Has the one-stop shop arrived; It's still possible to live without one . But can you exist, from cradle to grave, shopping only in a supermarket? From baby clothes to coffins, wedding dresses to houses and even jails, Paul Simpson looks at the literal sense in which Britain's supermarkets are becoming one-stop shops

Grocer,  April 28, 2007  by Paul Simpson

• E-mail
• Print
• Link

Think of almost any human activity and a supermarket can sell you something to help. Need to go to a nursery? Drop the kids off at Sainsbury's in Castle Point, Bournemouth, where they can learn while you shop. Left school without enough qualifications? Through the power of Tesco Clubcard you can get discounts on your Open University course. Fretting about the cost of your nuptial gig? You can buy a wedding dress and a diamond ring from Asda and still have change from 900 [pounds sterling]. Want to get on the property ladder? Visit the Homes in Asda website.

For years supermarkets have been claiming to be one-stop shops, but now it seems these boasts have finally become reality. From cradle to grave, if you need it, a supermarket somewhere will sell it.

In certain parts of the US, for example, your family can buy your coffin at a local discount store. But even if you just fall ill you can, in many US cities, get treated at the in store clinic. Now Asda is planning to become the first UK supermarket to open after-hours GP surgeries in its stores across Britain.

To some, this approach smacks of commercial totalitarianism. But take a step back from the media furore--which often stereotypes Tesco magnate Sir Terry Leahy as a Bond villain--and diversification makes sense for both supermarkets and consumers.

If you believe opinion polls, newspaper columns and the growing band of websites launched by activists, supermarkets in Britain are slightly less popular than Jade Goody. But one of the paradoxes of modern capitalism is that we have more rights as consumers than we do as voters. If Sir Terry volunteered Tesco to run the Home Office, we'd probably be relieved. After all, Tesco has a reasonable record of delivering on its promises.

So for a silent, slightly guilty majority, the idea of living entirely on stuff from our local supermarket is comforting. If we trust the retailer, we're happy to buy different stuff from them. Tesco, for example, has five million personal finance customers (and makes a cool 200m [pounds sterling] from them).

Supermarkets sell an expanding portfolio of products, ranging from insurance to golf driving nets, from mortgages to power drills. The number of items varies from about 20,000 in standard stores to 100,000 in a hypermarket.

In fact, the nation's trust in its supermarkets may explain why the government is keen for stores to house doctors' surgeries and even prison cells to confine yobs until the police (who, in parts of London, do some basic training in supermarket aisles) can drop in.

And under pilot schemes, if you're a crime victim, you will soon be reporting it to a bobby based in your supermarket.

There is a catch, though. You can buy almost anything from a supermarket as long as it's popular. If you're one of the few remaining people in the UK yet to read The Da Vinci Code, you can still snap it up at a bargain price. But you won't find a biography of Leonardo da Vinci. The same stultifying principle applies, in varying degrees, to CDs, DVDs and magazines.

The bad news for those, like TV chef Hugh Fearnley-Whittingstall who see supermarkets as a threat to society as we know it, is that this diversification isn't going to stop.

"The trend took off in the late 1990s, picking up pace in 2000 onwards," says Richard Dodd at the British Retail Consortium. "The maturity of the food market and price competition between multiples resulted in thinning margins in many areas. While supermarkets encouraged customers to spend more by trading up to premium products, the lack of margin on food is one factor motivating their move into non-food."

With supermarkets taking 72% of the 76bn [pounds sterling] Britons spend on their groceries ever year, they have had to diversify to grow. Sales of major non-food categories through grocery multiples increased by 61% between 2000 and 2004 to reach a value of 12.8bn [pounds sterling], says Dodd.

David Gordon, director of UK research at IGD, points out that this growth has been driven, in part, by stores launching their own dedicated non-food formats such as Asda's George clothing range and general merchandise brands such as Asda Living, which was launched in 2004, and Tesco Homeplus, which opened in 2005.

Asda's move into jewellery--it sold cut-price replicas of the wedding ring Camilla wore when she married Prince Charles--is a sign of how fast supermarkets can respond. "Asda monitored consumer spending and discovered a 42% increase in household spending on jewellery between 2000 and 2004," says Dodd. "So it installed jewellery counters in the George areas at its stores."

Retailers use different strategies to drive diversification (see box). Some have stuck closely to a food base. Others--especially Tesco and Asda--have created stores with such a wide product range they have become destinations in their own right. Some destination stores devote only half their space to food. Sainsbury's has so far chosen a third way, selling complementary nonfood items.