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

Tesco’s new five-a-day campaign, Poundland’s store closure programme, Co-op Wholesale’s 2024 results and Greggs’ H1 performance update.

• Tesco launches new five-a-day campaign

• Poundland to close 37 stores in August

• Co-op Wholesale (Nisa) fell to operating loss in 2024

• Greggs announces H1 results

• Iceland steps up animal welfare on prawns and eggs

• Cocoa supply faces uncertainty as small producers in Ivory Coast risk bankruptcy

• Kimberley-Clark to invest £125m in green hydrogen technology

Tesco launches new five-a-day campaign

Tesco has launched a five-a-day campaign to encourage UK families to eat more fruit and vegetables, addressing the low consumption rates. The initiative includes personalised Clubcard stamps on produce, new Clubcard Prices, weekly 'Fresh 5' offers, and free in-store fruit for children between August 4th and 17th. In addition, the Tesco Real Food website offers five-a-day recipes, aiming to provide inspiration and overcome common barriers to healthy eating. 
 
IGD Insight Manager, Sneha Haria’s view:

Tesco's latest campaign is a smart move, blending public health goals with its business aims. By using its powerful Clubcard loyalty programme and vast store network, Tesco can genuinely make a significant difference in encouraging healthier eating habits across the UK. It also bolsters Tesco's reputation as a socially responsible retailer. You can read about other recent health initiatives both in the UK and further afield in our Global health initiatives: Q2 update. 

Poundland to close 37 stores in August

Poundland is moving forward with its plan to close 68 underperforming stores across its estate, with locations dotted around the country. As part of a larger restructuring effort by new owners Gordon Brothers, 37 of these stores are set to be closed in August 2025, with final closures by August 24th. This strategy aims to stabilise Poundland's network for long-term viability and also includes closing two distribution centers and streamlining food offerings.

IGD Insight Analyst, Michela Pearson’s view: 

Poundland’s new owner Gordon Brothers is wasting no time in streamlining the estate to help turn around operations. In the latest quarter ending 30 June, previous owner Pepco reported continued LFL decline of 7.1%. Darren MacDonald, Retail Director at Poundland, stated “It is, of course, sincerely regrettable that our recovery plans include any store closures, but sadly that’s necessary if we’re to achieve our goal of securing the future of thousands of jobs and hundreds of stores.” To understand more about the UK’s variety discount landscape, look out for our upcoming report. 

Nisa (Co-op Wholesale) fell to operating loss in 2024

Renamed as Co-op Wholesale from March 2025, Nisa’s latest accounts filed with Companies House for the year to 5 January show sales down 5.3% (on a 52-week basis) to £1,319m with an operating loss of £130,000.  Profitability was impacted both by a fall in gross margin to 13.1%, reflecting investment in wholesale selling prices, but also by a relative increase in operating costs as a percentage of turnover.  The report cites the ‘challenging market conditions’ and ‘declining volumes’ faced in 2024, which followed a year of very high inflation seen in 2023. 

IGD Insight Partner, Patrick Mitchell-Fox’s view:

With prices rising sharply in the last few years independent retailers (as well as end consumers) have been looking for ways to reduce costs on their purchasing needs and competition amongst wholesalers has become intense.  Nisa, in particular, has seen a number of customers lost to sector challenger, Morrisons, which has a broader range capability as well as offering competitive pricing.  It should be noted that Co-op’s sales to the growing network of franchise Co-op stores (now worth £74m) are not included in the Co-op Wholesale (Nisa) accounts. 

Greggs announces H1 results

Leading food-to-go specialist Greggs has posted sales up 7.0%, reaching £1,028m in the six months to 28 June.  Growth was driven by new store openings with a net increase of 31 stores in the period, with the total site numbers reaching 2,649.  However, the uplift was underpinned by positive like-for-like growth with company-owned stores up 2.1% L4L and franchise sites up 4.8%. 

Chief Executive, Roisin Currie commented: ‘After a challenging start to 2025 we remain clear on the strategic opportunities that lie ahead. Through our disciplined estate expansion and focus on innovation, Greggs is evolving its offer further and making the brand more convenient for a wider range of customers’.

IGD Insight Partner, Patrick Mitchell-Fox’s view:

Greggs sees significant remaining headroom in the UK market for future store growth, targeting an ultimate capacity for 3,500 units across the country.  As well as innovating with made-to-order solutions to enhance the core offer, in the second half of 2025 it will trial a new store format, ‘bitesize Greggs’.  This will open up new locations that do not have space for a full-service Greggs unit such as railway stations. These stores will have a narrower range but will offer all Greggs’ iconic products.

Iceland steps up animal welfare on prawns and eggs

Iceland has announced two big steps to improving animal welfare in its supply chain. The frozen food retailer has announced it will stop eyestalk ablation in its own-label prawn supply by 2027. The retailer is also seeking to gain Aquaculture Stewardship Council (ASC) accreditation across 100% of its own-label range by 2026.  Separately, Iceland has also committed to transitioning its egg supply to be completely cage-free by June 2027.

Head of Supply Chain Insights, James Rothwell’s view:

Both moves were previously scheduled for a 2025 deadline but delayed as the discounter focused on affordability for customers. This new deadline shows a commitment to bringing their sustainability back on track in line with the major supermarkets and food retailers. 

Cocoa supply faces uncertainty as small producers in Ivory Coast risk bankruptcy

New European Union (EU) regulations will soon tackle an estimated 10% of global deforestation that’s driven out of the EU’s overall demand for cocoa. The new regulation requires producers to prove they do not contribute to deforestation in the process. In the Ivory Coast, a digital verification and payment system has been selected involving mobile payment operators facilitating direct payments from EU customers to the farmers cutting out unverified agents in between. Many farmers have flagged the costs of complying may drive them out of business adding uncertainty to the global supply of the commodity. The law is expected to launch from December 2025.

IGD Head of Supply Chain Insights, James Rothwell’s view:

Cocoa remains an important commodity in the production of many daily essentials and treats in the European and UK markets. This news may be unsettling to manufacturers as the impact on commodity prices and availability is largely unknown. Positive assurance has been given from the Coffee and Cocoa Council, the industry regulator in Ivory Coast that already around 90% of producers have signed up to the new verification process. 

Kimberley-Clark to invest £125m in green hydrogen technology 

Kimberly-Clark have announced the installation of green hydrogen facilities at the Barrow and Northfleet plants which are responsible for Andrew and Kleenex production. This upgrade will allow the manufacturer to reduce its natural gas consumption by 50% in 2027, compared to 2024. The move to green hydrogen has received government support after being selected for the Hydrogen Production Business Model and Net Zero Hydrogen Fund initiatives.

Head of Supply Chain Insights, James Rothwell’s view:

The upgrades announced go a long way to decarbonising the value chain of Kimberley Clark’s operations and will be inevitably one to watch over the next three years as the government use the learnings from the transition to support wider UK manufacturing industries. The route to decarbonisation in an energy-intensive process will be a big milestone for the UK economies wider aim to become net-zero.