cafes, marketed as Sainsbury's Cafè, in many of its supermarkets which are open for almost as long as the stores are open.[98] These restaurants were first seen in Savacentre hypermarkets and were later introduced into supermarkets after their continued success. The cafes were previously known as J Sainsbury Restaurants.

Convenience stores

Main article: Sainsbury's Local
Sainsbury's Local in Winton, Bournemouth

Sainsbury's operates Sainsbury's Local convenience stores, most of which are under 10,000 sq ft (930 m2) although two are larger.

As well as developing its own sites, Sainsbury's expanded its convenience protfolio through acquisitions of Bell's Stores, Jackson's Stores, JB Beaumont and SL Shaw Ltd. Sainsbury's initially retained the strong Bells, Jacksons and Beaumont branding. For example, refurbished stores were called Sainsbury's at Bells. These were effectively Sainsbury's Local stores with a revised fascia, retaining some features of the former local chain. Unrefurbished stores retained the original brand and logo, but still offered Sainsbury's own brand products, pricing and some point of sale, without accepting Nectar cards. The old websites were also retained with some Sainsbury's branding. However all of these acquired stores were fully converted to the Local fascia from 4 May 2007.[99]

The most northern Sainsbury's Local is the Rosemount Place store in Aberdeen, which opened on 17 December 2010.

In July 2013, chief executive Justin King announced plans to focus on expanding its convenience stores to surpass the number of its supermarket properties by 2014.[100]

Sainsbury's Pharmacy

Sainsbury's operates 270 pharmacies within its supermarkets, 37 of these house an NHS GP or 'nurse-led' clinic and 12 house private dental surgeries.[101][102] Sainsbury's is also an emerging provider of outpatient hospital pharmacy services, operating pharmacies at three major UK hospitals: Guy's Hospital, St Thomas' Hospital and James Cook University Hospital. The interest in this business is part of Sainsbury's future plans to development new areas of business.

Former formats

Sainsbury's Freezer Centres
Main article: Sainsbury's Freezer Centres

Sainsbury's Freezer Centres were a frozen food chain operated between 1974 and 1986, the stores were entirely dedicated to frozen food. Due to competition from specialist frozen food chains such as Bejam, Sainsbury's converted its original service stores that were too small for use modern use to small frozen specialist stores.

Despite initial difficulty as only 11% of the population owned a freezer, the chain expanded to 21 stores at its height. As freezers became more popular, frozen food departments were designed into Sainsbury's main supermarkets, and the chain was sold Bejam in 1986, who were ultimately sold to Iceland in 1989.

SavaCentre
Main article: SavaCentre

SavaCentre was a chain of 13 hypermarkets operated between 1977 and 1989 in a joint venture with BHS. The stores ranged in size between 660,000 sq ft (61,000 m2) and 117,000 sq ft (10,900 m2). At the time of its inception it was the only dedicated hypermarket chain in the UK. The stores carried a complete range of both retailers products, and later included input from Habitat and Mothercare as they merged with BHS. In 1989 Sainsbury's bought out BHS's half stake, but still allowed BHS to retail from SavaCentres until they offered its own clothing and merchandise offering. From 1989 all SavaCentres were rebranded as Sainsbury's SavaCentres.

Sainsbury's SavaCentre
Main article: Sainsbury's SavaCentre

Sainsbury's SavaCentres were a chain of 13 hypermarkets operated between 1989 and 2005, after the ending of a joint venture with BHS, and a further 7 discount supermarkets, all solely operated by Sainsbury's. The stores ranged in size, the hypermarkets between 660,000 sq ft (61,000 m2) and 117,000 sq ft (10,900 m2), and the discount supermarkets between 31,000 sq ft (2,900 m2) and 70,000 sq ft (6,500 m2). Store layout consisted of a 50:50 split between food and non-food shopping and also included features such as a petrol station and in-store cafe.

