Hypermarkets and Supermarkets

Woolworth opened its first out-of-town Woolco store in Oadby, Leicester in 1967. The concept was inspired by the parent company in the USA, which had launched a branch in Columbus, Ohio in 1963, and had expanded rapidly across North America. The idea had proved popular in the UK making the Board keen to push ahead.

A task force reviewed the latest retail thinking the globe. It identified an opportunity to move from a department store to a hypermarket format. The group, led by Hugh Jones and Mike Morris, was given a mandate to test its ideas in a new-build store that was already planned for the Ards Centre in County Down, Northern Ireland.

They widened the gangways, opting for fewer, taller island counters to a height of seven feet (2.4m) instead of four feet (1.4m). Customers were encouraged to use shopping trolleys instead of traditional hand baskets. To entice shoppers to travel, the site included a filling station, which gave a 15% discount on petrol.

The new look was ground-breaking and set a standard which has become familiar today. The store was a hit. It went straight to the top of the company sales table.

The decision to open in Ulster was both brave and imaginative. Political instability and the threat of terrorist attacks in "the troubles" had discouraged retailers from investing in the Province. But people still needed to eat and shop, leaving a gap in the market.

Woolworth had originally intended to open a traditional store in the Shopping Centre. The decision to make radical, late changes to the layout sparked interest and speculation across the Irish Press.

The opening drew huge crowds, who formed an orderly queue. Most had to wait for two hours to get into the store on its first day, as the Royal Ulster Constabulary and the British Army searched everyone on the way in.

Ulstermen and women had become used to such delays and waited patiently for their turn to enter the huge store. When they got inside, they were in the mood to spend.

Many were dumbfounded by the sheer scale of the shop and its huge displays and bright lighting. It was quite unlike anywhere they had shopped before.

Half of the salesfloor was dedicated to groceries. As well as aisles of canned and packet goods, and banks of Birds Eye frozen food, there were specialist counters which were like the shops in a traditional High Street. There was baker with fresh bread and cakes, a delicatessen with cheeses, bacon, and cut meats, a butchery, and even a fishmonger. Experts were on hand to help.

The other half of the store offered a comprehensive selection of items for the home, garden and family. These included upscale displays of fashions for all ages and tastes, furniture and homewares, appliances and audio-visual as well as sports and leisure goods. The store also stocked the full Woolworth range from pic'n'mix to DIY, gardening, toys and toiletries.

Trading figures showed a step change. The store quickly became the best performer in the UK, recording weekly turnover of £145k, matching the combined sales of the premier Irish stores in Henry Street, Dublin (£63k), High Street, Belfast (£70k) and Ferryquay Gate, Londonderry (£20k) on its own.

The fifty/fifty mix of food and general merchandise proved a good combination. While the gross margin was lower than in the High Street stores, at 22.5% it remained respectable. Despite employing more than 200 people, the weekly salary bill of £10.5k was the lowest in proportion to sales of any branch in Britain or Ireland.

Jones and Morris had found a winning formula. Jones was tasked with planning mainland versions in Maidenhead, Berkshire and Nottingham. Morris was given a yet tougher challenge. He was given control of the Woolworth Metropolitan Region, and asked to deliver the same step change in results across the 250 branches in South East England, including the London flagships.

The bold steps in the Woolco hypermarket were in marked contrast to the main Woolworth chain's confused offer of groceries and food during the 1970s. Executives faced an uphill battle to persuade the Board of the American parent that the low margin goods were right for the subsidiary. As a result a roll-out of fresh fruit and vegetables in the Sixties was abandonned in the early Seventies, as the Board opted for a twin-track strategy. It was decided that every store would stock a compact range of tinned and packet groceries, along with biscuits, cakes, pet food and soap powders, while the larger stores and those with particular potential would also incorporate a personal service delicatessen counter, with meats and cheese cut to order and sold by weight.

The idea of a handy convenience selection of groceries tucked into the corner of a shop selling other things is commonplace today. But at the time it was a rarity. Managers were asked to squeeze in the selection in the middle section of the shop, away from the main entrance, aiming to draw customers in from the sweets, toiletries, records and cards inside the entrance towards the higher margin home, garden and clothing ranges at the back.

Some, like Pinner, Middlesex (left) were able to make the range look credible in a separate area of its own. But many displayed the foods next to seasonal departments like gardening, or ranges from the back of the store that needed to be kept in view, like glue or batteries. This added to a growing perception among shoppers that the 'jack-of-all-trades' formula was outdated. Even the larger stores, like Southend-on-Sea (below) struggled to differentiate the food offer amidst all the other displays.

Sales were driven principally from heavily discounted own-brand ranges, which followed the chain's age-old trading pattern. Tinned fruit for sixpence had been introduced in 1937 and remained a mainstay forty years later. Cheap biscuits had first been offered in the Roaring Twenties. The only new departure was deep cuts on some supplier brands goods, like 2lb (0.9kg) of Tate and Lyle or Silver Spoon Sugar, and 4oz (125g) boxes of PG Tips Tea. This responded to a new, emerging competitive threat from discounters like KwikSave and Victor Value.

During the Seventies Woolworth invested heavily to introduce delicatessen counters to its largest stores. Behind the scenes new preparation rooms were built along with large walk-in refrigeration units for storage.

Sales were best where the shape of the building suited the creation of a dedicated floor of groceries, resembling a supermarket. Food Halls with their own entrance from the street or a precinct gave the highest return. But the personal service operation was expensive to run. It required more staff training and on-costs behind the scenes for maintenance and improved hygiene. In the final assessment, despite boosting traffic, few of the food halls broke even.

Only the business model at Newtownards appeared to have the potential to turn make money.