MSE News: Morrisons to launch online store... but only next year

Lugh_Chronain

maxtweenie wrote: »

They only bought Kiddicare in the first place to get an internet presence otherwise they would have had to start from scratch.

From what I've read it's more to do about know-how than presence though you're probably right.

In 2011, Morrisons bought children's retailer Kiddicare for £70m to give it the knowledge to sell clothing and homewares online.

Morrisons buys Kiddicare for £70m

loracan1 wrote: »

Aiming to have 100 or so M-local stores up and running before end of year.

The C-store chain currently operates 14 stores in major places such as Birmingham, Manchester and Bristol. With plans for more than 70 by the end of 2013.

http://en.wikipedia.org/wiki/Morrisons#Morrisons_M_Local

Steve059 wrote: »

Fair enough. So, I won't be able to find out that they're cheapest for something I need, and then buy it from them, until 2014.

I wonder if mySupermarket.co.uk will catch on to this?

mystic_trev wrote: »

I disagree. At the moment Supermarkets lose around £5 on each delivery. It's not the money spinner many people think it is.

As pointed out by pullenuk with regards to Sainsbury's.

Online continues to perform strongly, growing at over 20%, with grocery orders regularly exceeding 165,000 a week.

Interim results for the 28 weeks to 29 September 2012 if you want to check for yourself.

[Deleted User]

antrobus wrote: »

Second Asda 'dark store' takes on Ocado
http://www.thegrocer.co.uk/companies/second-asda-dark-store-takes-on-ocado/211799.article

So Asda does have dark stores.

There you go again... implying that they only use dark stores.

Own_My_Own

Sorry, but does anyone else think the title of this thread is written in very poor English ?

antrobus

Deleted_User wrote: »

There you go again... implying that they only use dark stores.

That's only in your imagination.

antrobus wrote: »

None of the offline boys only use dark stores.

Is that there something about that statement that isn't clear?

antrobus

Lugh_Chronain wrote: »

From what I've read it's more to do about know-how than presence though you're probably right.

In 2011, Morrisons bought children's retailer Kiddicare for £70m to give it the knowledge to sell clothing and homewares online.

Plus there's the Lakeland deal and Morrisons also have a 10% stake in FreshDirect a US based online grocer. The formal corporate announcement of that deal talks about how the "investment will play a key role in the development of Morrisons online food business in the UK" and states that "FreshDirect will receive a minority economic interest in Morrisons planned London online operation".

http://www.morrisons.co.uk/corporate/Media-centre/Corporate-news/Morrisons-Announces-Strategic-Investment-In-FreshDirect-Leading-USOnline-Grocer/

So why does Morrisons need Ocado's "know-how"? Isn't there a limit to how much extra expertise you need to launch an online grocery business?

Come to think of it, why is Ocado prepared to sell it's "intellectual property and operating knowledge" to help another business set up in competition? Does this mean that;

(a) Ocado management are bonkers?
(b) even Ocado management don't believe their own hype about becoming a multi-billion pound business and are desparate to offload some costs in the short term so they can meet their bonus targets?
(c) it's all just a smokescreen for some talks about something else entirely (merger, bid, whatever)?

Just curious, you understand.

Lugh_Chronain

antrobus wrote: »

Plus there's the Lakeland deal and Morrisons also have a 10% stake in FreshDirect a US based online grocer. The formal corporate announcement of that deal talks about how the "investment will play a key role in the development of Morrisons online food business in the UK" and states that "FreshDirect will receive a minority economic interest in Morrisons planned London online operation".

http://www.morrisons.co.uk/corporate/Media-centre/Corporate-news/Morrisons-Announces-Strategic-Investment-In-FreshDirect-Leading-USOnline-Grocer/

So why does Morrisons need Ocado's "know-how"? Isn't there a limit to how much extra expertise you need to launch an online grocery business?

Around the end of November last year Morrisons began selling wine through Morrisons Cellar - which initially launched as both a website and in mobile-optimised form. The Cellar website had been driven by the expertise of online baby product retailer Kiddicare.

It’s probably no exaggeration to say they wouldn’t be where they are today if it hadn’t been for the Kiddicare acquisition. In respect to this, it does appear more likely they currently have more of an interest in experience/knowledge than in online presence, in my opinion anyway.

