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How UK discount is evolving: online, convenience, new players

With COVID-19 impacting the way people shop, each channel has had to adapt to satisfy changing shopper needs. The discount channel has had a mixed experience dealing with these changes throughout the pandemic. Sales have been negatively impacted due to shoppers using fewer channels and avoiding smaller stores.

For the variety discounters, such as Poundland, they have also had challenges including temporary store closures due to reduced footfall. Across the channel, there has also been the wider question over how to respond to the rising demand for online. In this article we look at how the discount channel is evolving due to the changing trading environment.

Variety discounters Poundland and B&M looking to develop their online proposition

We have seen a mixed response to the rise in demand for online services in the discount channel.

With Lidl remaining firmly committed to its store-first strategy and Aldi dipping its toe into ecommerce with the launch of its click and collect service. Now we are seeing a response from the variety discounters; Poundland has launched a trial home delivery service in Ireland.

It will initially be available to 18,000 staff and selected guests. There will be a limited range of products of around 2,000 available, including food and general merchandise. This follows the retailer closing one of its stores in the UK (Cannock), to convert it to an online fulfilment centre.

Poundland has said it will begin trialling online delivery in the UK in 2021. B&M has appointed Jens Sorensen as a new digital director. His previous position was as The Range's chief digital and omnichannel officer.

Although B&M has not commented on what his role will be, or whether they are moving into e-commerce, his appointment suggests the retailer may be focusing more online in the future. In France, the retailer launched a click and collect service in 2020 and it is likely it will be looking to this market for learnings in the future. For subscribers looking for more insight, check out our How will discounters respond to online?

Aldi and Poundland trademark convenience formats 

We are increasingly seeing the discounters adapting their propositions to suit smaller locations, for example the launch of Aldi Local in 2019.

Further developments are potentially on the horizon as we see retailers trademarking new format names; Aldi has trademarked 'Shop & Go' with the Intellectual Property Office. This is likely to be linked to a new checkout-free solution, such as a pay-and-go app, as this requires less investment from the retailer than a new store format or self-scanning technology.

To find out more about potential technology innovation at Aldi, read our Aldi explores checkout-free solutions article. Poundland has applied to trademark 'Poundland Local' and 'Poundland Go!', pointing to its latest plans for new convenience store formats. Poundland Local is to apply to stores in small towns and close to urban neighbourhoods, while Poundland Go! is for a new convenience format near transport hubs.

The retailer first announced it would be segmenting its store estate in July last year. As part of the process of revamping its existing estate and opening new stores, it will be splitting its stores into three format categories:

  1. Destination stores offering the full range of products including food, homeware, health and beauty and clothing
  2. Core stores offering a wide range of products on high streets
  3. Convenience stores offering "grab and go" easy shopping

Poundland has also recently added its new chilled and frozen range to 46 stores, bringing its total stores carrying the range to 175. The plans is to roll it out to over 500 stores.

It also opened its 350th Pepco shop-in-shop this month. Both of these additions to the stores show the retailer is looking to satisfy different, wider missions, giving shoppers more reasons to visit. For subscribers looking for more insight on the convenience channel, check out our three part series on how you can grow in the convenience channel.

New players: Mere and JFT Central

Two new value retailers look set to open in the near future, adding more competition to an already competitive sector;

Russian retailer Mere aims to open four stores in the UK. Svetofor is a Russian discounter that has 3,200 stores worldwide. The company expanded to Europe in 2018, operating under the name Mere.

It will open its first store in the UK by the summer in a former Nisa branch in Preston, Lancashire. The other stores will open in Wales and Yorkshire. Following this, the retailer is said to be looking for future expansion across the UK.

The retailer claims to be 30% cheaper than Aldi and Lidl and operates a hard discount model with no marketing, and few staff. Stores will have around 1,200 SKUs. JFT Mega Discount Warehouse is opening a new format. It currently has 12 outlets on retail parks in the Midlands and the north of England.

The warehouse and online business currently sells a wide range of products including food & drink, health & beauty, garden, and DIY products. Customers have to sign up to a free membership scheme to shop in its warehouses. Its new format will be called JFT Central, and it will be another value-based variety store.

