Morrisons boss says ‘it WILL be a merry Christmas’

Five shopping days until Christmas and even with many plans thrown into chaos yesterday, the boss of one of Britain’s biggest grocers is sure of one thing. There will be celebrations – families will still do what they can to enjoy the day. 

‘We’re banking on it,’ says David Potts, chief executive at Morrisons, who spent last week visiting stores at 6.30am, making last-minute calls to his suppliers and even dropping by a Brussels sprouts farm on Friday to check that this most crucial of Christmas products was going to make it on to dinner tables. 

‘The British public have been through quite a challenging year. It has shown what the country is capable of handling and now I think the country will celebrate this Christmas,’ says Potts, whose Bradford-based firm employs 125,000 people. 

Millions of families have cancelled travel plans under the tough Covid restrictions announced yesterday – and may now make extra trips to supermarkets to cater for Christmas at home. 

Potts urges customers to ‘follow our colleagues and wear face coverings where required’ in stores. But he says most shoppers have already been ‘using their nous and being savvy’. 

‘Customers have been shopping a bit earlier, things they can buy early and put them away and making sure they’ve got what they need, and we’ve seen that in our sales,’ says the Mancunian, in sharp contrast to sluggish Christmas trading last year when grocers struggled to galvanise shoppers. 

‘Now they can go out and buy fresh food – at least we’re hoping that’s the plan, given we’ve ordered a shed-load of it.’ 

Speaking from the head office of the £17.5billion business, he pours out a list of trend-setting products: vegan trifles, alcohol-free or premium mulled wine, ‘the best chocolate and orange melt in the middle puddings, which has won some sort of award that I can’t even remember’ and an ‘award-winning champagne for 18 quid’, alongside traditional beef joints and turkeys. 

Today, Potts, 63, plans to visit stores in Hull, around two hours’ drive from his home near Ilkley in West Yorkshire. 

The former supermarket shelf-stacker knows what it’s like to be a foot soldier and is clearly proud of the work his staff have done in a tumultuous year. 

The ‘thank you’ translates into an increase in the staff discount from 10 per cent to 15 per cent and a bonus double the normal maximum – 6 per cent of salary with the next instalment arriving in February. 

Morrisons also won plaudits early on with its efforts to get ahead of events – delivering doorstep boxes to the vulnerable and handing £10million of groceries to food banks as well as dedicated shopping hours for essential workers, paying small suppliers immediately and accelerating its online business, which has tripled in size since the beginning of the year. 

Overall, sales from May to the beginning of August rose 12.3 per cent. The previous year, by contrast, sales dropped marginally. More strikingly, Morrisons was the only one of the Big Four grocery giants – the others being Tesco, Sainsbury’s and Asda – to increase market share in the past 12 months, according to research firm Kantar. 

‘The mood has been electric,’ Potts says, thinking back to the early weeks of lockdown, stockpiling and mass closures of high street shops, pubs and restaurants, which drove shoppers to his stores en masse.

‘Back in March the Prime Minister said everyone should stay at home – what he meant was everyone apart from supermarket workers and other essential workers. 

‘In our case, 125,000 people put their bodies on the line every day. Our own people are the new rock stars. They could not have done more for society and it’s very important that society doesn’t forget. 

‘The phrase ‘play our full part in feeding the nation’ led our thinking. At the last minute, we added ‘it’s more than our job’ on the end. 

‘Those words galvanised the organisation, so once we started to do certain things – the hour in the morning for NHS workers to shop, the discount for teachers and the immediate payment for small suppliers – and got into the rhythm of listening and responding wherever possible, it started to achieve its own momentum.’ 

Potts, as you might expect, has also been well rewarded for turning around a business that had been lagging its rivals and faced intense pressure from German discounters Aldi and Lidl. 

A raft of store closures in 2015 at Morrisons and other big chains, was followed in 2018 by the mooted merger of rivals Sainsbury’s and Asda – later blocked but which left a sense that big stores were very much in retreat. 

This year, supermarkets have once again found themselves at the epicentre of public life – a ‘renaissance’, he calls it.

‘The public found supermarkets are places they quite like to go: safe, secure, well lit, warm with friendly colleagues – all really important social needs. That need has been rekindled in light of Covid and isolation in society.’ 

Clearly revelling in the newfound relevance of stores that he has spent so much of his life within, Potts says: ‘Online delivery is a beautiful thing and it’s a great saver of time. 

‘But when the rubber hit the road, it was supermarket stores that came up with the goods and provided food for the people of the country and I know people won’t forget that.’  

He says stores helped ‘scale up’ online delivery. Morrisons delivers in partnership with Amazon and from an Ocado warehouse in Warwickshire but also ships directly to customers’ doorsteps from stores – 37 at the start of the year rising to 278 in a matter of months – as well as handing over orders to Amazon Fresh vans at 60 of its shops. Meanwhile, some of the successful strategies that exploded in the heat of the crisis in summer are still flying. 

These include 100,000 weekly food box deliveries – Winter Vegetables, the British Food Box from British farmers and the festive Christmas Eve Box to name a few – which can be ordered online or by phone. The boxes have proved a lifeline for the elderly and vulnerable, Potts says.

Another fledgling initiative is recipe-based EatFresh boxes, which come with all the necessary ingredients and cooking instructions for full meals. 

The grocery industry has not emerged untarnished from the peak of the crisis, however. Supermarkets accepted a business rates tax holiday earlier in the year, which nearly all have now repaid. 

And price competition with rivals is still firmly on the agenda. Potts says food price deflation has been a constant throughout 2020. 

But Morrisons, the only big supermarket to have a significant food manufacturing arm, is opening new stores again as one of the few traditional retailers going into the New Year with an air of confidence. 

‘Next year is going to be challenging for the country but I think the future is going to be more positive than such an uncharted 2020,’ Potts says. 

‘Let’s see where the country takes itself next year. The trends from Covid and Brexit have put a premium on ‘Britishness’ and two thirds of what we sell is British. We are Britain’s biggest single food maker. With Covid and in a Brexit year, all that is quite important.’