Bibby Group News
Red Orange sign long term supply agreement with Costcutter
Red Orange has signed a 5 year supply agreement with Costcutter commencing 28 June 2010. With 36 stores predominantly in East Anglia, but also in the Midlands, South and Merseyside, the move will strengthen both businesses by way of additional volumes as well as greater support for the Red Orange retail members. The agreement allows Red Orange retailers to retain their existing fascias and independence, but still benefit from all the services Costcutter currently offers its members.
Chris Futter, Managing Director for Red Orange, said “We have been a member of Nisa-Today’s for 25 years and it was clear that to develop our business further, we had to make a strategic change for our members. Over recent years members of Red Orange have seen a dilution of the Nisa commercial terms, which has been a primary driver why we have decided to make this change and also the frustration of finding that our supply chain partner is also now a major competitor, who has been targeting our members. Our new agreement with Costcutter will greatly improve the offer to our members with a wider direct to store supplier choice, extensive retail guidance, access to the Costcutter Epos system and stronger, consumer-focused marketing.”
Nick Ivel, Managing Director for Costcutter Supermarkets Group, said “We are delighted to welcome Red Orange and its retailers to the group. This is the first step in our strategic growth plan for 2010 to strengthen our volumes in the market place. It is an unacceptable situation with Nisa at the moment as they continue to develop their symbol group to compete directly with their non-symbol members who are shareholders in the business, as outlined in their recent trade press articles.
“We will add real value to Red Orange members with great central office support from the Costcutter retail team, including category management advice and store development expertise. We’re confident that we can grow the turnover that the stores currently achieve by implementing our proven business development strategies. Costcutter is performing well in an increasingly competitive market. Our recruitment is strong and the fantastic marketing campaign we’re running for the World Cup, including upweighted TV advertising, continues to drive brand awareness and consumers into Costcutter stores.”
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