The retailer has said it is looking to open at least 50 stores, according to The Times. It will be run by Jeremy Coombes, a corporate financier with experience in lending to small and medium-sized enterprises. He said that the market was full of opportunity because of low-rent deals currently on offer as landlords were desperate to fill empty units.

The first opening is set to be in Hull in a former Mothercare store. We do not currently know the opening date.

Final thoughts

Going forwards the discount retailers will need to find more ways to remain relevant in the changing environment. With retailers such as Tesco and Sainsbury's offering price matches to Aldi, the low price differentiator is not as strong as before.

Expect more development in the channel as the retailers look to satisfy the rising demand for online, and different shopping missions. 

Looking for more insight?

Discount newsletter

Categories
Coupons & Offers

How UK discount is evolving: online, convenience, new players

With COVID-19 impacting the way people shop, each channel has had to adapt to satisfy changing shopper needs. The discount channel has had a mixed experience dealing with these changes throughout the pandemic. Sales have been negatively impacted due to shoppers using fewer channels and avoiding smaller stores.

For the variety discounters, such as Poundland, they have also had challenges including temporary store closures due to reduced footfall. Across the channel, there has also been the wider question over how to respond to the rising demand for online. In this article we look at how the discount channel is evolving due to the changing trading environment.

Variety discounters Poundland and B&M looking to develop their online proposition

We have seen a mixed response to the rise in demand for online services in the discount channel.

With Lidl remaining firmly committed to its store-first strategy and Aldi dipping its toe into ecommerce with the launch of its click and collect service. Now we are seeing a response from the variety discounters; Poundland has launched a trial home delivery service in Ireland.

It will initially be available to 18,000 staff and selected guests. There will be a limited range of products of around 2,000 available, including food and general merchandise. This follows the retailer closing one of its stores in the UK (Cannock), to convert it to an online fulfilment centre.

Poundland has said it will begin trialling online delivery in the UK in 2021. B&M has appointed Jens Sorensen as a new digital director. His previous position was as The Range's chief digital and omnichannel officer.

Although B&M has not commented on what his role will be, or whether they are moving into e-commerce, his appointment suggests the retailer may be focusing more online in the future. In France, the retailer launched a click and collect service in 2020 and it is likely it will be looking to this market for learnings in the future. For subscribers looking for more insight, check out our How will discounters respond to online?

Aldi and Poundland trademark convenience formats 

We are increasingly seeing the discounters adapting their propositions to suit smaller locations, for example the launch of Aldi Local in 2019.

Further developments are potentially on the horizon as we see retailers trademarking new format names; Aldi has trademarked 'Shop & Go' with the Intellectual Property Office. This is likely to be linked to a new checkout-free solution, such as a pay-and-go app, as this requires less investment from the retailer than a new store format or self-scanning technology.

To find out more about potential technology innovation at Aldi, read our Aldi explores checkout-free solutions article. Poundland has applied to trademark 'Poundland Local' and 'Poundland Go!', pointing to its latest plans for new convenience store formats. Poundland Local is to apply to stores in small towns and close to urban neighbourhoods, while Poundland Go! is for a new convenience format near transport hubs.

The retailer first announced it would be segmenting its store estate in July last year. As part of the process of revamping its existing estate and opening new stores, it will be splitting its stores into three format categories:

  1. Destination stores offering the full range of products including food, homeware, health and beauty and clothing
  2. Core stores offering a wide range of products on high streets
  3. Convenience stores offering "grab and go" easy shopping

Poundland has also recently added its new chilled and frozen range to 46 stores, bringing its total stores carrying the range to 175. The plans is to roll it out to over 500 stores.

It also opened its 350th Pepco shop-in-shop this month. Both of these additions to the stores show the retailer is looking to satisfy different, wider missions, giving shoppers more reasons to visit. For subscribers looking for more insight on the convenience channel, check out our three part series on how you can grow in the convenience channel.

