SuperValu staying firmly with community focus

Individual owners are better able to identify and react to fads thanmanagers. Ed Power reports.

Individual owners are better able to identify and react to fads thanmanagers.Ed Power reports.

Talk of a consumer revolution does not impress Mr Michael Nason. The managing director of SuperValu-Centra retail group says claims that Irish eating habits have altered dramatically over recent decades are exaggerated. Changes that did occur during the recently departed Celtic tiger years - a trend towards eating out and "instant" meals - reversed once the economy started to cool.

And he disagrees vehemently with market research predicting the demise of the traditional "weekly shop" - an institution he feels is unfairly maligned as an antediluvian hangover from an Ireland best forgotten.

Mr Nason's conviction that Irish consumers are shopping in much the same way as previous generations is unshakeable. As the head of the SuperValu-Centra empire, holder of the second-largest slice of an increasingly competitive market, he says he is uniquely placed to identify emerging trends as well as those that have been dangerously over stressed.

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Unlike many of their competitors, SuperValu and Centra outlets are sole traders tied to the Musgrave wholesale network. Individual owners are better able to identify and react to fads than store managers, says Mr Nason. Owners are more vigilant because they are the ones who will suffer in the first instance should they misjudge consumer needs.

He argues that it is this ability to empathise with shoppers that has sustained the SuperValu brand in particular, as it has grown over the past 23 years from a handful of stores clustered in the Munster region to a chain that is nearly 200 branches strong.

Hemmed in by Tesco and Dunnes Stores on one side and German discounters Aldi and Lidl on the other, SuperValu has worked hard to carve a distinctive niche. As economies of scale make it difficult to undercut multinational rivals, the chain has pitched itself at the upper end of the market, laying emphasis on quality of service.

A unique insight into Irish shopping habits has helped it stay ahead of the curve says Mr Nason.

"There is a perception that shopping is a chore, something that you want to get over and done with as quickly as possible," he explains. "But our experience - as told by our store owners - is sometimes very different. We find that some people - a housewife or older person say - actually enjoys shopping. It's our job to augment that experience, to look at ways of making it as satisfying as possible."

SuperValu makes no secret of its desire to become a bigger player. Up to 10 new stores are planned this year, including a flagship foodhall on Dublin's Aston Quay.

Turnover, which climbed 9 per cent to €1.55 billion last year, is predicted to rise by at least €70 million in 2003, although profitability is more difficult to gauge as the group does not break out these figures.

Perhaps most significantly, the chain has dramatically revamped its own-brand range - worth €165 million last year. At its annual conference in Killarney this week, Musgrave unveiled plans for dozens of new, premium-quality products over coming months.

But pragmatism tempers Mr Nason's ambition. The group's strength is rooted in its affinity with the community. Get too obsessed with the bigger picture and it risks losing sight of its responsibility towards customers.

Despite intense competition in the retail sector, Mr Nason believes SuperValu is still some distance from saturation point. The growth of commuter towns around Dublin offers potential for expansion.

Musgrave insists it wants to stay away from the coal face. Abiding by the maxim "if it ain't broke, don't fix it", the company says stores are best overseen by individuals rooted in the community. It manages several recently acquired outlets in Northern Ireland but is keen to see them pass into independent ownership as quickly as possible.

A key priority this year is the expansion and augmentation of existing stores, helping them to rebuff more firmly the seemingly inexorable roll-out of Aldis and Lidls across the State. Many branches are embarking on ambitious - and costly - overhauls or relocating to greenfield sites in response to customer demands for better parking facilities.

Mr Nason believes leaving the day-to-day running of stores to individual owners gives SuperValu a competitive edge. Owners may have to work harder than managers but, he feels, the rewards are many times greater.

SuperValu posted record turnover last year but Mr Nason is reluctant to talk up its achievements.

Complacency must be avoided, he cautions. The SuperValu brand may be recognised increasingly as a seal of quality and as a committed purchaser of Irish goods, but that counts for little if the chain loses sight of its goals or sells itself short by allowing standards to slip.

"If a store owner takes his or her eye off the ball - he doesn't just answer to Musgrave but too all the other store owners," he says.