Despite hypermarkets often being regarded as a key element in the future of a grocery chain business, in 2004 Sainsbury's decided that the SavaCentre business would be cancelled and the stores remodelled into being standard supermarkets, albeit very large ones. Some were shared with other retailers such as Next and Marks and Spencer. Most of the SavaCentres are still trading under the Sainsbury's fascia, with the same intent of having both a large food and non-food offering and additional facilities for its customers.

'Country town stores'

In the late 1990s Sainsbury's opened supermarkets in small towns that were known as 'Country Town' shops in-house. They were small supermarkets that provided a good range of products without shoppers having to travel far to large stores. From 2004 onward these stores were rebranded and thought of as standard Sainsbury's supermarkets, and still trade to this day under the supermarket category despite their small nature.

Sainsbury's Central
Main article: Sainsbury's Central

Sainsbury's Central was a format of larger convenience stores based in town centres and commuter areas, offering food-to-go and essential items but often also stocking selected lines from mainline stores. Central stores were rebranded as standard Sainsbury's supermarkets, albeit small ones, from 2004 onwards.

Sainsbury's Calais Wine Store

Sainsbury's operated one alocohol hypermarket in partnership with Auchan in Calais, France for the lucrative UK booze cruise market. The store closed in 2010 after describing the operation as 'economically unviable'.[103][104][105][106]

Sainsbury's Market

In 2002 Sainsbury's opened an experimental store in the Bluebird Building in Chelsea, London. The concept of the 'Market' store was to provide a large range of fresh meat, fish, delicatessen items and bread through colleagues serving over counters. Colleagues were specially hired for their skill and passion for their roles in store. The layout also provided a larger than usual area for retailing fresh produce. The store closed in 2004 after poor results.[107][108][109][110]

A second, much larger version in Pimlico was designated as a 'Market' store, but the stores branding and layout was gradually reverted to a standard Sainsbury's store.[111]

Fresh Kitchen

In 2011 Sainsbury's opened a trial food to go shop in Fleet Street London selling sandwiches, baguettes and hot snacks in an effort to expand its business into new areas of opportunity. The store closed a year later, after the stores lease was not renewed. Sainsbury's commented that footfall was too high to offer high standards of quality and service however it was not ruling out performing another trial in another location, explaining that it had learnt a lot.[112][113][114]

Sainsbury's Online

Main article: Sainsbury's Online

Sainsbury's operates an internet shopping service branded as "Sainsbury's Online". To use this service customers choose their grocery items online. Picking assistants then collect the required items from the shop floor which are delivered to customers from a company selected store by van. This is available to about 75% of the UK population. The service is run from mid-size to larger stores which carry the full product range (or as close as possible) – over 200 stores operate the service.

The service was initially known as 'Sainsbury's Orderline', and later 'Sainsbury's to You' and 'Sainsbury's Entertain You'. In-house the department is colloquially called online or GOL.

The main Sainsbury's website advertises links to all of Sainsbury's other online services:

Sainsbury's Entertainment

Sainsbury's Entertainment is a transactional website which provides films as downloads or for streaming, using Rovi Corporation software.[115] The site has arranged to register with ATVOD as a video on demand service.[116] The website also sells MP3 downloads as well as eBooks through aNobii.[117] The site has been transactional since 2010 and prior to March 2014 it also sold physical products including DVDs, CDs, Blu-ray discs and books. These were posted to the customer by a distributor, which after 2011 was Sainsbury's subsidiary company: Global Media Vault Ltd.[118][119] Customers receive nectar points from shopping at Sainsbury's Entertainment.[120]

Sainsbury's Energy

Founded in 2011, Sainsbury's Energy is a virtual utility provider in partnership with British Gas who offer gas and electricity. Sainsbury's often has face-to-face salespersons and advertising in it stores offering the service. Customers receive nectar points from using the service.[121][122]