New players: Mere and JFT Central

Two new value retailers look set to open in the near future, adding more competition to an already competitive sector;

Russian retailer Mere aims to open four stores in the UK. Svetofor is a Russian discounter that has 3,200 stores worldwide. The company expanded to Europe in 2018, operating under the name Mere.

It will open its first store in the UK by the summer in a former Nisa branch in Preston, Lancashire. The other stores will open in Wales and Yorkshire. Following this, the retailer is said to be looking for future expansion across the UK.

The retailer claims to be 30% cheaper than Aldi and Lidl and operates a hard discount model with no marketing, and few staff. Stores will have around 1,200 SKUs. JFT Mega Discount Warehouse is opening a new format. It currently has 12 outlets on retail parks in the Midlands and the north of England.

The warehouse and online business currently sells a wide range of products including food & drink, health & beauty, garden, and DIY products. Customers have to sign up to a free membership scheme to shop in its warehouses. Its new format will be called JFT Central, and it will be another value-based variety store.

The retailer has said it is looking to open at least 50 stores, according to The Times. It will be run by Jeremy Coombes, a corporate financier with experience in lending to small and medium-sized enterprises. He said that the market was full of opportunity because of low-rent deals currently on offer as landlords were desperate to fill empty units.

The first opening is set to be in Hull in a former Mothercare store. We do not currently know the opening date.

Final thoughts

Going forwards the discount retailers will need to find more ways to remain relevant in the changing environment. With retailers such as Tesco and Sainsbury's offering price matches to Aldi, the low price differentiator is not as strong as before.

Expect more development in the channel as the retailers look to satisfy the rising demand for online, and different shopping missions. 

Looking for more insight?

Discount newsletter

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Coupons & Offers

Discount retailer The Works sees sales tumble as an online boom is not enough to make up for lost business at closed stores

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Discount retailer The Works saw revenues tumble by a fifth over the past year as rising online sales did not make up for lost business due to store closures.

The chain, which sells craft supplies, gifts, books, toys and games and stationery, saw a 121 per cent boom in online sales in the year to May. 

But total sales still fell 19 per cent to GBP206.2million in the period, with the drop driven purely by the physical shops, which were closed for more than a third of the time.

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The Works has 527 stores in the UK and Ireland.

The majority have now reopened, except in the Republic of Ireland, where they are set to welcome shoppers again on Monday next week.

But stores have been closed for long periods.

For the 16 of the 53 weeks to the start of May all of The Works' shops were closed due to lockdowns, and more than 75 per cent of its estate was forced to shut for an additional eight weeks.

Chief executive Gavin Peck said: 'Like many retailers, the last 12 months have been incredibly challenging for The Works, which has historically relied mainly on in-store sales. 

'Our business was severely impacted by successive lockdowns and forced closures of our entire store estate.'

Since the stores reopened, they have performed well, although the company remained cautious.

'It is probably too soon to judge the extent to which these encouraging sales reflect strong underlying performance as opposed to pent up demand,' it said.

Meanwhile, online sales have reduced since stores reopened, although they are still 'significantly ahead' of their pre-Covid levels. 

The Works said it wouldn't yet give a profit guidance due to persisting uncertainty but was 'confident' in the future prospects of the business due to its 'strong financial position' and 'appeal of its proposition'. 

'Since we couldn't control store closures we focused on the things we could, keeping tight control of costs, optimising our operations and vastly improving our online offering,' Peck said.

'As a result, our financial position remained strong, online growth exceeded our expectations, and when stores reopened we saw customer demand returning quickly to pre-Covid levels.'

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Discount retailer The Works sees sales tumble as an online boom is not enough to make up for lost business at closed stores

(C) Provided by This Is Money MailOnline logo

Discount retailer The Works saw revenues tumble by a fifth over the past year as rising online sales did not make up for lost business due to store closures.

The chain, which sells craft supplies, gifts, books, toys and games and stationery, saw a 121 per cent boom in online sales in the year to May. 

But total sales still fell 19 per cent to GBP206.2million in the period, with the drop driven purely by the physical shops, which were closed for more than a third of the time.

(C) Provided by This Is Money (

The Works has 527 stores in the UK and Ireland.

