By Gerry Mulvaney, European Sales Manager, Landa Digital Printing
Supermarket wars have broken out in the UK with Morrisons, the smallest of the dominant big four groups, announcing a permanent profits warning with their quarterly results and plans to take on the discount retailers like Aldi and Lidl in a price war. The recent period of austerity has changed the shopping habits of UK housewives and instead of doing a loyal and regular weekly shop at one of the big four, they are now shopping online and in local convenience stores, combined with visits to the German discounters. Morrisons CEO suggested that this change in habits is now permanent and he is redefining his strategy to take into account this new marketplace.
It would appear that the other three will follow suit, as all their share prices have fallen in anticipation of lower profits. Aldi and Lidl have low prices and a much smaller product range, along with a much simpler “customer experience” than Tesco, Asda and Sainsbury. So if the big four are to start copying the German retailers, it will mean a big change to UK shopping habits. It will be interesting to see if the same occurs elsewhere in Europe.
Quite how this will affect the UK point-of-sale and display suppliers, along with those UK packaging converters supplying the big four, is yet to emerge. But you can be sure that there will now be a much bigger focus on ensuring customers make a purchase during their visits, given previous reliance on loyalty is disappearing.
POP/POS Producers Should Expect More Business
I suspect that prices will be checked and revised more often and be very sensitive to local circumstances. Particular products will be marketed more vigorously and for shorter periods. Promotions by the supermarkets will take place even more often. And it is likely that different versions of product packaging will be required in addition to the display materials.
So, as far as the POS and display producers are concerned, I can see more business coming their way. The run lengths will be shorter. The deadlines will be reduced even more and the number of jobs to be processed will increase.
I don’t suppose the supermarkets will be looking to pay more, so some tough bargaining is likely to ensue as well. The packaging converters are already seeing demands for more versions of the cartons and bags. It is possible that more use of personalisation will also occur as the supermarkets try to lure the shoppers and also improve their margins.
It would seem that the timing of the introduction of Nanographic Printing® technology is going to fit in well with these new demands. The B1 format Landa S10 Nanographic Printing® Press will make the shorter runs much more cost effective for the POS and display market, as well as eliminating a lot of prepress processes and reducing deadlines. It will also allow for greater use of versioning and personalisation in the packaging market.
As always, timing is everything!, and it would appear that Benny Landa has got his right again.