Co-op moves to boost product availability

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The Co-operative’s introduction of the SMART stock management system has increased in-store product availability to 97.5 per cent, the group said in its half year report.

The system is currently being rolled out more widely across the food business and the retailer is also overhauling its workforce management system to strengthen local service, and increase trading hours by 15,000 hours a week.

“Behind the scenes we are continuing to focus on efficiency, completing work on overhauling our supply chain network to underpin the retail proposition. The purpose-built network will have one National DC, nine Regional DCs, and two stockless cross-docks, and will have capacity to handle 32,000 deliveries a week giving us an industry-leading distribution network,” is said.

Tough trading conditions meant that the group’s total underlying operating profit fell to £174m in the first half of 2012 from £264m a year ago. Sales were up marginally at £6.6bn.

Chief executive Peter Marks said: “A year ago I warned that we were operating in the worst conditions that I have seen in more than 40 years in business. The results we are announcing today show the full impact of that with the profitability of our two biggest businesses affected.

“The impact has been felt most keenly in our bank which has been hit by increased impairments on lending to corporate customers and the on-going low-interest-rate environment. On a positive note however, our specialist businesses division continues to perform well and saw a strong increase in profitability in the first half.

“Looking ahead, we remain confident and we expect an improvement in sales and profit in the second half.”

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