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:

• Waitrose invests in private label price cuts and gains two stores from Asda

• Morrisons closing 100 loss-making company-owned convenience stores

• Central and Midcounties final results show impact of cyber-attack

• Costco UK warehouse sales up 11.3% in 2025

Waitrose invests in private label price cuts and gains two stores from Asda

Waitrose is investing £20m to reduce the price of 160 of its private label products.  Some of the price cuts are as high as 30%, but overall average 12%.  The selected lines are amongst the most frequently purchased shopper essentials such as butter, eggs, apples and canned tomatoes.  Almost half of the lines covered are the entry level Essential Waitrose range.  In separate Waitrose news it has been announced that the retailer has acquired two stores at sites currently leased by Asda.  These locations are in Cricklewood, north London and Hale Barnes in Manchester.  Both stores are planned to open in autumn this year.

Insight Partner, Patrick Mitchell-Fox’s view: the two new Waitrose store will have sales areas of 18,000 and 15,000 sq ft respectively suggesting these sites are much more in the sweet spot of size for Waitrose than they are for Waitrose.  Before being opened by Asda the Hale Barns site was operated by north-west regional retailer Booths, the reputed ‘Waitrose of the north’, so it seems the catchment here will match the Waitrose demographic better.  These new stores are part of Waitrose’s ongoing £1bn investment in its store estate.  As well as 28 refurbishment projects 2026 will also see further new stores open in Chelmer Village, Essex and Ascot, Berkshire.

Morrisons closing 100 loss-making company owned convenience stores

Morrisons will close 100 Morrisons Daily convenience stores in the coming months, citing pressure from rising costs linked to government policy. The stores being closed are reported to be loss-making legacy McColl’s sites that have been operating as Morrisons Daily stores since Morrisons acquired the business in 2022. The announcement follows the closure of 17 convenience stores in 2025. Despite the announced closures, plans to open hundreds more franchise partnership stores in the coming years remain in place.

Senior Insight Analyst, Alex Rowberry’s view: the closure of 100 company owned stores whilst opening hundreds more franchise sites, will see the balance of Morrisons convenience estate favouring franchise partnerships by the end of 2027. The news makes it clear that operating profitably will be the key metric when assessing store performance.  

Central and Midcounties Co-ops’ final results show impact of cyber-attack

The two regional co-ops Central and Midcounties, now merged to form the enlarged Our Co-op organisation have published their last annual reports as independent societies for the year to January 2026.  Total turnover of the societies combined was £1,646m of which £1,228m came from food retail.  However, both societies suffered sales falls in the year primarily in their food retail divisions.  These declines (-4.5% at Central and -7.8% at Midcounties) were the result of a tough trading environment that was substantially amplified by the disruption to the national Co-op supply chain that services their stores, caused by a cyber-attack suffered in April-May 2025.  The steeper decline seen in Midcounties food sales was also driven by a programme of store disposals as it exited a number of unprofitable sites during the year.  Net of this impact Midcounties like-for-like sales were notably less negative on -1.3%.

Insight Partner, Patrick Mitchell-Fox’s view: the disruption created by the cyber-attack on Co-op has clearly been one of the significant factors driving the spate of mergers currently being seen amongst the regional co-operative societies, as they seek a safe harbour of greater scale and resilience in which to better survive the growing challenges of the commercial environment.  As well as the short-term crisis of the cyber-attack it’s clear that the regional co-ops have also been hit hard by the declining sales of traditional ‘big’ categories such as tobacco and alcohol as well as by rising business costs.  This week has also seen Southern Co-op membership vote in favour of its proposed merger with the national Co-op group.

Costco UK warehouse sales up 11.3% in 2025

The UK division of Costco, the global warehouse club giant, achieved turnover of £5.6bn in the year to 31 August, as revealed in its latest accounts filed with Companies House.  This represents total growth of 5.2%, a figure notably restrained by deflation in its fuel sales, which is a growing part of the Costco UK operation.  Net of fuel, sales of merchandise (food, household and non-food) were up 11.2%.  Within this Costco Online sales were up 15.6% reaching £320.4m.  Although margins online are slimmer than in the wider business Costco Online continues to be profitable.  While this is still a relatively small part of the overall business, growth will continue as Costco continues to expand the range of goods available online.

Insight Partner, Patrick Mitchell-Fox’s view: Costco UK will have been boosted to a degree by an increase in membership fees in March 2025, but the number of warehouses remained stable at 29.  Work has now begun on warehouse number 30, at Gloucester.  This is unlikely to be completed in Costco’s 2025/26 financial year, but will clearly help drive additional growth thereafter.  Costco also continues to add fuel forecourts to existing warehouse sites (Aberdeen will be the next one completed) and while the volatility of fuel sales may lead to sales falling in some years, Costco’s lowest price position on fuel ensures this is a significant incentive for membership sign-ups and renewals.

What to read next: The Waitrose upgrade: building for tomorrow

 

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