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J Sainsbury plc

J Sainsbury plc

Stamford House
Stamford Street
London SE1 9LL
United Kingdom
Telephone: (020) 7695-6000
Fax: (020) 7695-7610
Web site: http://j-sainsbury.co.uk

Public Company
Incorporated:
1922 as J. Sainsbury Limited
Employees: 183,000
Sales: £16.27 billion (US$25.68 billion) (2000)
Stock Exchanges: London
Ticker Symbol: SBRY
NAIC: 445110 Supermarkets and Other Grocery (Except Convenience) Stores; 522120 Savings Institutions; 233110 Land Subdivision and Land Development

J Sainsbury plc, widely known in its home nation as Sainsburys, is one of the largest operators of supermarkets in the United Kingdom. There are about 440 Sainsburys stores in the United Kingdom, the largest of which stock more than 23,000 products; 40 percent of the items carry the Sainsburys brand. The Sainsburys chain was once the largest U.K. food retailer, but in the stiffly competitive 1990s Tesco PLC pulled into the lead while ASDA Group Limited, which was purchased by U.S. giant Wal-Mart Stores, Inc. late in the decade, began threatening to drop Sainsburys to number three. J Sainsbury also owns nearly 170 supermarkets in the northeastern United States operating under the Shaws and Star Markets names, while Sainsburys Bank is a joint venture with the Bank of Scotland that runs in-store banks in the United Kingdom offering basic savings accounts, bonds, personal loans, mortgages, and other consumer-oriented financial products. In late 2000 the company was in the process of disposing of two other holdings: the Homebase chain of nearly 300 do-it-yourself (DIY) home centers located throughout the United Kingdom and an 80 percent stake in Sainsburys Egypt, a chain of more than 100 supermarkets and neighborhood stores in and around Cairo. The founding Sainsbury family still maintains a 30 percent stake in the company.

Early History

Sainsburys was off to a romantic but practical start in 1869 when two young employees of neighboring London shops met, married, and started a small dairy store in their three-story Drury Lane home. Mary Ann Staples, 19, had grown up in her fathers dairy business. John James Sainsbury, 25, had worked for a hardware merchant and grocer. Their shop was a success from the start, as both John and Mary Ann had the business knowledge and capacity for hard work that it took to win the loyalty of the local trade. Their passion for order, cleanliness, and highquality merchandise made the shop an inviting place, in contrast to the prevalent clutter of many tiny family-owned shops and the unsanitary conditions of the street vendors stalls and carts.

Seven years later the Sainsburys opened a second shop in a newly developed section of town and moved into the upper portion of the building. Within a few years, they had opened several similar branches, planning to have a shop for each of their sons to manage. By the time their six sons were adults, the branches far outnumbered the family size. Yet caution has always been characteristic of Sainsbury expansion; they regularly passed up opportunities to buy groups or chains of stores, preferring to develop each new store independently.

The passion for high quality led them to a turning point in 1882, when they opened a branch in Croydon. They used advanced design and materials that had an elegance not attempted in the other shops and which made the store easy to keep clean. The walls, floor, and counter fronts were tiled, the countertops were marble slabs. Customers were seated on bentwood chairs. The stores cleanlinessstill a rarity in food shops of that timeand elaborate decor helped attract more prosperous customers; it was an instant success. Several similar shops were added during that decade, while Sainsburys also developed a less elaborate design for suburban branches opened during those years. In these, business could be done through open windows, as in the common market areas, but the design also attracted customers to come into the store to see a greater variety of food.

In 1890, Sainsburys moved its headquarters to Blackfriars, where it remained throughout the 20th century. The location provided easy access to wholesale markets and transportation. To obtain the best quality in food, Sainsburys always kept in close touch with suppliers, and it controlled and distributed stock from a central depot until the 1960s.

Steady Growth in the Early 20th Century

By the beginning of the 20th century sons John Benjamin, George, and Arthur were working in the family business; they and other company employees were trained with equal care and attention to detail. Alfred and Paul went through the same training when they joined the company in 1906 and 1921, respectively. Frank, the third son, took up poultry and pork farming in 1902 and became a major supplier.

During this time, in terms of numbers, rivals seemed to be outdistancing Sainsburys. Liptons, the largest, had 500 stores. It took Sainsburys another 14 years to open its 115th branch. But Sainsburys continued to place the highest priority on quality, taking the time to weigh each decision, whether it meant researching suppliers for a new product, assessing the reliability of a new supplier, or measuring the business potential of a new site.

