Sainsbury's rolls out Smart Shops amid slowdown in grocery sales

Sainsbury's expects to roll out 45 Smart Shops in stores by the end of next week as the brand continues to drive down costs amid competition from discounters.

Sainsbury's rolls out Smart Shops amid slowdown in grocery sales

Last month, Sainsbury’s revealed plans to axe up to 2,000 jobs as part of efforts to cut £500m in costs as it competes with discounters Aldi and Lidl. 

Today the supermarket giant reported a slowdown in like-for-like grocery sales to 1.4% for the second quarter of 2017, down from 3% in the first quarter.

Total group sales, including Argos but excluding fuel, also slowed to 0.6% for the second quarter, down from 2.3% in the previous three months. 

Sainsbury’s said it had improved its offer across 15% of supermarkets during the first half of the year, including 112 Argos stores within Sainsbury’s supermarkets. 

Smart Shop, the brand's new service that enables customers to scan their shopping with a handset or mobile phone at a checkout, will be available in 45 stores by mid-November, the company reported today.

The supermarket giant has also completed a checkout-free shopping trial in London Euston in September with further trials planned.

Chief executive Mike Coupe said the brand was continuing its focus on offering customers "great value", supported by its removal of multibuys.

"Customers can shop at Sainsbury's knowing they get good value every day without having to wait for products to be on promotion. We are also collaborating with suppliers and working hard within our own business to reduce our costs and limit the impact of price inflation on our customers," Coupe said.

Underlying profit before tax was down 9% to £251m for the first six months of 2017, which Sainsbury’s said reflects previously guided price investment, wage cost inflation and consolidation of Argos losses which were partly offset by synergies and cost savings.

However, online grocery shopping and convenience sales grew "strongly", by 7% and 8% respectively.

General merchandise and clothing both outperformed the market and grew market share, Coupe added in this morning's trading update.

Coupe said today: "We have delivered a good performance across the group in the last six months, with more customers choosing to shop at Sainsbury's in the first half than ever before. We are now three years into delivering our differentiated strategy and are seeing clear results.

"We are adapting to meet customers' changing shopping habits and, as a result, we are seeing positive momentum across the business."

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