The majority have now reopened, except in the Republic of Ireland, where they are set to welcome shoppers again on Monday next week.

But stores have been closed for long periods.

For the 16 of the 53 weeks to the start of May all of The Works' shops were closed due to lockdowns, and more than 75 per cent of its estate was forced to shut for an additional eight weeks.

Chief executive Gavin Peck said: 'Like many retailers, the last 12 months have been incredibly challenging for The Works, which has historically relied mainly on in-store sales. 

'Our business was severely impacted by successive lockdowns and forced closures of our entire store estate.'

Since the stores reopened, they have performed well, although the company remained cautious.

'It is probably too soon to judge the extent to which these encouraging sales reflect strong underlying performance as opposed to pent up demand,' it said.

Meanwhile, online sales have reduced since stores reopened, although they are still 'significantly ahead' of their pre-Covid levels. 

The Works said it wouldn't yet give a profit guidance due to persisting uncertainty but was 'confident' in the future prospects of the business due to its 'strong financial position' and 'appeal of its proposition'. 

'Since we couldn't control store closures we focused on the things we could, keeping tight control of costs, optimising our operations and vastly improving our online offering,' Peck said.

'As a result, our financial position remained strong, online growth exceeded our expectations, and when stores reopened we saw customer demand returning quickly to pre-Covid levels.'

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City Snapshot: Pepco offers share at a discount in upcoming €5bn IPO

Poundland Worthing Top story Poundland owner Pepco is has set its price in the upcoming Polish IPO at a discount, valuing the budget retail chain at £5bn (GBP4.3bn).

Steinhoff, the South African parent company of Pepco, set the price of shares in the flotation at 40 zlotys a piece (EUR8.82). It puts the offer at the lower end of the range of 38 zlotys (EUR8.32) and 46 zlotys (EUR10.08), guided by the group earlier this month. Pepco will look to raise about EUR700m from the sale of more than 80 million existing shares in the IPO, but has room to sell up to 92.5 million if demand allows.

The discounter also sold a further 23 million shares to its lenders to raise additional funds of EUR200m. The free float will total 20.1% on admission to public markets, which is expected to be on 26 May. Pepco revealed last month it had opted to list on the Warsaw Stock Exchange rather than in London given its exposure to the Polish market.

The group, which operates as Pepco, Poundland and Dealz, has more then 3,200 stores located across 16 countries. Pepco CEO Andy Bond said: "We are proud to be joining the Warsaw Stock Exchange in what will be its biggest IPO to date in 2021 and to become one of the largest listed companies in Warsaw. Our group operates in the attractive European discount retail sector, and with our three market-leading brands - Pepco, Dealz and Poundland - we are extremely well positioned to take advantage of the enormous growth opportunities in front of us.

"We are pleased to have received strong interest and support from a broad range of high-quality international and Polish investors, including substantial retail demand, who have all recognised the quality of our financial track record and the substantial, long-term store growth opportunity that we can readily finance through our internally generated cash-flow." Morning update Elsewhere on The Grocer this morning, there are two stories about upcoming M&A in the industry.

Fresh from completing a EUR1.7bn buyout of Valeo, Bain Capital is leading the chase for Wagon Wheels and Jammie Dodgers maker Burton's Biscuits. The Boston-based private equity firm is among the final group of interested parties in the auction led by Stamford Partners, along with Biscuit International and Fox's owner Ferrero. Read the full story on thegrocer.co.uk here.

The auction for Gu Puds is also drawing to a conclusion, with PE firm Exponent close to completing a GBP150m deal. Former Quorn owner Exponent has a long history in the consumer space and currently holds dairy supplier Meadow Foods, East Asian food platform Vibrant Foods and snacks brands Proper and Eat Real. The PE firm has been a strong contender since the Gu auction, handled by corporate finance firm Spayne Lindsay, kicked off late last year.

Read the story here. The FTSE 100 has mounted a recovery once again to climb back above 7,000pts this morning. It is currently up 0.8% to 7,019.22pts.