The outbreak of World War I slowed expansion plans even further. Rationing and shortages of food, particularly fresh produce, led to the creation of grocery departments selling jams, spices, potted meat, and flourall bearing Sainsburys own label. Women began attending the training classes at the Blackfriars headquarters, to replace the male employees who had left for military service. Some worked in the packing plant for Sainsbury-label foods; others served as salespeople in the stores.

Eldest son John Benjamin took much of the initiative in the interwar years, adding new grocery lines while retaining his fathers insistence on high quality. By 1922 there were 136 branches, many of them along the new suburban rail lines, and the firm was incorporated as J. Sainsbury Limited. Mary Ann died in 1927 and her husband in 1928, leaving John Benjamin in charge. By this time, so much public attention accompanied branch openings that when Sainsburys opened a branch in Cambridge, it published an apology in the local newspaper for the impact of a huge opening day crowd. Altogether, 57 new branches were opened between 1919 and 1929, and the gilded glass Sainsbury sign had become a universal symbol of a spacious, orderly interior displaying foods of the finest quality.

There was an apparent break with tradition in 1936 when Sainsburys bought the Thoroughgood stores, a chain of nine shops in Britains Midlands. However, the purchase was made with the same care and emphasis on quality that had distinguished all other Sainsbury branches. Stamford House, which had been built in 1912 as an extension of the headquarters at Blackfriars, was extended to provide more space for the centralized supply procurement and distribution that maintained quality control for all branches, which by this time numbered 244. Specially designed lightweight vans had replaced horse-drawn vehicles, further speeding deliveries.

World War II not only slowed Sainsburys growth through shortages of food and labor, but also brought the stores into the line of fire. Some branches were totally destroyed; others were extensively damaged. Vehicles carrying mobile shops carried on trade as far as possible in the areas affected by the Blitz. Yet the evacuation of bomb-damaged areas made it impossible to continue the centralized procurement and distribution operation that had provided efficiency, economy, and standardization of products and services. Along with other wartime restrictions, this caused sales to dwindle to half the prewar level.

John Benjamins sons Alan and Robert, who had shared the general managers post since their fathers retirement in 1938, became aware of the crucial role of communications during the trying days of this wartime decentralization. The JS Journal, begun in 1946 (and its sister publication, the Employee Report, begun in the late 1970s) exemplified the thorough job of reporting that kept staff members abreast of company developments and business conditions. Both publications have won national awards for excellence.

Postwar Recovery

Long before the last of the wartime restrictions were lifted in 1954, the brothers had begun an aggressive recovery program. Basic operations were recentralized to regain the economies of scale that kept prices down while retaining a substantial profit margin. Alan studied Americas burgeoning supermarkets and opened the first self-service Sainsburys in June 1950 in Croydon, where his grandfather had opened his turning point store nearly 70 years earlier.

Expansion in the 1950s often meant converting existing stores to supermarkets in addition to adding new outlets. In 1955, the 7,500-square-foot Sainsburys at Lewisham was considered the largest supermarket in Europe. By 1969, Sainsbury supermarkets had an average of 10,000 square feet of space. Supermarkets and hypermarkets in the 1980s would triple that amount.

John Benjamin and Arthur were the only two of the founders sons whose own sons joined the family business. Arthurs son James, who had joined the company in 1926, was named Commander of the Order of the British Empire for his accomplishments. He created new factory facilities at Sainsburys headquarters in 1936 and also set up the Haverhill line of meat products.

Company Perspectives:

Sainsburys Supermarkets was established in 1869 by John James and Mary Ann Sainsbury and is Britains longest standing major food retailing chain. The founders principles and values guide us as strongly today as they did at the outsetto be the customers first choice for food shopping by providing high quality, value for money, excellent service, and attention to detail.

John Benjamins sons Alan and Robert, and Alans son John, were also honored for their work. Alan was made Baron Sainsbury of Drury Lane in 1962, and his son John was made Baron Sainsbury of Preston Candover in 1989. Robert was knighted in 1967. Alan and Robert shared the presidency of Sainsburys, John was chairman, and Roberts son David was deputy chairman through the 1980s.

