Sainsbury’s looks beyond China for further emerging markets

Sainsbury’s group development director Darren Shapland said: “We will consider other emerging markets including India but at the moment China is the only international market where we currently have resources.”

Shapland said Sainsbury’s has a sourcing office of about 100 people in Shanghai, and a team of six dedicated to scoping out the retail market in China. The retail team was set up three months ago and is carrying out extensive consumer research, “looking at Chinese homes, how they shop, cook, live”, he said.

He maintained opening in China is “being reviewed as part of the long-term growth of the business” as “our three to five year plan is already set out”. However, he said: “If the review says we should do something quicker then we will.”

Sainsbury’s this week revealed that customer numbers are at an “all-time high” as it unveiled an 8.1% increase in underlying pre-tax profit to £332m in its results for the 28 weeks to October 2. Total sales including VAT were up 7% to £11.9bn and like-for-likes including VAT but excluding fuel were up 2%.

King said the grocer’s coupon at till promotion, which is a year old, will be “a bigger part of our Christmas campaign than last year”. Sainsbury’s will launch its festive ad campaign on Monday.

He said Sainsbury’s is outperforming the market because it is “delivering on what we set out at the start of the turnaround”.

He also explained that Sainsbury’s is a touch below the market in the amount of promotions, with Sainsbury’s about 34% to 35% and the rest of the market around 36% to 37%. He said this is due to its push on own-label, which is a larger proportion of sales than the rest of the big four. He said: “We launched Switch & Save to push the value of own-label and own-label remains strong.”