Talking Retail Grocery and product news for independent retailers
Known for his no-nonsense approach and refusal to jump on the latest bandwagon when it comes to retail fashions, Kinney boasts an impressive 40-year career in the sector that has included stints with Safeway and Booker as well as three years helping deliver new stores and refurbishments for Sainsbury’s.
Prior to the coming together of Today’s and Landmark in 2018, he spent 10 years as retail director with Today’s and post-merger has served as both retail director and sales and marketing director at Unitas.
Next phase
Since taking on the top job in April, Kinney has been joined by a new non-executive chairman in the shape of Mark Aylwin. Another former Booker and Safeway man, Aylwin said he was looking forward to joining the group “to support John and the board in the next phase of its journey”.
According to Kinney, the first phase of that journey mainly focused on work behind the scenes to bring together internal systems and processes among the group’s 159 members, who between them comprise the UK’s largest network of independent cash and carry and delivered wholesalers.
“It’s now the next stage, which is about taking this business forward,” he tells Independent Retail News. A “root-and-branch” review of the group’s activities has just been carried out, with the aim of creating an organisation driven entirely by the needs of its members. But what differences are the group’s retailers likely to see?
Symbol strategy
Between them, Unitas member wholesalers serve more than 760 stores under the Lifestyle and Today’s brands, while a further 247 stores operate under various fascias belonging to its individual wholesalers. “Symbol remains a strong strategy for the members going forward,” says Kinney.
“Growth has obviously been impacted by Covid, so we did see a slowdown in recruitment.” Where the usual target was to recruit between 100 and 120 new symbol stores every 12 months, that fell to between 80 and 100 last yearbut is now back on track.
“A lot of retailers were reluctant to move and because their sales were buoyant during lockdown, they didn’t want to be disrupted. We also furloughed our development teams at the height of the pandemic, but they’re all back now and they’re reporting a healthy pipeline going forward.”
While symbol group members make up a growing minority, the heartland for Unitas when it comes to retail remains cash and carry, with about 3,500 non-fascia stores served by the group.
Kinney says the group’s wholesalers need to balance the needs of their symbol members, who are concerned with service levels and the overall quality of the offer, with the needs of those non-affiliated members who remain primarily focused on price and promotions.
“Our role here is to make sure we’re supporting all of those members,” he says.
Practical measures
That support will include practical measures such as helping retailers reduce their cost base, through everything from utility bills to drop-shipment services, waste collection to telephony bills. There will also be a big push to help retailers with social media skills and practical category management advice through the revamped Plan for Profit programme, which has recently seen the addition of several new guides.
“We’re going to drive the category management agenda strongly,” Kinney says. “That will be a big priority for us going forward.”
While he believes those store owners who have benefited from increased custom during the pandemic and can maintain good hygiene practices in-store will continue to reap the rewards, Kinney is realistic enough to admit that it won’t all be plain sailing for the group’s independent retailers.
Headwinds are likely to include the upcoming legislation around food and drink deemed to be high in fat, sugar and salt (HFSS), which Kinney fears could impact the amount of investment by suppliers into promotions within the independent sector.
Promotional threat
Although smaller stores should be exempt from rules governing, for example, whether they can place HFSS products near the till-point, he fears this knock-on effect on suppliers could nevertheless impact the whole sector. “If the investment isn’t there, there won’t be a promotion to run, or a product there to promote.”
In a similar vein, he worries that the different deposit return schemes for drinks containers planned in England and Scotland could make some SKUs unviable, especially for small producers, again reducing the choice of product available to independents. “That’s going to be an absolute nightmare,” believes Kinney. “Potentially a bigger issue than HFSS.”
Dark stores
He also sees a big threat coming from home delivery start-ups, specifically those companies looking to operate out of ‘dark’ stores and compete with traditional convenience. “They are coming in to take a slice of our pie,” he says. “There will always be role for the independent stores, but it’s just picking off some of what we do.”
Nor does he believe the solution is for smaller stores to offer their own home delivery service. “It’s just not practical when you’ve got small stores and limited numbers of staff.
“It’s definitely not right for everyone, especially if you don’t have a huge offer, particularly in fresh food.” Smaller stores running delivery services were now finding it mainly consisted of “late night transactions” on products such as cigarettes and alcohol. “It’s very challenging,” Kinney says.
Delivery problems
Add to this staff issues caused by the pandemic, driver shortages impacting deliveries and the upcoming increase in the minimum wage, and Kinney predicts a difficult time ahead for independents. “It’s a tough market out there. Margins are constantly being eroded and costs are going up,” he says. But he is confident the sector is resilient enough to weather this storm and adjust its offer accordingly.
“Part of the challenge is being responsive to the new market place going forwards. But if they can adapt, there are a lot of opportunities out there.”
The primary role of Unitas in all this, he believes, is to serve its wholesalers to the best of its abilities. “It’s helping our members operate as effectively and efficiently as possible to allow them to compete. If we are doing our job here, then retailers should see that coming through in improved prices and margins.”
By David Shrimpton, Editor