With typical caution, Sainsburys did not actually use the word supermarket in its own communications until the late 1960s, even though it owned almost 100. Nonetheless, the company was at the forefront of new technology. In 1961, for example, Sainsburys became Britains first food retailer to computerize its distribution system. In the late 1980s, electronic cash registers at the checkout counter were replaced by scanners. Multibuy, a special feature of the scanning system, automatically applied a discount to multiple purchases of certain designated items. Spaceman, a microcomputer planning system, used on-screen graphics to plot the allocation of merchandise to specific shelf space in the stores. Electric funds transferred at the point of sale (EFTPOS), allowed customers to use debit cards to make purchases.

Diversifying in the 1970s and 1980s

Sainsburys centenary, 1969, sparked a series of rapid changes. Alans son, John, became chairman of a new management tier, which reported directly to the board of directors. Departmental directors were given greater responsibility for operating functions to strengthen the centralized control that had always been company policy. With ordering, warehousing, and distribution computerized, strict controls on the speeded-up activity were vital. Sainsburys became a public company in 1973, two years after making a name change: the period after the initial J was dropped.

Personnel policies at Sainsburys adhered closely to the principles established at its founding: thorough training, open communication, and continuing training on the job. The company recruited actively at schools and universities, preferring to grow its own talent, but holding employees to high standards of performance. Along with other leading companies and the City University Business School, Sainsburys conducted a practical management course, the Management M.B.A. Sainsburys employees participated in profit sharing and share option schemes.

The companys community involvement was also active, taking many forms. John Sainsbury addressed the London Conference on saving the ozone layer early in 1989. The only retailer invited to take part in the conference and the associated exhibition, he presented details of the technological changes made in Sainsburys aerosol products and plant operations to eliminate chlorofluorocarbons from their operations. Incubation of small start-up businesses, arts sponsorships, and grand-scale charity drives were other ongoing projects.

Forces within the grocery industry compelled Sainsburys to begin a program of diversification within the retail category. Increased competition from discounters threatened to squeeze profit margins. Creeping market saturation and flat population growth combined to intensify competition as well. Sainsburys began to make significant additions to its nonfood merchandise for the first time. The companys first petrol station, a convenience for shoppers, was opened in 1974 at a Cambridge store. To gain the economies of direct supplier-to-store deliveries, Sainsburys formed a joint venture with British Home Stores in 1975, launching a chain of hypermarketshuge stores combining grocery items and hard goodscalled Savacentre; the first Savacentre opened in 1977 in Washington, Tyne and Wear. Sainsburys retained control of all food-related operations, leaving nonfood lines to its partner until 1989, when Savacentre became a wholly owned subsidiary of Sainsburys. Meanwhile, Sainsburys opened a Savacentre hypermarket in Scotland in 1984.

Homebase, a chain of upscale DIY stores, was in the planning stage by 1979. Sainsburys owned 75 percent of this joint venture, and Grand Bazaar Innovations Bon Marché, Belgiums largest retailer (later known as GIB Group), owned the remaining 25 percent. The partners opened their first Homebase home and garden center in 1981, and had expanded the chain to 76 locations by the mid-1990s.

Sainsburys looked to overseas markets for growth opportunities as well. In 1983, the company began to amass shares in Shaws Supermarkets, a New England supermarket chain founded in 1860. Shaws heritage of carrying highquality food at the lowest prices meshed well with the ideals of the British firm. Moreover, like Sainsburys, Shaws had also been at the forefront of computer technology. By 1987, Sainsburys had completed the purchase of 100 percent of the 60 stores in Massachusetts, Maine, and New Hampshire, and had plans to open additional stores in that area.

Challenging Times in the Highly Competitive 1990s

The company boosted its holdings in the United States with the 1994 acquisition of a 50 percent voting stake and 16 percent nonvoting equity in Giant Food Inc., a Washington, D.C.-area chain with 159 stores. Sainsburys increased its nonvoting equity to 20 percent in 1996 and was widely expected to purchase the remaining shares by the end of the decade, but Dutch retailer Royal Ahold N.V. stepped in during 1998 to acquire all of Giant Food.

