Sainsbury's boss Mike Coupe: It's 'nonsensical' to say Sainsbury's and Argos don't work together

The retailer completed the acquisition of Argos owner Home Retail Group in September and is now in the process of integrating the two businesses.

Sainsbury’s launched its ‘supermarket of the future’ at Nine Elms earlier this month, containing an Argos digital concession, mini Habitat store, eBay click-and-collect desk and an enlarged Tu clothing area.

But despite unveiling the new-look format, a number of sceptics are still to be convinced on the rationale behind the £1.4bn deal.

Coupe was again pressed on the overlap between Sainsbury’s and Argos shoppers by audience members at the IGD Big Debate in London this morning.

“The idea that two mass-market brands don’t work together, I think, is nonsensical,” Coupe said.

“The idea that two mass-market brands don’t work together, I think, is nonsensical”

Mike Coupe, Sainsbury’s

“I’ve heard this over and over again, the idea that somehow a Sainsbury’s shopper sees an Argos shopper, they cross the road and walk around them.

“Around about two thirds of the UK population shop in a Sainsbury’s shop in a year, around about two thirds of the population shop in an Argos shop in a year and about 40% shop in both.

“That says there’s a degree of overlap and opportunity.”

Hard work starts now

Despite his confidence in the deal, Coupe admitted that the hard work started now for Sainsbury’s in order to deliver the benefits and synergies that he and new Sainsbury’s Argos boss John Rogers had laid out to the City earlier this year.

“I have no idea how customers’ shopping habits will change over the next period of time, but what I do know is that, if we have a flexible supply chain, a fast supply chain, an efficient supply chain and multiple points of presence, then we are in a position to compete with whatever happens in the market place,” he added.

“The acquisition of the business, in many respects was the easy bit.

“We’ve owned it for four or five weeks – so far so good – but, of course, our challenge now is to deliver the difficult bit.

“That is to get on and deliver the business change so that we can provide our customers with that fantastic level of service and speed across a business that will have unparalleled choice in clothing, general merchandise, food and financial services.”