Of course they are aware of the importance of online presence, Morrisons have admitted annual results fell short of expectations (and as mentioned in MSE Jamie's article) as they have said they lack a meaningful presence in the two fastest-growing sectors of the market - online and convenience stores, amongst other things as well.

antrobus wrote: »

Come to think of it, why is Ocado prepared to sell it's "intellectual property and operating knowledge" to help another business set up in competition? Does this mean that;

(a) Ocado management are bonkers?
(b) even Ocado management don't believe their own hype about becoming a multi-billion pound business and are desparate to offload some costs in the short term so they can meet their bonus targets?
(c) it's all just a smokescreen for some talks about something else entirely (merger, bid, whatever)?

Just curious, you understand.

Possibly the latter as it appears there's more to it than what meets the eye.

Richie-from-the-Boro

In my area the 'picker' is indeed the poor wage slave that delivers, as I buy from Sainsbury's and Asda only I can only speak for those two. I do have direct 'supervisor' telephone lines for both and am regularly spoken to by both local stores.

Now why would any retailer spend mi££ions on developing a local~to~my~area 'dark store' when the current volume of internet shopping / delivery is adequately serviced by current allocated resources - I do not believe they would do so locally or even regionally unless the volume of margin from a 'dark store' makes bean counting sense.

As to Morrisions late entry, better late than Woolworths, HMV, Jessops etal. Shoppers are empowered by the net and will use that power how each individual chooses. For example brand (1) loyalty - single brand buyer versus the purely mercenary shopper who decides (2) who has the cheapest lager per litre this week gets my whole shopping list. We are at year 3 of at least a 6 year recession, non-food is down about 0.5%, food is up by 3% the internet reduces the need for more stores and the net model continues to replace the new stores location model.

So big cities & towns and big [OOT] locations will continue to grow while local shopping centre projects will increasingly be put on hold till the recession is over towards 2030. Big and small retail, particularly independents will slam the door on any super-marketing operation that isn't profitable switching to the expensive high margin 'one stop' type reatil operation.

Niche regional internet buying by the biggies will continue with wine and whatever but by far the biggest cash flow and margin will be the weekly shop at close to £3k per unit annum - you've got to be in it to win it and as yet Morrisions are not even on the starting block.

The power I mentioned earlier will shift even more to the consumer, they are buying less and changing food stores like their electricity supplier, social networking and website comparison apps on mobiles and handhelds will add even more power to the individual. Woolworths, HMV, Jessops and others like Morrisions thought they were fireproof ............... once !

gailey_2

morrisions and ocado have different customer demographic.

i chose ocado as good service, tesco pricematch, lots of organics/free rage and waitrose range is huge stuff not seen in other superarkets.

Really hard to work out whats good deal morrisions as does not appear on my supermarket occasionally get flyers in paper,
My 2nearest morrisions are small and they insist dumpbins everywhere, the queues are long, stores look bit dated and tired , have off layout, small range cant get everything I want there.

The fresh poultry section is dire on free range/freedom, fish is good, the chilled is dissapointing, bakeries good, fruit and veg very hit and miss dont last long they do have some good grocery and frozen deals. not much non foods.

There is a bigger store which has proper market format which is better and levels of fill always looks well stocked compared to sainsburys.

I worked for iceland when they were 1st in online shopping then tesco copied and others followed for some odd reason they dropped out of online but kept delivery drivers and vans.

They dident do from warehouse as wasent cost effective,
The big boys tesco, waitrose , saisnburys all have hub stores which are large so hopefully range and availiability be better which means my waitrose delivery coes from miles away as 2stores in city are too small.

Richie-from-the-Boro

Absolutely different demographics, Gissing is in the famous Bullingdon club photograph, just a few bow ties along from George Osborne. The whole concept was based on the fact that for the rich supermarket shopping is a chore. You give it to your housekeeper, or your driver. So they thought, if we can do for the average person what fame and fortune does for celebrities, and take that chore away, that might be something that really appeals. Now lowering that demographic from upper to middle class customers & prices, still a long way from ASDA / Morrisons & Tesco type prices and customer base.

[Deleted User]

I don't think they bought Kiddicare and a share of FreshDirect to gain knowledge in online shopping. They just say that to keep shareholders happy that Morrisons were wanting to start online shopping soon. It was purely for investment and expansion. Wise why would they be expanding Kiddicare into retail stores after buying up all the ex BestBuy stores if all they wanted was their IT infrastructure.

Now that they sh*t has hit the fan, they are rushing around actually trying to get an online business off the ground.