Shares on the up this morning include, Greencore, rising 2.8% to 167.5p, Kerry Group, up 2.4% to EUR109.30, SSP Group, climbing 2.1% to 315.2p, and Pepco owner Steinhoff, which was up 2.1%. Earlier fallers include Delivery Hero, Bakkavor Group, Hellfresh and Danone. Yesterday in the City

The FTSE 100 suffered a 0.6% loss down to 6,963.33pts as inflation fears continued to stalk the market. There was little in the way of company news to influence food and drink shares yesterday, but many in the industry escaped the general negative investor sentiment. Kerry Group, CC&C Group, Deliveroo and M&S, led the fallers, down 2.3% to EUR106.70, 2.3% to 285p, 2.2% to 238.4p and 0.8% to 151.3p respectively.

The risers included McColl's Retail Group, up 3.2% to 36p, Stock Spirits Group, up 2.8% to 275.5p, AG Barr, up 1.4% to 522p, and Bakkavor, up 1.6% to 131.4p.

Ocado, Pets at Home, Premier Foods, Reckitt Benckiser, Unilever, Greggs, Hotel Chocolat, Hilton Food Group and Fevertree also escaped the gloom.

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UK’s rarest cars: 1969 Gaz M21 Volga, a Russian rarity with a hint of Cold War menace

In the 1960s the average Briton was most likely to see a black M21 Volga in a Cold War drama than parked outside Woolworths, but for many citizens of the former USSR it was an object of desire. Kiril Vitanov's 1969 example is an undoubtedly imposing sight, exuding authority - and faint menace - from almost every angle. GAZ (an abbreviation of Gorkovsky Avtomobilniy Zavod, or Gorky Automobile Factory) developed the Volga as a showcase for Soviet engineering.

Power was from an all-aluminium, 2,445cc four-cylinder engine while the attractive bodywork had faint overtones of early 1950s Detroit. The manufacturer had acquired several US-produced models during the M21's planning stages, and Vitanov notes that his example is mistaken for an American car on occasion.  In May 1955 the was Volga extensively publicised via a test-run of nearly 5,300 miles from Moscow to the Crimea and back.

Some foreign competitors accompanied a trio of M21s, and Ogoniok magazine happily reported a Standard Vanguard collapsing under duress. Full production commenced in 1956, although a price of 5,400 roubles was far beyond the average citizen.

UK's rarest cars feature at The Classic at Silverstone this summer

The Volga was updated in 1958 as the Series 2, and the 1962 Series 3 was also available as an M22 Universal estate car. Four years later several M21s starred in the acclaimed comedy film Beregis Avtomobilya/Beware of the Car.

Manufacture ceased on 15 July 1970 after 639,478 units had been produced, a third of which were exported. One of the Volga's principal roles was to earn Western currency, and GAZ sold it in 43 countries - including the UK. Imports commenced in 1959 when the M21 caused a minor stir at the London Motor Show.

The concessionaire Thomson and Taylor assured British motorists that it "was "built for a lifetime of hard work" and "Volga do not subscribe to the idea of obsolescence".

The Volga is often mistaken for an American car of the Fifties 

In 1960 the M21 cost GBP1,113 4s 2d which represented excellent value for a six-seater fitted with a radio, a reclining front bench and even a hand-throttle. There was also a starting handle and a 35-piece toolkit, as befitting a car developed in a country with very few service stations. The British motoring press seemed rather taken with the Volga, Autocar stating "anyone who is of a mind to discount Russian design or workmanship would do well to think again". Motor thought the saloon offered "a high standard of smoothness, silence and comprehensive equipment" and was impressed by how the Universal estate version seemed oblivious to "mountain tracks, fields and pot-holed roads". 

The M21 seated six and was well equipped for the time, with a radio, a reclining front bench seat and even a hand-throttle

M21s were never a common sight in the UK, appealing mainly to free-thinking drivers who were not concerned by their neighbours reporting them to MI5.

By contrast, when Vitanov grew up in Bulgaria, they were familiar sights as taxis, ambulances, police cars or family transport. Black-liveried Volgas denoted officialdom: Vitanov says "they were the equivalent of the Mercedes S-Class of all countries behind the Iron Curtain, used only by the government and as an embassy car".   Vitanov craved an M21 since childhood as it was "the car driven by Yuri Gagarin".

