Costcutter Supermarkets Group and Palmer & Harvey today announced the launch of a new joint venture company that will transform the convenience sector in the UK through its £5 billion negotiating and buying power.
Called The Buyco, the new company will be unique within the convenience sector, providing Costcutter Supermarkets Group with access to the largest volume buying power in the sector, resulting in the most competitive prices for its members as well as an industry-leading range of products and promotions at highly competitive prices.
As a joint venture business which will be 50% owned by both companies, The Buyco is being set up to allow Costcutter Supermarkets Group to meet the needs of its independent retailers and all of P&H’s existing independent retailers. In order to negotiate the best deals through maximum volume, The Buyco will also serve the buying needs of Palmer & Harvey’s existing independent retail customer base.
Coinciding with the creation of The Buyco, Palmer & Harvey will be moving away from direct management of symbol group convenience retailing to focus on its wholesale distribution strengths. The Mace, Supershop and Your Store brands, operations and 800 stores will join the Costcutter Supermarket Group family of brands which includes the 1,600 plus Costcutter and kwiksave stores. This transfer will come into effect on April 72013.
In addition, Costcutter has signed a new eight year wholesale distribution contract with Palmer & Harvey.
Darcy Willson-Rymer, CEO of Costcutter Supermarkets Group, said, “We have been single-mindedly focussed on creating maximum value for our members and it became wholly apparent that without access to the proportionate benefits of our own buying power this could not happen. Through the creation of The Buyco with Palmer & Harvey, we will have unrivalled purchasing power within the UK convenience sector meaning that we can ensure the best prices, promotions and range for our members. Combine this with the industry leading distribution capabilities of Palmer & Harvey and we firmly believe that Costcutter Supermarkets Group will be offering the best possible service to our Members.'
Costcutter Supermarkets Group is also announcing the introduction of a new, bespoke range, negotiated on its behalf by The Buyco. This will include an extensive chilled and fresh proposition, and a new three tier own label range which Costcutter Supermarkets Group is developing for all categories and will support through marketing investment that will see it emerge as an industry leading brand.