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Retail Intelligence

Weekly Round Up, April 29, 2014

By Publications Checkout
Weekly Round Up, April 29, 2014

Dunnes Stores has been criticised for reportedly offering contracts of less than 15 hours a week to staff. Mandate Trade Union, the retail representative for Dunnes employees, has claimed the supermarket chain is in breach of a long-standing agreement it has with the union on minimum working hours. Mandate says that in 1996 it agreed a deal with Dunnes that meant it was obliged to offer 15 hours or more to staff but now has evidence that it is offering lower-hour contracts. Gerry Light, Mandate assistant general secretary said, “The time is long overdue for Dunnes Stores to sit down and fully honour its obligations under this agreement. First and foremost, there is an absolute obligation in that agreement that the minimum contract is for 15 hours. The timing for talks is more appropriate than ever. We don't want our members' terms and conditions falling any more behind their main competitors in the retail sector." Other concerns for staff include a multitude of pay scales for staff, including pay rates that may be close to the minimum wage. Light said that Mandate aims to get ‘banded hour contracts’ similar to Tesco, SuperValu and Penneys for Dunnes Stores staff. A campaign was launched to tackle the ‘ongoing deterioration of employment standards for Dunnes workers nationally,’ of which Mandate represents 4,000.

South County Dublin town Dalkey has been announced as Ireland’s first SmartNetTown™, with the introduction of a technologically advanced customer engagement loyalty programme. The system involves merchants in town using Value Nation’s™ LolliPoints™ (a currency) to engage customer loyalty. These points can be redeemed in the same shops to receive discounts and special offers. During the past three month trial in Dalkey, the total amount spent in Value Nation™ transactions, using the Value Nation™ app, is €653,000. The current number of people in Dalkey using the Value Nation™ system is 2852, while the average total spend for customers during the period in the participating stores is €229. €39,700 has been awarded in LolliPoints™ - the currency used by Value Nation™ for customer rewards. Just under a third of this (€12,300) has been redeemed by loyal customers. While at the start of the trial there were just a few merchants on board, this has grown to an impressive 20 merchants for the Dalkey area at the time of launch.

Premier foods, the British food producer behind the likes of Mr. Kipling’s, Bisto gravy and Ambrosia, recorded a sales decrease of 6.2% to £186.3 million (€226million) with sales of its top eight grocery brands down 3.5%, while non-branded products and supply brands slumped by 12.9% and 10.4% respectively. Gavin Darby Premier Foods chief executive said, “While trading conditions are expected to remain challenging […] we have a strong programme of new product launches and consumer marketing planned for the second half of the year.” Last month the business announced a £1.13billion (€1.37billion) refinancing plan that it hopes will cut borrowing following a costly reshaping scheme over the last few years and cost cutting to reduce debt that included a new pension agreement. Shares in the company are up 31% on last year, however at 62.5p (77c) each valuing the group at £524million (€636million). 

Procter & Gamble (P&G) has reported strong profits in the most recent quarter, helped by increased sales in products like detergent and air freshener. Organic sales increased by 3% but the exchange rate of the US dollar quickly eroded any benefits. Net sales in the third quarter remained stagnant in the third quarter however, and the firms investors are urging faster growth in order to lift share prices after they slipped by 1% to $79.85 (€57.71). Under shareholder pressure P&G is selling a large proportion of its pet food business to Mars for $2.9billion. The consumer product company launched a five year restructuring plan in February that seeks to cut expenses by streamlining management, lowering overhead costs, cutting jobs and reducing marketing costs with profits in some markets disproportionate to the amount spent on marketing. 

Jameson Irish Whiskey have increased net sales and sales by volume of 13% and 10% respectively over the last nine month period. In addition, its parent company Pernod Ricard reported a 7% drop in overall sales to €6.16 billion during the period. Much like its competitor Diageo, the drinks giant has attributed the loss to unfavourable foreign exchange rates. Pernod Ricard stated that sales of its top 14 brands were basically stable (-1%) and welcomed a return to growth among its Scotch whisky category and well as a rise in overall sales in Europe and the Americas. Pierre Pringuet the company’s CEO said, “In an environment that remains challenging, our performance over the nine months was in line with the half-year and with our annual guidance.” 

Bord Bia has teamed up with Google Ireland to launch a new training programme to help Irish food businesses improve their online presence and boost e-commerce. The ‘Digital Food Hub’ is a seven-month programme specifically designed for the Irish food industry and will include workshops, training modules and one-to one mentoring held in Google’s European Headquarters in Dublin. A total of 21 companies are participating within meat, dairy, confectionary and chilled food sectors including local, national and multinational companies both new and old. Bord Bia expects 94% of Irish consumers to shop online by 2015, which will be aided by current technological advancements and increasing portable device ownership such as smartphones and tablets. Bord Bia CEO Aidan Cotter said, “It is widely recognised that technology is one of the key drivers of change in terms of consumer buying behaviour. Both brands and retailers need to think outside the confines of the ‘bricks and mortar’ store to build stronger and longer lasting relationships with consumers.”

Farmers were satisfied with a lift in cow and bull prices last week in the aftermath of the Beef Summit held by Minister of Agriculture, Food and the Marine, Simon Coveney. The talks sparked a slight improvement in trade, with prices for good cows up 10-20 c/kg, U grades making up to 350 c/kg and Rs getting 340 c/kg. O grade cows were getting up to 315 c/kg, however steers and heifers prices were unchanged from 395 c/kg. Factory demand for bulls increased and paid 370 c/kg for mixed loads of R and U grade meat. Minister Coveney has promised farmers the launching of a 'Beef Pricewatch' online service to make price information more accessible to farmers among other improvements in the sector. 

Irish people were found to be eleventh most satisfied in their jobs in Europe according to a study by European statistics agency Eurobarometer. More than 80% of Irish people surveyed said they were satisfied with their current working conditions which was higher than Greece (38%), but lower than Denmark (94%). The Eurobaromoter research also revealed that most European workers benefit from appropriate work breaks and holiday periods while 90% get at least four weeks of paid holidays per year. In addition, the majority of employees said they have access to some form of flexibility at work, like special leave or working from home. 

A recent change voted by Limerick County Council to allow new stores to have a net floorspace of 1,400 square metres could open the way for an Aldi store in the Raheen, Dooradoyle area. According to the Limerick Leader, the allocation of floorspace was previously 900 square metres and Aldi has been campaigning for the change for a number of years. While the county council’s planning section and manager have consistently opposed the change, it went out for public consultation earlier this year and nine submissions were received. Aldi is currently planning three stores in the Limerick area with many concerns from Limerick Chamber of Commerce about the impact of the stores in areas already serviced by other supermarkets and retailers. As the changes were opposed by planning management, the matter will now go to the Minister for the Environment, Community and Local Government with the possibility of it going to cabinet for a final decision.

SuperValu held its 2014 SuperValu Quality Awards to highlight excellent food hygiene and safety standards in its stores. Commended stores across the country completed the SuperValu National Hygiene and Food Safety programme which is independently audited by Joe Comerford, with the Supreme Hygiene Award identifying and rewarding retailers that have performed to a consistently high level over a three year period. Martin Kelleher, Managing Director, SuperValu, said; “This is a fantastic endorsement for SuperValu retailers and a real testament to the efforts of their management team and staff. The Quality Awards recognise continued commitment to maintaining excellent hygiene and food safety standards. Year-on-year these entrepreneurial food retailers continue to push out the boundaries of excellence, with three quarters of the SuperValu stores audited receiving the much sought after Supreme Hygiene Award.” 

© 2014 - Checkout Magazine by Genna Patterson

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