Key Dates:

1869:
John James and Mary Ann Sainsbury open a small dairy store in their Drury Lane home.
1882:
First branch outside London is opened in Croydon.
1922:
Firm is incorporated as J. Sainsbury Limited.
1936:
The Thoroughgood chain is acquired.
1950:
First self-service Sainsburys opens in Croydon.
1971:
The period after the initial J is dropped from the company name.
1973:
Company goes public as J Sainsbury plc.
1977:
First Savacentre hypermarket opens.
1981:
First Homebase home and garden center is opened.
1987:
Sainsbury gains full control of the U.S. chain Shaws Supermarkets.
1995:
The Texas Homecare chain is acquired from Lad-broke Group.
1997:
Sainsburys Bank is launched.
2000:
Sainsbury agrees to sell Homebase chain and Sainsburys Egypt.

Sainsburys also developed a powerful private-label program. By the mid-1990s, its own-label products generated 66 percent of total sales. Three of the companys proprietary products in particular made headlines in the early 1990s. Novon, a laundry detergent introduced in 1992, marked Sainsburys move into head-to-head competition with national brands. Within just six weeks of Novons launch, the companys share of the detergents market doubled to 20 percent. In 1994, Sainsburys changed the formulation and packaging of its own cola beverage, reintroducing it as Classic Cola. The budget-priced cola featured red cans with italicized letters and a stripe; ads promoted the drinks Original American Taste. Within just a few weeks, Classic Cola won 13 percent of Britains total cola market, while sales of both Coca-Cola and Pepsi at Sainsbury stores plummeted. Not surprisingly, an incensed Coca-Cola demanded that Sainsburys modify its packaging, claiming that the brands similarity prevented customers from discerning between them. The supermarket chain acquiesced, but significantly decreased the rival brands share of shelf space in stores.

Another highly successful, but less confrontational, private-label product also broke new ground for the category. In 1993, the company launched its own periodical, Sainsburys: The Magazine. Like the publications it competed with, Sainsburys: The Magazine featured illustrated pieces on fashion, health, and cooking, as well as national brand advertising. Sold only in Sainsburys supermarkets, the magazine became the most successful new magazine venture in Britain in many years, according to a November 1994 Forbes article.

Under the leadership of Chairman, CEO, and great grandson of the founders David Sainsbury, who took over leadership from his cousin John in 1992, sales tripled from £3 billion in 1985 to £10.6 billion in 1994. During the early 1990s, however, Sainsburys began losing ground to competitors ASDA, Safeway, and Tesco. Perhaps because of arrogance and complacency or the distractions of its forays into the U.S. market and the DIY sector, Sainsburys core U.K. supermarket operations lost their edge in a number of areas, including price, customer service, and innovation. Customers began perceiving, rightly or wrongly, Sainsburys as higher in price than the competition, as offering too many private label products in comparison to name brands, as having insufficient staff to help customers in the aisles, and as having longer checkout lines. Both Tesco and Safeway gained sales through the introduction of loyalty cards, a new marketing practice initially scorned by Sainsburys and then belatedly embraced through the June 1996 launch of the Reward Card. In 1995 Tesco displaced Sainsburys from its perch as the top grocery retailer in the United Kingdom. For the fiscal year ending in February 1996 Sainsburys posted its first profit decline in 22 years.

Among managements first moves aimed at turning the companys fortunes around was a mid-1995 customer service initiative that involved the addition of more than 5,000 staff to man service counters, help customers in the aisles, and pack the groceries. Management changes were also afoot, including the replacement of the marketing director. On the DIY front, meantime, Sainsburys completed the acquisition of the Texas Homecare chain from Ladbroke Group PLC in March 1995 for £290 million. Texas Homecare held 7.6 percent of the U.K. DIY market. With the acquired units slowly being converted to the Homebase brand, Homebase by the late 1990s became the number two DIY chain in the United Kingdom, trailing only B&Q, which was owned by Kingfisher plc. In August 1996 Sainsburys gained full control of Homebase when it bought out its partner in the venture, GIB Group, for £66 million.

In a new attempt at innovation, Sainsburys launched Sainsburys Bank in February 1997, becoming the first supermarket firm to open a fully licensed retail bank. A joint venture 55 percent owned by Sainsbury and 45 percent by Bank of Scotland, Sainsburys Bank initially offered telephone banking services in Sainsbury supermarkets, including two credit cards and two savings accounts. By early 1998 the new bank had 700,000 customer accounts with £1.5 billion on deposit and had begun offering personal loans and mortgages. A whole host of additional financial services were introduced over the new few years. Sainsburys Bank was profitable for the first time in fiscal 2000.

