Food chain Scotmid given boost as more locked-down consumers shop local

Co-operative food business Scotmid has chalked up strong first-half results as more locked-down consumers shopped local but warned of an “uncertain” second half.
The Edinburgh-headquartered Scotmid co-operative group has trading roots that go back 160 years.The Edinburgh-headquartered Scotmid co-operative group has trading roots that go back 160 years.
The Edinburgh-headquartered Scotmid co-operative group has trading roots that go back 160 years.

The Edinburgh-headquartered group, whose trading roots go back 160 years, said results from its Semichem discount health and beauty arm were “significantly down” after stores were closed for an extended period.

Scotmid Co-op delivered a £3.1 million trading profit for the 26 weeks ended 25 July, compared to £2.5m in 2019. Turnover increased by £6.7m to £197m.

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Chief executive John Brodie said: “This result was heavily influenced by changes in consumer behaviour as a result of Covid-19. We adapted quickly to the new ways of trading and working during the pandemic and this was achieved for our diverse set of businesses.

“Our food convenience business benefitted from more customers choosing to shop locally.”

He noted that some city centre branches had faired less well with fewer office workers around to purchase lunchtime snacks and food on the way home.

Brodie also expressed confidence in supply chains amid reports that some consumers may be panic and bulk buying again after the new coronavirus restrictions kicked in.

Scotmid will also continue with its “sound” growth and investment strategy, pressing ahead with new stores in Edinburgh and Bo’ness, for example.

Brodie said: “Despite record sickness levels and social distancing requirements, our front-line colleagues, support teams and supply chain responded to the unprecedented demand levels and continued to serve our communities through the peak of the crisis. Positive feedback was overwhelming in appreciation for the store teams.

“In contrast, all our Semichem stores were closed for an extended period so even with the benefit of vital government support, its result was significantly down.

“Property income came under pressure and our funeral [business] colleagues went the extra mile in adversity to provide the best funerals possible, in adherence with government guidance.”

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He added: “Last year I highlighted the importance of our continuous improvement philosophy to help guide the society through the considerable challenges faced from global events. In this financial year-to-date the society has successfully applied this approach to serve our communities in their time of need.

“This, however, is only the starting point because as government support is withdrawn, the recession is likely to be prolonged, not helped by the uncertainty caused by the Brexit transition.

“So looking ahead to an uncertain second half of the year, it is more important than ever for Scotmid to focus on matters under our control and deliver our core purpose of serving our communities and improving people’s everyday lives.”

The society said it had donated more than £160,000 to alleviate hardship through a dedicated Covid community fund in addition to other community funding.

In May, Scotmid posted a trading profit of £5.6m for the year ended 25 January, up from £5.3m in the previous 12 months. Trading turnover grew by £7m to £385m.

It said the positive result was driven by strong sales figures from its food convenience arm “when food was faced with significant cost increases but delivered consistently strong like-for-like sales underpinned by range improvements and innovation”.

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Scotmid vows to adapt amid Covid-19 as profits jump

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