UK roundup: low-carbon and store development news

In this instalment, our UK analysts offer their take on some of the market’s latest developments and initiatives. Here’s what you need to know about:

• Tesco selling UK’s first low carbon potatoes

• Morrisons commits to £1.6 bn investment in British farming in 2026

• Morrisons adds Nutmeg clothing to online shop

• Asda investing £2.5m into in-store opticians

• Dobbies parts with Waitrose as it goes it alone for foodhalls

Tesco selling UK’s first low carbon potatoes

Tesco has become the first UK retailer to sell low-carbon potatoes. The retailer, in partnership with Branston has grown 500 tonnes of Georgina variety potatoes at a concept farm located in Lincolnshire. Methods employed to reduce the carbon footprint include the use of circular economy fertilisers, minimum crop cultivations, and the transition to hydrotreated vegetable oil fuel, with a 90% lower carbon footprint versus conventional diesel. Combined, these measures reduced the carbon footprint of the potatoes by more than 50%.

Senior Insight Analyst, Alex Rowberry’s view: Tesco is exploring multiple ways to reduce its carbon footprint. The roll-out of low-carbon potatoes follows the opening in November of the retailer’s low-carbon concept store in Harrogate. These developments provide a glimpse of longer-term developments across the industry, as retailers work towards the target of being net-zero carbon across supply chains by 2050.

Morrisons commits to £1.6 bn investment in British farming in 2026

Morrisons will commit more than £1.6 bn to British agriculture and food production in 2026. The announcement will see the retailer continue its support for a series of multi-year partnerships with farmers supplying the retailer’s fruit and vegetables, meat, fish, dairy and eggs. As part of this commitment, Morrisons has introduced a shared farming agreement for potato farmers that underwrites 100% of costs associated with growing crops, mitigating the impact of poor weather conditions on harvests.

Senior Insight Analyst, Alex Rowberry’s view: Morrisons prides itself on being British farming’s largest single customer, with a relationship stretching back 117 years. At a time of rising production costs and the impact from unpredictable weather conditions, Morrisons commitment to multi-year partnerships will provide a measure of reassurance to farmers to invest in long-term growth plans.

Morrisons adds Nutmeg clothing to online shop 

Morrisons has introduced clothing to its online store as it builds on the double-digit online sales growth achieved in its 2024/25 financial year. The launch includes 40 items from its Nutmeg clothing line, covering what the retailer calls everyday staples often forgotten by shoppers, such as socks, tights and baby grows. More items will be added as the offer is expanded.

Senior Insight Analyst, Alex Rowberry’s view: Morrisons joins Tesco in offering shoppers’ items from its clothing range when shopping its online grocery store. The service follows the launch of Morrisons online travel store in January as it provides shoppers with more reasons to shop at the retailer. The goal will be to limit the number of shoppers tempted to switch spend to another retailer. Asda and Sainsbury’s clothing lines are available on online stores separate to their main grocery sites.

Asda investing £2.5m into in-store opticians

Asda will invest £2.5m into its in-store optician service over the next 12 months. The investment will see refits to 18 of its 156 optical units, upgrades to diagnostic equipment across its estate with new optical coherence tomography (OCT) and new pre-test technology. Staff training and development will also receive investment, and the retailer will double the intake of optician apprentices.

Senior Insight Analyst, Alex Rowberry’s view: Asda has identified the in-store environment as an area for improvement. This latest round of investment follows £11.8m invested into seven of its northern stores at the end of last year as the retailer looks to develop its existing assets as part of its plan for returning to growth.

Dobbies parts with Waitrose as it goes it alone for foodhalls 

Recent store visits have highlighted the fact that Waitrose is no longer supplying the foodhalls in Dobbies, with the garden centre chain remodelling its food proposition as The Foodhall by Dobbies. Some stores have Waitrose private label lines and general grocery lines on clearance, with the new Dobbies range taking on a more upmarket regionalised slant. The collaboration between Dobbies and Waitrose kicked off in 2022, with around 50 garden centres housing a dedicated Waitrose foodhall section offering around 2,000 products. As reported by Sterling News, the deal is understood to have started unwinding late last year by mutual agreement.

Retail Futures Senior Partner, Bryan Roberts’ view: The dissolution of the Waitrose deal is not a huge surprise, following as it does the demise of a similar arrangement with Sainsbury’s. Garden centre shoppers are obviously not in the same frame of mind as a supermarket shopper, and it makes more sense for Dobbies to house a more premium, indulgent, and localised proposition. Our recent visit to the work-in-progress Foodhall in the flagship Dobbies in Lasswade, Midlothian, revealed an excellent concept. The store included local fresh produce, bakery, a meat and deli counter from The Buffalo Farm, premium BWS, world foods, local products, and gifting. Frozen brands present included Cook, Fieldfare, Brickell’s ice cream, and Bertha’s pizza.

 

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