Peter Marks, group chief executive at The Co-operative Group, told delegates at the 2011 IGD Convention he had never seen customers squeezed as much as now.
“I’ve worked though a number of recessions but this feels worse than others – the length of time it is taking to come out the other side is different,” he said.
Marks said food sales volumes, which are typically constant, are now falling and government was running out of economic levers to pull.
“We are having to grit our teeth,” he said, and called for growth as well as austerity measures.
Marks said the Somerfield acquisition was the best deal the Group has ever made and, while integrating the business at the same time as the economy was in recession was almost a ‘perfect storm’; it had created value and helped modernise the business.
Marks admitted four to five years ago the Co-operative Movement was in significant decline. “It did not co-operate and it did not move,” he quipped. Investment now is for the long term and the retailer is on a journey of transformation, he said.
On ethical trading, Marks said the Co-operative was a leader but it could not be a usp and he wanted everybody to embrace Fairtrade, for example, to ensure farmers prosper.
Marks predicted the next breakthrough in retail would be mobile technology.
“Tomorrow’s customer is going to be far more informed about products and services than they are today,” he said.
Marks said the company also had its eye on innovation, such as selling online. He said people would increasingly go online to order bulky products from larger retailers but when those stores ran out, its branches would be able to supply pick ups.
Marks said he expected retailers to come out of recession in better shape. “One thing recession does do, is make you look at yourself,” he said.