He bought this example five years ago in Bulgaria - "the first owner waited eight years to take delivery" - and it now resides in Cambridge. 

There are believed to be fewer than 20 on the road in the UK and so "everyone stares when I drive it", says Vitanov. In terms of performance, "the Volga feels slow with only a three-speed transmission, but it is very comfortable and very big; a car built to make a statement". The public reaction to the M21 Volga is always highly positive. "People want to know the story behind it," says its owner.

Best of all, Vitanov finds that "driving the M21 in the streets of Cambridge, probably one of the most iconic cities in England, is more than a privilege. For me it is like the perfect match, like a time machine".  Or, as one passer-by once exclaimed: "I know that car - it is the legendary Russian Volga."

Thanks to: Kiril Vitanov

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New discounter Mere looking for landlords across the UK

Mere Preston New discount food retailer Mere is looking for landlords across the country as it plans its expansion in the UK. The Russian-founded chain, which The Grocer last week revealed was set to open its first four UK stores this summer, has published a wish list of further locations.

The business is appealing for landlords to contact it via its website. "We are looking for suitable locations across UK to expand our retail chain," the site says. "At the moment, despite coronavirus, we are actively involved with landlords, their representatives and agents with the aim to open our Mere retail stores ASAP." The locations listed are Devon, Stockport, Neath, Banbury, Selby, Bradford, Middlesbrough, Grantham, Kettering, Plymouth, Beckenham, Gloucester, Northampton, Cardiff, Oswestry, Barnsley, Sheffield, Exeter, Stretford, Southampton, south Scotland and Wales.

The discounter is looking for sites of around 10,000 sq ft, with parking spaces for 30-40 cars and a local population of 60,000 or more. Mere is already in talks with suppliers over its first four planned UK stores, with the first set to open in Preston next month. It is to be followed by a second site in the north of England, in Castleford, and two in Wales, in Mold and Caldicot.

The retailer trades as Svetofor in Russia, where it was founded in 2009. It has about 3,200 stores internationally and has been opening in Europe since 2018 under the name Mere, including in Germany, Poland, Romania, Lithuania, Latvia and Ukraine. As well as the UK, it plans to soon enter Italy, Spain, Greece and Bulgaria.

The company claims it will undercut existing UK discounters by 20%-30%, thanks to a no-frills model that sees suppliers deliver directly to stores and goods sold from pallets. Stores feature a walk-in chiller room, and only eight staff to keep costs down. The website also features a page looking for shopfitters, listing some of the prices paid, including GBP400 for "used freezers" and GBP50 for "shopping carts".

The appeal for UK landlords and shopfitters was spotted by Grocery Insight director Steve Dresser following The Grocer's story on Mere's UK plans last week. "Tight costings on the shop fitting," Dresser tweeted. "They certainly seem to know what they are doing in this regard. Best of British to them."

Mere UK head of buying Pavels Antonovs last week told The Grocer the chain would fill a "gap in the market" in the UK, with no competitors. Each store is to have a maximum of 1,200 SKUs, including ambient, chilled and frozen, but with no "fast perishable goods" such as bakery, the website says. Newspapers, magazines and "premium goods" will also be absent.

Tight costings on the shop fitting.

They certainly seem to know what they are doing in this regard.

Best of British to them. pic.twitter.com/009Xlyr4Pb

-- Steve Dresser (@dresserman) May 8, 2021

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New discounter Mere looking for landlords across the UK

Mere Preston chiller area New discount food retailer Mere is looking for landlords across the country as it plans its expansion in the UK. The Russian-founded chain, which The Grocer last week revealed was set to open its first four UK stores this summer, has published a wish list of further locations.

The business is appealing for landlords to contact it via its website. "We are looking for suitable locations across UK to expand our retail chain," the site says. "At the moment, despite coronavirus, we are actively involved with landlords, their representatives and agents with the aim to open our Mere retail stores ASAP." The locations listed are Devon, Stockport, Neath, Banbury, Selby, Bradford, Middlesbrough, Grantham, Kettering, Plymouth, Beckenham, Gloucester, Northampton, Cardiff, Oswestry, Barnsley, Sheffield, Exeter, Stretford, Southampton, south Scotland and Wales.

