Operating Review
Developing our stores
Having made such good progress in improving our performance we renewed our search last year for locations where we could introduce Sainsbury’s to new communities. During the 2006/07 financial year we increased our space by 3.8 per cent, driven mainly by our ability to acquire more new space than planned. This was ahead of target primarily due to increased activity in the second half of the year.
20 new convenience stores opened During the year we opened 20 supermarkets and extended 18. A further 50 were refurbished, one was downsized and 48 benefited from investment in their non-food offer. In our convenience operation, 20 stores opened, 22 were refurbished and 30 converted to our ‘Sainsbury’s @’ format. Two convenience stores closed and two supermarkets were closed due to relocation to improved sites.
New space growth opportunities are now being developed as we plan a ten per cent growth in space over the next three years. We plan to open 30 new supermarkets and 100 new convenience stores and we are targeting the completion of 75 extensions and 190 refurbishments, with the large majority undertaken on our freehold and long leasehold estate.
We are actively managing our property portfolio. A specialist property team is building a pipeline of new stores and more than 50 per cent of our current estate will be developed by March 2010 and at least 60 stores will be over 55,000 square feet with over 15,000 square feet of non-food ranges by March 2010. The pipeline will be developed to deliver space growth at five per cent each year from 2009/10.
The ownership of property is aligned to these operational plans and provides significant opportunity to maximise both operational and freehold property value from our portfolio.