During 1997 Dino Adriano, who had joined Sainsbury in 1964 as a trainee accountant and had previously served as chairman of Homebase, was named group chief executive. Then, in a historic development, David Sainsbury in May 1998 announced his retirement as chairman in order to take on a political appointment as minister for science in Tony Blairs administration. In July 1998 George Bull, who had been serving as chairman of Diageo plc, took over as chairman of Sainsbury, becoming the first nonfamily member to head the company.

Under the new leadership, Sainsburys continued to struggle and faced a new threat from ASDA following its 1998 acquisition by U.S. retailing giant Wal-Mart Stores. While Tesco had largely replaced Sainsburys as the U.K. supermarket chain known for qualityand had thereby become the first choice for most middle- and upper-middle-class shoppersASDA began emphasizing the everyday-low-price scheme of its new parent, quickly becoming the price leader and gaining both working class and middle class customers in the process. Sainsburys seemed to be lost between these two rivals and their respective niches. One response to the ASDA insurgency was Sainsburys low price guarantee launched in October 1999, which promised to match the lowest prices on 1,600 commonly purchased products, including name brand items. Sainsburys also began adding nonfood items to its supermarkets shelves, something its competitors had done several years previous. Needing funds to begin a store remodeling campaign, Sainsburys cut 2,000 jobs from its workforce in 1999.

In contrast to the difficulties of the U.K. supermarket operations, Sainsburys Shaws and Homebase units were thriving. Shaws was bolstered in June 1999 through the acquisition of Star Markets for US$476 million. Star Markets operated in the Greater Boston and Cape Cod areas. A venture into a new foreign territory began in March 1999 when Sainsbury purchased a 25.1 percent stake in Edge SAE, a retail food chain based in Cairo, Egypt. Six months later the stake was increased to 80.1 percent and the company was later renamed Sainsburys Egypt.

Fiscal 2000 proved to be another difficult year for Sainsburys. Profits fell 23 percent as the U.K. supermarkets operations suffered a significant profit decline that far outweighed the strong performance at Shaws and Homebase. This prompted another management shakeup, and in March 2000 Peter Davis took over as chief executive from the retiring Adriano. Davis had most recently been chief executive at Prudential plc, the largest life insurance firm in England, and had served as marketing director at Sainsburys from 1976 to 1986.

Within months of the appointment of Davis, Sainsburys appeared to be moving more quickly and decisively to engineer a turnaround. Davis quickened the pace of restructuring in the U.K. supermarkets, aiming to overhaul the entire store network within three years, rather than the eight years outlined previously. A major cost-cutting campaign that aimed at reducing annual operating expenditures by £600 million was initiated. Perhaps most importantly, Davis was attempting to fashion a successful niche for Sainsburys, aiming to tout the stores quality and range of products and to not compete with Tesco and ASDA on price. This was a risky strategy but Davis had apparently concluded that competing on price played into his competitors strengths.

As this restructuring was being launched, Sainsbury also began pulling back from its diversification program, intending to concentrate on turning around the U.K. supermarkets. In mid-2000 Sainsbury began shopping Homebase around, and in December of that year reached an agreement to sell the home improvement chain for £969 million (US$1.4 billion) in a complex three-way transaction. The Homebase chain itself was slated to go to Schroder Ventures, a U.K. private equity firm, while 28 development sites were to be purchased by Kingfisher, owner of the rival B&Q chain. Sainsbury would also reinvest £31 million in Homebase, resulting in a 17.8 percent stake. By retaining a stake, Sainsbury hoped to profit from a potential sale or IPO involving Homebase. Proceeds from the sale of Home-base were earmarked for the supermarket remodeling program and for upgrading Sainsburys information technology systems as part of the efficiency drive.

Also in December 2000, Sainsbury announced that it had reached an agreement to sell its Egyptian supermarket chain to three Arab companies, who planned to remove the Sainsbury name from the stores. The venture was troubled from the start. Sainsbury had been the first international supermarket chain to enter the Egyptian market and was supported by the Egyptian government, but local supermarket owners were fearful of the new foreign competition and consumers began a boycott believing that Sainsbury would put local shops out of business. In October 2000 an outbreak of violence in the West Bank spread into Egypt when rumors that the Sainsbury chain was connected with Israel circulated, leading to the vandalizing of Sainsbury stores in Cairo. Sainsbury Egypt was also suffering mounting losses.

