Morrisons to trial convenience stores and test online shopping

Morrisons says it is performing “better than ever” and will move into small format stores next year.

The news comes as the supermarket chain reports a sales increase of 9.1% to £8.1bn for the half year to 1 August.

Morrisons reported a 0.9% rise in like-for-like sales during the period and the supermarket says it now serves 800,000 customers each week.

Underlying profit before tax increased 14% to £410m.

The supermarket chain says it will trial smaller format convenience stores from 2011.

The chain also says an assessment of internet grocery is under way suggesting that the supermarket may introduce online shopping at a later date.

A move into online grocery has been much speculated since Dalton Philips took over as CEO at the start of the year but

Neil Saunders, consulting director of Verdict, says: “Morrisons is right to take its time to investigate this area and find the right model. With the good growth numbers they’re showing there is really no need to rush headlong into the internet grocery market.”

Morrisons has built its business around fresh produce and is the only major UK supermarket that to slaughter its own meat and produce its own cheese, bacon and sausages, and says it will invest more in food production to further drive its point of difference between rivals Asda, Tesco and Sainsbury’s.

Philips says: “There are many opportunities ahead to drive our top line, increase efficiencies in the business and to capture growth. Today we are outlining plans to build on our strengths and generate profitable growth.”

Saunders adds that as most of Morrisons’ growth is coming from new stores it must look to improve like for like figures and there is a “huge opportunity” for Morrisons to grow sales and share though convenience retailing.

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