The discounter is looking for sites of around 10,000 sq ft, with parking spaces for 30-40 cars and a local population of 60,000 or more. Mere is already in talks with suppliers over its first four planned UK stores, with the first set to open in Preston next month. It is to be followed by a second site in the north of England, in Castleford, and two in Wales, in Mold and Caldicot.

The retailer trades as Svetofor in Russia, where it was founded in 2009. It has about 3,200 stores internationally and has been opening in Europe since 2018 under the name Mere, including in Germany, Poland, Romania, Lithuania, Latvia and Ukraine. As well as the UK, it plans to soon enter Italy, Spain, Greece and Bulgaria.

The company claims it will undercut existing UK discounters by 20%-30%, thanks to a no-frills model that sees suppliers deliver directly to stores and goods sold from pallets. Stores feature a walk-in chiller room, and only eight staff to keep costs down. The website also features a page looking for shopfitters, listing some of the prices paid, including GBP400 for "used freezers" and GBP50 for "shopping carts".

The appeal for UK landlords and shopfitters was spotted by Grocery Insight director Steve Dresser following The Grocer's story on Mere's UK plans last week. "Tight costings on the shop fitting," Dresser tweeted. "They certainly seem to know what they are doing in this regard. Best of British to them."

Mere UK head of buying Pavels Antonovs last week told The Grocer the chain would fill a "gap in the market" in the UK, with no competitors. Each store is to have a maximum of 1,200 SKUs, including ambient, chilled and frozen, but with no "fast perishable goods" such as bakery, the website says. Newspapers, magazines and "premium goods" will also be absent.

Tight costings on the shop fitting.

They certainly seem to know what they are doing in this regard.

Best of British to them. pic.twitter.com/009Xlyr4Pb

-- Steve Dresser (@dresserman) May 8, 2021

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Russia’s answer to Lidl and Aldi to open branches in UK

A Russian discount supermarket chain which is the country's answer to Lidl and Aldi is to open branches in the UK. Svetofor, which trades as Mere in Europe, first opened in Siberia in 2009 and claims to be even cheaper than the German discount chains. Svetofor says groceries it sells are up to 30% less than other shops like Ald or Lidl.

The Russian chain currently has 3,200 stores and opened its first European Mere branch in 2018. It already has shops in Germany, Poland, Romania, Lithuania, Latvia and the Ukraine.

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It is reported to be ready to open its first UK branch next month - at a former Nisa in Preston. A further three shops are also planned - including two in Wales, in Mold and Caldicot, and another in Castleford in the north of England.

Speaking to trade magazine The Grocer, Pavels Antonovs said Mere prices will undercut even the cheapest supermarkets. Mr Antonovs said: "We are the gap in the market. We don't have any competitors.

Our model is no service and no marketing." Mere stores are expected to double up as warehouses, with images from other sites across Europe showing items displayed on palettes. As well as fresh food, Mere shops across Europe also have chilled and frozen ranges.

Each store in the UK will have around 1,200 items and just eight staff.

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Russian supermarket claiming to be cheaper than rivals opening in UK

Putin Aldi and Lidl out of business? Russian budget supermarket chain Svetofor that claims to be a THIRD cheaper than rivals is opening in UK

  • Svetofor, named Mere in Europe, reported to be opening first planned UK store
  • The retail chain says it costs up to 30% less than nation's cheapest supermarkets
  • First store to open in Preston, with additional two in Wales and one in Castleford
  • Founded in 2009, chain has 3.2k stores globally and expanded to Europe in 2018

By Katie Weston For Mailonline

Published: 18:48, 7 May 2021 | Updated: 19:06, 7 May 2021

A Russian budget supermarket chain that claims to be a third cheaper than rivals such as Aldi and Lidl is opening in the UK.

Svetofor, which operates under the name Mere in Europe, says it costs up to 30 per cent less then the nation's cheapest supermarkets.

