Morrisons have seen a strong financial half year, with revenue up 4.5% to £8.80bn. There has been sustained strong underlying profit growth and cash flow for the retailer.
David Potts, Chief Executive of Morrisons, said: “Strong growth, including our best quarterly like-for-like sales for nearly a decade” “Morrisons continues to become broader, stronger and a more popular and accessible brand, and I am confident that our exceptional team of food makers and shopkeepers can keep driving the turnaround at pace.”
Morrison’s turnaround strategy is to Fix, Rebuild and Grow, driven by six priorities, has now been ongoing for more than three years.
Update on the Morrisons 6 priorities:
- To be more competitive
Morrisons are fully integrating their manufacturing and retail operations, with removing third party middle men, the aim is to see a reduced cost. New Product Development is another area being focused on. Morrisons have been focusing on wonky fruit and vegetables, which are low priced but of a good quality. Morrisons has recently won Innovative Own Label Retailer of the year at the Grocer Food and Drink Own Label awards.
- To serve customers better
Morrisons have been selling local loose eggs in 200 stores, which leads to increased consumer choice and emphasising that Morrisons has a keen focus on provenance. Morrisons have also removed film packaging in some vegetable products and provided paper bags for fruit and vegetables, instead of plastic bags. Reducing plastic waste is an area where Morrisons will continue develop.
- Find local solutions
Morrisons continue to expand their local offer of products. 350 stores now sell seasonal, local fruit and veg. There have been six regional food maker roadshows around Britain and sales of local suppliers’ products were up a further 30% during the first half of the financial year.
- Develop popular and useful services
Pick up services such as amazon have become very popular with consumers. There are also plans to develop food service units on surplus land.
- Simplify and speed up the organisation
The structure of staff has been adapted. Morrisons are improving systems, with less managerial roles. In food manufacturing, they are introducing improvements to the way fresh commodities flow, which will improve delivery accuracy and product quality.
- To make core supermarkets strong again
Morrisons are adapting their in store experience for customers, giving their supermarkets a fresh look. Over half of Morrison’s stores have gone through the fresh look program.
The UK food retail market continues to be highly competitive and dynamic, and there is some continuing consumer, economic and political uncertainty, particularly as Brexit approaches. The NFU will continue to have conversations with Morrisons look forward to hearing more about their long term development.