These disposals would reduce the company to the Sainsburys chain in the United Kingdom, the increasingly successful Salisburys Bank, and Shaws in the United States, the 12th largest U.S. food retailer with annual revenues of about US$4 billion. There was much speculation that Sainsbury would exit the U.S. market as well, but evidence to the contrary surfaced in November 2000 when the company agreed to purchase 18 Grand Union stores in Vermont and Connecticut. One further development in late 2000 was the announcement that Sainsbury would move its headquarters from the Stamford House complex at Blackfriars to Holborn Place in London. This development too was part of Daviss drive to make the company more efficient as the new site would be more modern and would enable a consolidation of a number of key staff within one location. It was becoming ever clearer that the new management at Sainsbury was quickening the pace of change and laying the foundation for a turnaround that would be quite remarkable.

Principal Subsidiaries

Sainsburys Supermarkets Ltd.; J Sainsbury Developments Ltd.; Shaws Supermarkets Inc. (U.S.A.); Sainsburys Bank plc (55%).

Principal Competitors

ASDA Group Limited; Hannaford Bros. Co.; Safeway plc; The Stop & Shop Companies, Inc.; Tesco PLC.

Further Reading

Bagnall, Sarah, How King of the Grocers Was Eased Off Its Throne: Arrogance and Complacency Blamed for Sainsburys Decline, Times (London), May 9, 1996.

Beck, Ernest, Britains Ailing Sainsbury Faces Stark Choice, Wall Street Journal, October 25, 1999, p. A49I.

Bernoth, Ardyn, and Matthew Lynn, Counter Attack: ProfileDavid Sainsbury, Times (London), January 14, 1996.

Brown-Humes, Christopher, Humble Pie on Offer at Sainsbury, Financial Times, May 11, 1996, p. 5.

Buckley, Neil, A Long Shopping List to Regain Lost Momentum: Sainsburys Sales and Margins Have Caused Analysts Concern, Financial Times, November 2, 1995, p. 19.

, Super Service, Financial Times, June 16, 1995, p. 16.

Churchill, David, How Precision Boosts Sainsburys Productivity, Financial Times, January 11, 1982, p. 10.

Cope, Nigel, Checking Out, Management Today, February 2000, pp. 66-71.

Davidson, Andrew, Dino Adriano, Management Today, March 1999, pp. 62+.

De Jonquieres, Guy, and John Thornhill, Family Still Minding the Store, Financial Times, July 1, 1991, p. 30.

East, Robert, The Anatomy of Conquest: Tesco Versus Sainsbury, Kingston Upon Thames, United Kingdom: Kingston Business School, 1997.

The First 120 Years of Sainsburys, 1869-1989, London: Sainsburys, 1989.

Hollinger, Peggy, Politic Departure Ends Six Years in the Chair and Rings Down the Curtain on Six Generations of Sainsburys at the Helm, Financial Times, May 7, 1998, p. 24.

, The Poser for the Pragmatist at Sainsburys, Financial Times, May 31, 2000, p. 30.

, Sainsbury: Supermarkets, Super Margins, Superseded, Financial Times, October 30, 1996, p. 25.

, The Vision to Overcome a Mountain of Problems, Financial Times, June 1, 2000, p. 28.

Hunt, Jonathan, Sainsburys: The Innovative Traditionists, Chief Executive, October 1985, pp. 12+.

JS 100: The Story of Sainsburys, London: Sainsburys, 1969.

Kennedy, Carol, The Merchant Princes: Family, Fortune, and PhilanthropyCadbury, Sainsbury, and John Lewis, London: Hutchinson, 2000, 309 p.

, Public Company, Private Dynasty, Director, December 1992, p. 46.

Marcom, John, Jr., Britains Sainsbury to Buy Rest of Shaws in a Cautious Approach to Growth in U.S., Wall Street Journal, June 22, 1987.

Nicholas, Ruth, Sainsbury Cola Gives in to Coke, Marketing, May 12, 1994, p. 1.

Parkes, Christopher, Fattened Up in Readiness for a New Boston Tea-Party: Sainsbury Set to Take Full Control of Shaws, Financial Times, June 20, 1987, p. 8.