Sainsbury's Compare and Save

Sainsbury's Compare and Save is a comparison and switching service website that promotes a wide range of television, broadband and telephone deals from a variety of providers. The service that is free to Sainsbury's customers, claims to list 15,000 different packages. The website and service launched in 2008 is operated by SimplifyDigital.[123]

Sainsbury's Gift Cards and Sainsbury's Business Direct

Sainsbury's Gift Cards and Sainsbury's Business Direct are transactional websites that sells gift cards, gift vouchers and food tokens with credit or value that can be spent at any Sainsbury store. Both products are not valid for buying certain products or services. The Gift Card website promotes the card as an ideal gift due to the large range of products and the number of stores available to spend them in. The Business Direct website, operated by MBL Solutions Ltd, promotes the cards as ideal for rewarding and motivating employees.[124][125][126][127]

Sainsbury's Bank

Main article: Sainsbury's Bank

In 1997 Sainsbury's Bank was established – a joint venture between J Sainsbury plc and the Bank of Scotland, later a part of the Lloyds Banking Group. Services offered include car, life, home, pet and travel insurance as well as health cover, loans, credit cards, savings accounts and Individual Savings Accounts.

Sainsbury's Bank also offers a Travel Money service in stores, with 'Sainsbury's Travel Money' opening the 100th Travel Money bureau in its estate in May 2010 at the Hempstead Valley shopping centre store. These foreign exchange bureaus are operated in association with Travelex and offer a full bureau de change service instore.

In 2013 J Sainsbury plc purchased the remaining 50% stake in the bank from Lloyds, meaning it now controls the bank.

Mobile by Sainsbury's

Main article: Mobile by Sainsbury's

In 2013 Sainsbury's moved into the UK telecommunications industry when it launched its own mobile phone network called Mobile by Sainsbury's.[128][129] The virtual network is operated in partnership with Vodafone. The company currently only provides a pay as you go service or a 30-day rolling contract bundle. Since its launch the service has been promoted heavily in store and most supermarkets started retailing SIM cards and handsets for the network.

Marketing and branding

Store fascias

Since 1869 Sainsbury's used various fascias using the title 'J Sainsbury'. This was replaced in 1999 to simply: 'Sainsbury's'. The flagship store in Greenwich, South London, first trialled the new look, leading to the term 'Greenwich Blue', which was used to describe the signature colour of new identity. After its success most stores were refurbished with dark blue walls, bright orange wall panels and grey shelving, as well as new checkouts. Individual counters also had different, brightly coloured panels behind them. Gradually the format was rolled out across the entire Sainsbury's estate.

Six years later another programme of refurbishment began, with the introduction of the new 'Try Something New Today' slogan. The entailed cream coloured shelving and checkouts, and a new aubergine-coloured staff uniform for all colleagues.

Old external signage bearing the 'J Sainsbury' name has still been found in use as recently as summer 2011 in Swindon, Ashbourne in Derbyshire and Blackheath, West Midlands.[130] It has also been found at the Rice Lane store in Liverpool in summer 2013.

Nectar loyalty card

Main article: Nectar loyalty card

Sainsbury's was a founding member of the UK's largest retail loyalty scheme called 'Nectar' in 2002. The scheme allows customers to earn points on almost everything bought from Sainsbury's as well as from other participating retailers in return for a large range of rewards. For every pound spent the customer earns 2 points. Sainsbury's also offers 1 bonus point for every carrier bag the customers reuses.

Sainsburys previously operated Sainsbury's Reward Scheme between 1995 and 2002 where customers used 'Reward Cards' or 'Storecards' to earn and spend points in a similar way, but limited to Sainsbury's businesses.[131][132]

Sainsbury's Active Kids

Main article: Sainsbury's Active Kids
File:Activekids5.jpg
A Sainsbury's Active Kids voucher worth 5 points
A Sainsbury's Active Kids banner outside a school. Tokens are collected at stores, and are redeemed for sports equipment.

