Poor trading at former Somerfield stores is holding back the Co-operative Food business, a report today from The Independent claims.
Mutual retail organisation The Co-operative bought grocery chain Somerfield and its 650 stores nearly three years ago in a deal worth £1.6 billion, but it appears that the retailer is still struggling to integrate the smaller business into its group.
According to an internal memo seen by The Independent, ex-Somerfield stores posted a 3.38 per cent fall in like-for-like (LFL) food sales over the eight weeks to February 25th 2012 while the Co-op’s own food stores witnessed a LFL rise of 0.13 per cent over the same period.
In just the first eight weeks of its financial year, total sales at Co-op Food, excluding fuel, were already reportedly £15.55 million lower than anticipated, adding further pressure on the business at a time of economic difficulty.
As many as 300 head office jobs are understood to have been cut last week by the Co-op as a reaction to what it described as the “toughest trading conditions in recent history”.
These difficult conditions have been made worse by a rise in the number of customer complaints occurring across its 3,000 store portfolio, according to another recent memo at the business.
Problems listed by the group, set-out in the document, included “general rudeness of staff – no eye contact, no please or thank you, talking to colleagues, not asking for membership cards, queues and overcharging”.
In the sixth week of its financial year starting January, Co-op recorded 447 complaints at its stores, up from 333 in week three, and apparently “staff attitude complaints continue to be in the 100s” each week.
A spokesperson for The Co-operative Group said: “We don’t comment on leaked information. We will be announcing the group’s annual results at the end of March, which will demonstrate the progress we are making to transform and modernise our food business.”