The company is reported to be opening its first planned store in the UK at a former Nisa branch in Preston, Lancashire.

An additional three stores are also being planned - two in Wales, namely Mold and Caldicot, alongside one in Castleford, West Yorkshire.

Svetofor, which operates under the name Mere in Europe, says it costs up to 30 per cent less then the nation's cheapest supermarkets (pictured: a Mere store)

Svetofor, which operates under the name Mere in Europe, says it costs up to 30 per cent less then the nation's cheapest supermarkets (pictured: a Mere store)

Mere UK head of buying, Pavels Antonovs, told The Grocer: 'We are the gap in the market. We don't have any competitors. 

'Our model is no service and no marketing.'

On its UK website, Mere states it is looking for suitable locations across the nation to expand its retail chain.

It says: 'At the moment, despite coronavirus, we are actively involved with landlords, their representatives and agents with the aim to open our MERE retail stores ASAP.'

The business then lists locations of interest including South Scotland, Devon, Cardiff, Southampton, Stockport, Neath, Banbury, Selby, Bradford, Grantham, Kettering, Gloucester and Sheffield.

A description on the site, which does not yet reveal the price of its products, also says: 'We are a fast-growing, ambitious team that is currently working intensively on the future of the company.

'Our profile is the retail chain in the food sector that offers its customers good goods for little money. We work according to the motto "only lowest prices every day".'

The chain adds that its goals are 'satisfying customers through our best price-performance ratios' as well as 'fair, sustainable and long-term cooperation with producers, suppliers and service providers.'

Each store in the UK is estimated to have up to 1,200 products and only eight staff, counting a director, four cashiers and three delivery workers

Each store in the UK is estimated to have up to 1,200 products and only eight staff, counting a director, four cashiers and three delivery workers

The warehouse-styled branches will be approximately 10,000 sq ft with suppliers expected to deliver straight to the stores

The warehouse-styled branches will be approximately 10,000 sq ft with suppliers expected to deliver straight to the stores

Each store in the UK is estimated to have up to 1,200 products and only eight staff, counting a director, four cashiers and three delivery workers.

The warehouse-styled branches will be approximately 10,000 sq ft with suppliers expected to deliver straight to the stores.

Founded in Siberia in 2009, the business has 3,200 stores globally and expanded to Europe in 2018, opening in Germany, Poland, Lithuania, Romania, Latvia and Ukraine.

The announcement follows Lidl narrowly beating Aldi as the cheapest supermarket of 2020 with Waitrose coming in as the most expensive, according to a study.

Researchers tracked the price of 45 popular products such as Hovis bread, Knorr stock cubes and free-range eggs in eight major supermarkets for at least 100 days between January and December last year.

The average price of each item over the year and the total average cost of all 45 items in the 'trolley' - taking the weight and quality of items into account - was calculated by consumer group Which? 

The chain said: 'At the moment, despite coronavirus, we are actively involved with landlords, their representatives and agents with the aim to open our MERE retail stores ASAP'

The chain said: 'At the moment, despite coronavirus, we are actively involved with landlords, their representatives and agents with the aim to open our MERE retail stores ASAP'

Lidl was the cheapest supermarket in the study, with the basket costing GBP42.67 on average.

Just 34p put Lidl ahead of its discount chain rival Aldi, with the latter's basket of items costing an average of GBP43.01.

Asda was the third-cheapest supermarket with the same basket of items costing GBP48.71 on average - a difference of more than GBP5 when compared with Aldi or Lidl.

Waitrose was the most expensive supermarket in the study.

The average cost of the 45 items was GBP68.69 - around 60 per cent or GBP26.02 more than a similar shop at Lidl.

However, Aldi was named as the cheapest supermarket in a more recent study by the same consumer group, which compared the cost of 20 essential items in each of Britain's biggest supermarket chains in April.

The list includes branded items such as Cadbury Dairy Milk and Heinz Beanz, as well as own brand items such as onions, chicken drumsticks and milk.

The basket total at Aldi was found to be GBP8 less than Waitrose, which was priced up at GBP30.89. 

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