Sainsbury's annually runs a voucher scheme for local organisations to redeem equipment for sports and other activities. Customers earn vouchers from their shopping which they donate to an organisation of their choice, who then redeem the vouchers with Sainsbury's, which credits their account with points to spend on items from a catalogue.

Brand ambassadors

Since 2000, Jamie Oliver was the public face of Sainsbury's, appearing on television and radio advertisements and in-store promotional material. The deal earned him an estimated £1.2 million every year. In the first two years of these advertisements were estimated to have given Sainsbury's an extra £1 billion of sales or £200 million gross profit.[133] Mr Oliver's deal mutually ended in 2011.[134]

Since 2010, paralympic swimmer Ellie Simmonds has been a Sainsbury's Active Kids ambassador.[135][136] Since 2012, former footballer David Beckham has been a Sainsbury's Active Kids ambassador, in a deal that is claimed to be worth over £3.5 million.[135][137][138] Both Simmonds and Beckham replaced Jamie Oliver as the face of Sainsbury's in an effort to emphasize the companies sponsorship of the London Paralympic Games.

Slogans

Sainsbury's currently uses the "Live Well For Less" slogan which was launched on 15 September 2011. Over the years, Sainsbury's has used many slogans:

  • "Quality perfect, Prices Lower" The slogan used on the shop-front of the Islington store in 1882.
  • "Sainsbury's For Quality, Sainsbury's For Value"- Used in 1918 above the Drury Lane store.
  • "Sainsbury's. Essentials for the Essentials."
  • "Good Food Costs Less At Sainsbury's" — Used from the 1960s to the 1990s. Described by BBC News as "probably the best-known advertising slogan in retailing." [139]
  • "Sainsbury's – Everyone's Favourite Ingredient" — Used in a series of TV commercials in the 1990s which featured celebrities cooking Sainsbury's food.
  • "Fresh food, fresh ideas. Eat healthy" – Used in 1998.
  • "Value to shout about" — A 1998/1999 campaign fronted by John Cleese which was widely claimed to have been a major mistake. Sainsbury's said it actually depressed sales. However, the company had been losing sales for years because of the rise of Tesco.[140]
  • "Making Life Taste Better" Introduced 1999 and used until May 2005.
  • "Try something new today" Introduced in September 2005 until September 2011.
  • "Value where it matters" Used in advertising from late 2010 until May 2011.
  • "Clothes You Can't Wait To Wear" Used in all new advertising for TU Clothing as part of advertising campaign throughout May 2011.
  • "Live Well For Less". Introduced in September 2011.
  • "Here's to Extraordinary". Used only throughout 2012 to promote sponsorship of the London 2012 Paralympic Games.

In 2008 it created a shopping incentive by showing that, when shopping at Sainsbury's, you can feed your family for only five pounds. The incentive, called "Feed your family for a fiver", with the flagship of "Meatballs 'n' More" had been advertised on British television channels, with Jamie Oliver cooking for a family.

Sainsbury's Active Kids is a loyalty voucher scheme by Sainsbury's.

Sainsbury's was a sponsor of the Paralympic Summer Games in London 2012, and it was the largest sponsorship signing in the history of the Games.[141]

Soundtrack on television adverts between 1999 and 2005 was always a backing version of 'Light and Day' by The Polyphonic Spree's.Since 2011 Sainsbury's have featured a variety of 1960's songs as a common feature of the soundtrack of its advertisements. Examples include the original version of The Bare Necessities (for food), On the Road Again by Canned Heat (for car insurance) and Mr. Rabbit by Burl Ives (for an Easter promotion).

Product ranges

A large store typically stocks around 30,000 lines of which around 20% are "own-label" goods. These own-brand lines include:

The own label Basics range is its low cost products
Name Description
Basics An economy range of around 700 lines, mainly food but also including other areas such as toiletries and stationery. The Basics range uses minimal packaging with simple orange and white designs. Sainsbury's Local stores sell none or very few of these lines.

