Sainsbury's chief executive Mike Coupe has announced that he is to leave the UK retailer at the end of May, to be succeeded by retail and operations director Simon Roberts.
In a statement, Coupe said, “I feel very privileged to have spent almost six years running Sainsbury’s, in a period that has been the most challenging and competitive of my 35 year career in retail. Sainsbury’s is a very different business today to the one I took over in 2014."
Here's how leading retail analysts viewed his impending departure:
Bruno Monteyne, Bernstein
"This is not a surprise. For the last few months we have been discussing with investors the likelihood of Mike Coupe stepping down. The discussion initially started after the failed Asda-Sainsbury's merger discussion. Mike retained investor and board support past that event but at the same time there was a recognition that Mike had had a very long and good innings at Sainsbury's (the only big-4 supermarket that did not require to do a major margin reset in response to hard discounter growth).
"Simon Roberts is a continuity-operator appointment for Sainsbury's, reflecting probably the fact that the board and the management team probably think that Sainsbury's is doing a good job within a tough market and no major changes are needed. We feel slightly less certain about that.
"An external person might find it easier to challenge the current way of thinking within the company and bring in an entirely view on how customers perceive the company."
Clive Black, Shore Capital
"We are not surprised by this announcement. Mike Coupe is a very focused and intelligent executive who took on the mantle of leading Sainsbury at a most difficult time. He has rationally gone about his job but also showed immense ambitions, effectively acquiring and integrating Argos, to our minds, but materially over-extending the business’ capabilities in the eyes of the regulator with the proposed Asda merger.
"We have never faulted Mr Coupe for that merger attempt albeit we remain scathing at the Sainsbury NEDs and advisors that did not offer him better counsel for a deal we felt was doomed from the start.
"Mr Roberts takes over Sainsbury as it focuses down upon competing in an evolving and challenging UK grocery market. In September 2019, Sainsbury updated its future strategy at its Capital Markets Day in Southampton; a day when we noted the low participation of Sainsbury-Argos CEO, John Rogers, who subsequently left the business for WPP.
"The core outcomes of that event was a business that is going to focus upon sweating its existing assets, becoming a more joined up digital business – where much progress has been made under Mike Coupe – lowering costs (several hundred management roles were revealed as surplus to requirements only yesterday) and delivering free cash generation."
Russ Mould, AJ Bell
“Farewell, Mike Coupe, the deal-hungry Sainsbury’s boss who may unfortunately be remembered for his singing rather than retailing. He did the dance with Argos and Nectar but tripped up with attempts to marry Asda and partner with Danish retailer Netto in the UK.
“Just when you thought being caught on camera singing ‘we’re in the money’ was a low point, the Asda merger subsequently didn’t happen and Coupe was left scrabbling for a plan B.
“Despite such hiccups, it is fair to say that he wasn’t afraid of making some bold strategic decisions, even if perhaps he should have been paying closer attention to the day-to-day running of the business. Argos is proving to have been a good deal and recent grocery trading has been fairly resilient despite intense market competition.
“Coupe’s replacement is Simon Roberts who is currently the retail and operations director at Sainsbury’s. With a background at Marks & Spencer and Boots, he will be no stranger to the operational challenges facing large retailers.
“His agenda is likely to focus on getting more out of the existing business rather than finding new things to bolt on. Like most retailers, the priority is to have a superior digital offering and a top-notch supply chain. That is likely to involve investment in IT and logistics, something that sounds very similar to Marks & Spencer’s current situation."
Nigel Frith, www.asktraders.com
"The announcement from Sainsbury that CEO Mike Coupe is stepping down after 6 years at the helm, may not come as such a surprise given the annus horribilis for the supermarket chain. A fresh start is needed after the previous year saw a failed merger between Sainsbury and Asda for which Mike Coupe was the architect of the deal, in addition to 5 straight quarters of flagging sales and the share price plunging 22%.
"Add into the mix hundreds of jobs being slashed at head office this week and it is clear to see this is certainly not Sainsbury’s finest moment. That said, the industry as whole has been extremely challenging to navigate, which doesn’t look set to change anytime soon."
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
