Gyles Walker, Co-op: Back to Business Q&A

By Lisa Riley

Published: 27 August, 2020

As the trade measures up to extraordinary times and swings through summer, leading businesses and operators take stock of trading conditions in the new normal.

Gyles Walker, category buying manager for wine at the Co-op, continues our series with insights into the biggest changes and challenges.

How is the business performing and what are sales like compared with pre-lockdown?

At Co-op, we have delivered six years of consecutive growth and recent Kantar figures show we have the highest market share for nearly 20 years. The wine category is one of the biggest drivers of this growth and we continue to overtrade with a 10% market share. The beers, wines and spirits performance within Co-op is currently incredibly strong as customers are choosing to shop locally.

What are the biggest changes and challenges in adjusting to the ‘new norm’?

As a convenience retailer we had to respond quickly to customer changing from a high frequency, small basket purchases to lower frequency, bigger basket shopper mission. Our frontline store colleagues have been amazing, at the forefront of servicing and meeting the changing expectations of our customers in these uncertain times.

The most significant impact across the whole alcohol industry has been on beer and cider sales with the closure of hospitality venues and we worked closely with our suppliers to offer support and re-route products destined for pubs, in order to meet the demand of our customers and avoid the liquid from going to waste. We have even teamed up with on-trade wholesaler, Matthew Clarke, to use some of their fleet of trucks to deliver beer from direct to our stores and try to satisfy the unbelievable demand that we are experiencing. At Co-op, sales of packs of 15 tins or more are growing over 1000% year-on-year, so in order to keep up with this demand, large packs of beer and cider that were due for on trade were also re-routed to Co-op stores, which would have otherwise been wasted.

Have you seen any significant shift in type and price of wines and spirits sold and, if so, what?

Demand across all wine styles has been unprecedented. Bag in Box has seen an renaissance and we have brought in additional lines to meet the growing popularity. Sparkling wine has also seen an uplift and in the last month, we have seen strong Champagne sales as a result of a new range brought into stores in February and customers trading up. Spirits have also seen an uplift in sales with premium rum seeing huge double digit growth, with spiced and flavoured varieties driving this category.

Covid-19 has ignited discussions around health, not least the government’s anti-obesity campaign which could see mandatory ‘hidden calorie’ content on alcohol labels and menus in the on-trade. In your view, what would be the impact of this?

We have been leading the way on our alcohol drink labels for some time and have been listing calorie information across our BWS range since 2002 to enable customers and members to make informed choices on their purchases. As a convenience retailer we do our very best to ensure that we offer a wide range of content to suit all of our customers and members and always try and find the right balance of what our customers expect to see within our stores. We have a great new range of low alcohol wines for instance which we promote to offer our customers alternatives.

Have the past few months led to any positive change that the trade can and should adopt going forward?

We have seen great support from our suppliers, including those who re-directed their on-trade resource to support us during the lockdown period. The continuation of on-trade and off-trade supporting each other is welcome. A move to video conferencing technology to communicate with stakeholders during this period has seen positive changes in keeping up momentum and giving valuable time back to support that healthy work/life balance so something we’ll look to continue.

Covid-19, recession, Brexit, climate crisis – we’re living though extraordinary times – what will the biggest challenges for the drinks trade going ahead?

Consumers are increasingly varying their breadth of repertoire and purchase in the drinks aisle according to their mission and occasion which will see a blurring of traditional lines between drinks’ categories of soft drinks, no/low alcohol and BWS. Embracing this change will create only new opportunities for us to reach new customers.

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