Equivalent to Tesco's Everyday Value, Asda's Smart Price and Morrisons' M Savers.

Re-branding[clarification needed] started in September 2013.

by Sainsbury's All own-brand food products that are not part of any of the other ranges (over 6,500 different lines) have been re-branded as "by Sainsbury's". This was first introduced on frozen foods in late 2010, and the re-branding was completed in January 2013.[142]
Taste The Difference Premium-quality brand containing around 1100 food lines, including many processed foods such as ready-made meals and premium bakery lines. The range consisting of 1141 lines was re-launched in September 2010 when 75% of the range was improved or newly added.

TTD lines are similar to Asda's Extra Special, Tesco's Finest and Morrisons' Signature.

Be Good To Yourself Products with reduced calorific and/or fat content. The BGTY range was relaunched in January 2010.
FreeFrom Launched in 2002 but given a makeover in February 2010, it has over 75 product lines. These products are all grouped together in one aisle of the store (except fresh and frozen lines).[143] These products are suitable for those allergic to dairy, wheat and gluten (although some are free from wheat/gluten but contain dairy).
SO Organic Around 500 lines of food and drink which are derived from sources free from fertiliser or pesticides.
TU The own-brand clothing range, which had a full re-brand in 2013.[144]
TU Home A range of home products, such as lighting, rugs, and kitchen products. This range has now been rolled out to most stores stocking non-food ranges. After the success of its own brand range, Sainsbury's will rebrand this range into the 'by Sainsbury's' range in August 2013.[145]
Home Collection A range of quality home products, such as cutlery, crockery, kitchenware and bed linen.

Former ranges

Name Description
Jeff & Co. The predecessor to TU clothing, designed by Jeff Banks.
Different by Design The non-food equivalent of Taste the Difference, which included some flowers (which were previously branded "Orlando Hamilton"). Used the same logo and typeface as Taste the Difference.
Kids Lines targeted at children (2006–2012).
Blue Parrot Lines targeted at children (until 2006).

Staffing

Across all of its businesses Sainsbury's employs roughly 157,000 people who are referred to as 'colleagues'. Colleagues benefit from a percentage discount, varying throughout the year, on most products, varying discounts on Sainsbury's Bank products and access to various discounts at hundreds of other retailers. Whilst the majority of colleagues do not belong to a union the company maintains good relationships with unions representing colleagues, the most popular being The Union of Shop, Distributive and Allied Workers (USDAW).

In 2013 Sainsbury's won the Employer of the Year at the Oracle Retail Week Awards.[146]

Sainsbury's runs a wide variety of payroll 'extras' for colleagues, the main being a percentage bonus on a store by store basis for successful customer and availability scores throughout the year. Other optional extras include contributory pension schemes, investment in shares, loans for public transport tickets and grants for bicycle purchase.

In 2010 Sainsbury's opened seven food colleges that teach fishmongery, butchery, breadmaking and confectioning. 21,000 colleagues have been trained at these venues so far.[147] Qualifications can be gained through in house training, and so far 15,400 colleagues have been awarded City and Guild qualifications.[147]

MySainsburys is a social and information website for colleagues to use to access colleague benefits and information, and to interact with other colleagues.[148]

Sainsbury's graduate scheme called '2020 Leaders' aims to recruit and develop potential leaders for the most senior roles of the company.[149][150] Graduates can choose from three areas to develop into: Commercial, People or Logistics and Supply. The scheme was listed in The Times Top 100 Graduate Employers 2013 and The Job Crowd Top Companies for Graduates to Work For 2013.

