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Last Updated: Friday, 20 May, 2005, 11:52 GMT 12:52 UK
Independent corner shops decline
Corner shop shelves
Independent stores are teaming up with larger groups
The number of independent corner shops in the UK is on the wane as more stores link up with larger retailers, a report by retail think tank IDG suggested.

Independent store numbers fell by 7% in the last year while sales fell 5%, IDG found. The UK convenience store sector is worth 23.9bn.

In contrast, sales at convenience store formats owned by supermarkets - such as Tesco Metro - shot up by 18%.

Despite the fall, independents still account for half of all corner shops.

Buying power

The report also said that a growing number of independent stores had either closed or affiliated themselves with specialist convenience store operators such as Spar or Costcutter.

Such alliances allow them to improve their buying power and increase spending on marketing.

Sainsbury's and Tesco are both targeting the convenience sector as an area they want to grow
Rhys Williams, Seymour Pierce

These stores - known in the industry as 'symbols' - now account for 23% of all store numbers and almost a third of convenience sector sales.

"Some of them are doing very well on their own," an IGD spokeswoman told the Press Association.

"'Symbols' can give them some of the support and advice that they don't have so they can draw on the knowledge of these established groups."

Big brands

Retail experts said the rising closure rate of independent stores was no surprise given the intense competition in the market.

The leading supermarkets have been developing their mini-store formats at a rapid pace in the past few years, led by Tesco and Sainsbury's who have been buying up smaller sites.

Tesco metro store
Tesco and other supermarkets are eating into the convenience market

"Sainsbury's and Tesco are both targeting the convenience sector as an area they want to grow," said Rhys Williams, an analyst with stockbrokers Seymour Pierce.

"It means that independent stores trading against them can't compete and then they close."

The convenience sector outperformed the grocery market as a whole in 2004, seeing 5% growth., with half of all shoppers still visiting corner shops at least two times a week.


SEE ALSO:
Profits collapse at Sainsbury's
18 May 05 |  Business
Co-op joins Somerfield bid fray
06 May 05 |  Business
Food store to buy forecourt units
17 Feb 05 |  Bristol/Somerset
M&S denies food store sale plan
29 Nov 04 |  Business
Tesco gets more convenient
30 Oct 02 |  Business
Support your local corner shop?
27 Aug 03 |  Magazine


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