CEO interview

The latest in a series of regular 5-minute Q&As with Musgrave Group CEO Chris Martin

How is Musgrave handling tougher trading conditions?
CM: With the absolute conviction we and our retail partners will emerge stronger from this downturn. First, over the past few years we’ve invested heavily in brand development. This means ensuring each of our brands is optimised to deliver competitive edge to our retail partners in local markets and value and quality to the communities they serve.

These are brands consumers now associate with great deals, while still relying on the quality and depth of our offer. This is especially important as more people come to depend on the integrity of own-brand products.

Second, we continue to make very significant investments in systems and infrastructure. Best-in-class systems deliver efficiencies and savings that can be passed on to consumers. This investment ensures sustainable value for both retailers and their customers.

Does this make a real difference to the weekly shop?
CM: Yes. Right now our commercial teams are reducing prices for consumers through a combination of market leading promotions and permanent price reductions. SuperValu’s ‘All we’ve cut is our prices’ campaign is a great example.

In 2009 we’ve already invested more than €230 million with over 3,000 permanent price cuts on everyday products and brands across all ranges in all 194 SuperValu stores. These price cuts mean that for SuperValu customers the average trolley of goods has now dropped by almost €70 since January.

And as always we’ve accomplished this without compromising our support for Irish suppliers, brands and jobs.

Why is such support important?
CM: Because community and sustainability are at the very heart of our heritage and business model. It’s why wherever possible we buy Irish in Ireland, British in Britain and support local businesses in Spain.

Because we’re a modern family business without institutional shareholders, we can afford to plan for the long-term and develop stable relationships with all our partners – retailers, suppliers and communities.

This longer term approach to business is also reflected in the partnership that exists between ourselves and the retailers associated with our brands. It’s why in response to the tough trading conditions, we’ve increased cash flow support, margin support and made significant investments in price reductions to support their businesses.

More generally, I’m proud that this year we were able to celebrate 30 years of supporting Irish through our SuperValu and Centra brands. Last year our contribution to Irish jobs and suppliers was in excess of €2.85 billion. 75 per cent of everything on SuperValu’s shelves is sourced or produced in Ireland and SuperValu alone is indirectly supporting over 14,000 jobs.

What lies behind your support for the Yes vote in the Lisbon referendum?

CM: We believe the No vote would destroy Ireland’s capacity to influence EU decision making and have a hugely negative impact on the food industry and, consequently, the economic sustainability of local communities across the country. Give the challenging economic climate, we think Ireland has to maintain its influence in the heart of Europe by shaping the regulatory environment which is largely set by the EU.