Costcutter and Mace retailers have welcomed the deal struck between Costcutter and Palmer & Harvey, although some concerns have been expressed over availability.
As part of the arrangement, P&H will supply to all Costcutter and Kwiksave sites for eight years, once its existing deal with Nisa ends on July 1, 2014.
Karl Rasmussen of Rasmussen’s Costcutter, Skegness, Lincolnshire, believes The Buyco will help retailers offer customers better value. “The deal seems to be a good thing, but it’s still early days,” he said. “Anything that will help us compete with the multiples can only be good, and it looks like we’ll have more control over promotions and be able to provide a wider variety of promotions. The new Independent own-label range will go down well with shoppers.”
Makhan Sunner of City Spices, Stourbridge, West Midlands, said the joint venture was “a very good deal”, while Andrew Gill, who owns three Costcutter stores in Cornwall, was impressed by P&H’s plans to handle the distribution of the combined estate. “Hopefully, it’ll mean lower costs and better delivery times, which is something that Nisa was struggling with,” he said. “I think it’ll be a positive step for Costcutter and our business.”
Mace retailers have cautiously welcomed the joint venture, but expressed concern over availability.
As part of the deal, Costcutter will take over the management of Palmer & Harvey’s 800 Mace, Supershop and Your Store stores.
Vip Panchmatia of Hexagon Stores in Andover, Hampshire, welcomed the experience that Costcutter will bring. “I’m looking at it very positively,” he said. “Costcutter has great retail experience that will really help Mace stores, and the partnership will make the buying group bigger. It’s the right balance and Palmer & Harvey will have a year to be able to supply the extra stores.”
Sally Read of Mace Bodicote in Banbury, Oxfordshire, is also looking forward to Costcutter’s input, but is worried that Palmer & Harvey may be stretching its distribution network too far. “Availability with Palmer & Harvey isn’t great as it is, and with an extra 1,700 stores to supply, it’ll only become more difficult,” she said.