Employee relations

Youth Forum

A group exclusively for colleagues aged 25 and under focuses purely the interests of the companies 47,000 colleagues who fall into this age category.[147][151][152]

Sainsbury's Staff Association

Sainsbury's Staff Association was founded in 1947. It is owned and run by the colleagues of Sainsbury's. Any permanent colleague can join at a cost of £1 every 28 days for one person (or £1.20 every 28 days for two people). The funds raised are collected into accounts in every store, and spent on whatever the stores SSA colleagues wish, usually social events and experiences out of store. Benefits also include further discounts with other retailers.[153]

Sainsbury's Veterans Association

Sainsbury's Veterans Association was started in 1947 by 8 colleagues who wished all colleagues to stay in touch with each other. Today members enjoy a range of benefits including Honorary SSA membership, 10% discount, newsletters, invitation to an annual reunion, a visitor service, birthday and anniversary gifts, donation upon bereavement and transfer of benefits to spouse upon death. To qualify colleagues have to serve twenty-five years with the company. The associations presidents are former Sainsbury's CEO and later Chairman Lord Sainsbury of Preston Candover KG and former Sainsbury's CEO Dino Adriano.[154][155]

Controversies

Online only recruitment

In November 2007, Sainsbury's became the first major British employer to introduce an "internet only" staff recruitment system. At the time, it was estimated that the move would save the company £4million a year in administration costs.[156] This move came at a time when only approximately half of the British adult population was estimated to have access to the internet at home, though by 2010 it was estimated that more than 80% of the adult population had internet access.[157] Several big retail names, including Marks & Spencer, adopted online recruitment at around the same time but have set aside a telephone recruitment system as an alternative for prospective employees who do not have internet access.[158]

Treatment of overseas workers

In a 2006 report the British anti-poverty charity War on Want criticised the conditions faced by Kenyan workers supplying Sainsbury's with cut flowers.[159]

Food safety prosecutions

Sainsbury's supermarkets have been prosecuted for selling food past its use by date on more than one occasion,[160][161] evidence also showed that some staff did not have the correct training to carry out their duties involving food safety.[161] In the UK, the use by date is displayed only on meats and other foods that carry a risk of bacterial disease when kept too long or not stored correctly, and Sainsbury's would not have been prosecuted for selling foods past the 'display until', 'best before', or 'sell by' dates.

Removal of kosher products

In 2014, a photograph surfaced on Twitter showing that the Holborn Sainsbury's franchise removed kosher products from its shelves. Complaints began appearing on social media that removing food that is consistent with Jewish dietary restrictions and is produced all over the world was an act of discrimination against Jews.[162] In response to the negative publicity, the kosher products were restored to the shelves and the staffer who removed the kosher products was reprimanded.[163] However, in a call by i24news correspondent Jonathan Sacerdoti to the Sainsbury's Careline, the Sainsbury's rep defended the store's actions, calling them prudent in the face of threatened obstruction to the store.[164]

Distribution

Sainsbury's distribution centre in Waltham Point

Sainsbury's supply chain operates from 13 regional distribution centres (RDCs), with two national distribution centres for slower moving goods, and two frozen food facilities. In addition, the depot at Tamworth tranships general merchandise to the RDCs.[165] Each depot is given a "Depot Code".

Bonded distribution centres
  • Allington, Maidstone, Kent
Regional distribution centres
Regional distribution centres – Slow Moving
Regional distribution centres – Frozen
National Distribution Centre – General Merchandise
National Distribution Centre – Clothing

Sainsbury's also has a depot at Buntingford Hertfordshire. This depot is usually not in operation; however Sainsbury's still own the site and continue to use the depot at busy times, particularly at Christmas. Buntingford, on the A10 road, is ready for use as an emergency depot for the rest of the year.

Originally Sainsbury's ran its own distribution network. However after an industrial dispute with their drivers in the 1970s, and with the intention of streamlining and consolidation, much of the distribution is now contracted out – to distribution specialists such as TDG, DHL, NFT & Wincanton.

Archive

Sainsbury's archive of over 16,000 items relating to the business since its foundation is now kept at the Museum of London. The archive is particularly rich in the product packaging, advertising and retail stores areas.[166]

See also

References

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