On the first anniversary of Costcutter’s buy and supply deal with P&H, CEO Darcy Willson-Rymer has conceded that “not everything is working properly” but insists the group is on the right track and recruitment is at a record high - while retailers remain fiercely divided over the quality of service.
Following the transition to BuyCo in July 2014, the first few months were characterised by missed deliveries and poor product availability, with a number of high-profile Costcutter retailers switching to Nisa in frustration. One year on, most Costcutter retailers contacted by C-Store agreed that deliveries had improved significantly, but in other areas their experiences were mixed.
Willson-Rymer told C-Store that the “opportunity for failure was greater, given the 12-depot network, but it enables us to keep the prices lower with shorter road miles.” There had also been big improvements in deliveries, he added. “There are areas where we need to continually evolve and improve, but we’re in a far better place than we were two years ago. Everything’s in our control now - and recruitment has never been stronger. Our pipeline is full.” he said.
Sat Deo, who owns three Costcutter stores in Yorkshire, said “everything” had improved. “Availability is good and delivery is getting more punctual, margins are up about 2-3% in all stores,” he added. “More people are getting used to the Independent range, too - and the new ad will help.”
Sue Nithyanadan, of Costcutter Epsom, Surrey, was also upbeat. “It’s gone better than expected, I’m quite optimistic,” she said. “The range isn’t as good as Nisa’s, but it’s getting better. The Independent range is really popular - the humus is outselling the Delphi variant.”
Willson-Rymer said the Independent range had grown 50% in the year to date.
Sue added that P&H lorries were smaller and more manageable than Nisa lorries “which were getting bigger and bigger”.
But Nicholas Kelly, of MyCostcutter Insch in Aberdeenshire, said deliveries alone had improved. “In all other areas (range, pricing, margins, promotions, availability, date codes, quality of fresh foods, own label) there has been a significant step backwards,” he added.
“P&H were good at delivering a small range of products to predominantly CTNs. But they simply can’t cope with the huge increase in range and the huge increase in retailer numbers that has resulted from teaming up with Costcutter.”
Willson-Rymer admitted there was work to be done on range in large stores. “It’s about taking the system we built and optimising it,” he said.
Another retailer, who wished to remain anonymous, is in the process of moving to Nisa. “I have to go to a local supplier for products in fruit and veg, toiletries, pet food and dairy. Some key products aren’t in the Independent range, and promotions are repetitive and inconsistently priced,” he said.
“Also, I haven’t had physical support from Costcutter employees. I haven’t seen my area manager for about three months.”