Conviviality boss Hunter downplays impact of Aldi's online wine launch

The Bargain Booze and Wine Rack owner posted a rise in half-year profits as retail sales edged up 0.8% in the 27 weeks to November 1.

Like-for-like sales dipped 1.3% during the period, but rose 1.1% during the two weeks to January 3. Its Wine Rack fascia recorded an 11.1% jump in like-for-likes despite a “highly competitive” market.

But Hunter said Conviviality can continue to compete, despite the fierce battle for alcohol spend.

Competitive market

Aldi started selling wine by the case online last month, while Majestic Wine’s retail sales rose over Christmas as its strategic plan started to bear fruit.

And Conviviality’s supermarket rivals have continued to invest in price, putting further pressure on the Bargain Booze and Wine Rack chains.

“Our stores are located where our customers want them and location is the key driver of store choice, so I am very confident that we are well positioned to grow in the market”

Diana Hunter, Conviviality

Hunter said the fascias maintained a price position that was 12% cheaper than the multiples, but said its overall proposition – including a new ‘try before you buy’ initiative – remained appealing to shoppers.

“Our stores are in very convenient locations, the ones that we open will be in convenient locations for our target customers and the convenience market continues to grow,” Hunter told Retail Week.

“All of the consumer trends that we see show that people favour shopping little, often and local. Our stores are located where our customers want them and location is the key driver of store choice, so I am very confident that we are well positioned to grow in the market.

“Aldi is a very strong business, it has done a very good job of growing in the UK market and I think they are here to stay, therefore everyone should pay attention to what it is doing.

“But our strategy is to make sure our proposition is clearly differentiated and that we communicate our value for money, choice and convenience very clearly.

“We are very clear on how we stand out and how we are different from our supermarket and discount competitors.”

Expansion plans

Conviviality will further ramp up its proposition by increasing the number of SKUs available via click-and-collect from 100 to 1,000. It currently offers the service in 158 of its stores.

And Hunter hinted that it could seek to acquire other businesses to accelerate its expansion plans. It completed the purchase of drinks supplier Matthew Clark in a £200m deal last October.

“There is no doubt that other opportunities will appear in the coming year or years,” Hunter said.

“I think everyone has been talking about consolidation in the market. We will keep a close eye on what’s happening in the market, as we always do.”