Morrisons ousts The Co-op in wine supply deal

UK retailer Morrisons has signed a deal to supply wines to convenience retailer McColls, ousting The Co-op who trialled supplying the newsagents earlier this year.

The Co-op started a three-month trial supplying wine, fresh and ambient grocery to 25 McColl stores in May, with a view to extending the trial in a bid to “get more Co-op products into more people’s baskets” without opening more stores.

However it was announced today that Morrisons would be taking on the long-term supply for McColl’s estate of 1,300 convenience stores and 350 newsagents following “a competitive process”.

The grocer has resurrected the Safeway name for the wholesale deal but it will also supply some branded lines, a statement said. db understands the wine range has been in development for a year, however a spokesman for the retailer told db it was too early to say anything about the wines that McColls would stock, or the brands they would be under.

Chief executive of Morrisons David Potts said the new partnership was an example of how Morrisons was leveraging its existing assets to access the UK’s growing convenience food market in a capital light way.

“Wholesale supply will help make us a broader, stronger business,” he said.

Jonathan Miller, chief executive of McColl’s added that the convenience business was gaining access to “best-in-class sourcing and manufacturing capabilities” through the long-term partnership, which would provide an enhanced range and advance McColl’s credentials.

“This is a defining moment for McColl’s and builds on the transformational deal we announced last year to acquire 298 high quality convenience stores,” he said.

A phased roll-out will start in January.

The new deal is part of Morrisons’ new strategy to broaden its offer, after it announced a wholesale supply deal with online giant Amazon last February, a move also described as a “capital-light” investment that effectively extended the reach of its products.

Prior to the Co-op trial, McColls’ wine, fresh food and grocery was supplied by Nisa and Palmer & Harvey.