Raghavan, Anita, and Ernest Beck, Sainsbury Enters Talks to Sell Homebase Stores, Wall Street Journal, November 29, 2000, p. A23.

Rogers, David, Britains Supermarkets: An Industry in Turmoil, Supermarket Business, August 1989, p. 37.

Stogel, Chuck, The Once and Future King?, Brandweek, May 8, 1995, p. 34.

Tait, Nikki, From High Road to Main Street, Financial Times, November 20, 1991, p. 20.

Urry, Maggie, Developing Softly Softly Outside the Mainstream, Financial Times, May 20, 1988, p. 12.

Williams, B.R., The Best Butter in the World: A History of Sainsburys, London: Ebury, 1994.

Wilsher, Peer. Housekeeping?, Management Today, December 1993, p. 38.

Zwiebach, Elliot, Sainsbury to Buy 50 Percent of Giants Voting Stock, Supermarket News, October 10, 1994, p. 1.

Betty T. Moore and April Dougal Gasbarre

updated by David E. Salamie

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J Sainsbury plc

J Sainsbury plc

Stamford House
Stamford Street
London SE1 9LL
United Kingdom
(44) 1 71 921-6000
Fax: (44) 1 71 921-6132

Public Company
Incorporated: 1922 as J. Sainsbury Ltd.
Employees: 141,000
Sales: £10.6 billion ($18 billion)
Stock Exchanges: London
SICs: 5411 Grocery Stores; 5210 Lumber and Other Building Materials; 5261 Retail Nurseries and Garden Stores; 6552 Subdividers and Developers, Not Elsewhere Classified; 2030 Preserved Fruits and Vegetables

Supermarkets, hypermarkets, and other grocery outlets clustered tightly in the south of England form the nucleus of Britains largest food and wine retailer: J Sainsbury plc, or Sainsburys, as it is widely known. The companys expansion over a period of 125 years has been cautious but inexorable, accelerating in the latter decades of the century, and reaching overseas in the late 1980s. Unlike many of its competitors which diversified into other business areas to counter the slow growth expected in the retail food industrySainsburys continued to build the retailing businesses in which it excelled.

By the mid-1990s, that empire encompassed over 1,100 retail locations, including the namesake chain of over 340 supermarkets; a controlling stake in the Homebase chain of 76 do-it-yourself retail centers; ten Savacentre hypermarket stores; and Shaws Supermarkets, a chain of 87 supermarkets in the northeast United States. Late in 1994, Sainsburys increased its overseas presence with the purchase of a 50 percent stake in Washington, D.C.s Giant Food Inc., a 159-store supermarket chain.

Sainsburys is not only Britains largest retailer of food and wine but also its most respected, according to nationwide surveys of industry analysts and company directors. The company has earned top or near-top ratings for product and service quality, successful development, profitable pricing, overall financial performance, advertising and marketing, and superior management, as well as recruitment, training, and retention of high-caliber employees. More than one-third of Sainsburys employees own shares in the company.

Sainsburys was off to a romantic but practical start in 1869 when two young employees of neighboring London shops met, married, and started a small dairy store in their three-story Drury Lane home. Mary Ann Staples, 19, had grown up in her fathers dairy business. John James Sainsbury, 25, had worked for a hardware merchant and grocer. Their shop was a success from the start, as both John and Mary Ann had the business knowledge and capacity for hard work that it took to win the loyalty of the local trade. Their passion for order, cleanliness, and high-quality merchandise made the shop an inviting place, in contrast to the prevalent clutter of many tiny family-owned shops and the insanitary conditions of the street vendors stalls and carts.

Seven years later the Sainsburys opened a second shop in a newly developed section of town and moved into the upper portion of the building. Within a few years, they had opened several similar branches, planning to have a shop for each of their sons to manage when he grew up. By the time their six sons were adults, the branches far outnumbered them. Yet caution has always been characteristic of Sainsbury expansion; they regularly passed up opportunities to buy groups or chains of stores, preferring to develop each new store independently.

The passion for high quality led them to a turning point in 1882, when they opened a branch in Croydon. They used advanced design and materials that had an elegance not attempted in the other shops and made the store easy to keep clean. The walls, floor, and counter fronts were tiled, the countertops were marble slabs. Customers were seated on bentwood chairs. The stores cleanlinessstill a rarity in food shops of that timeand elaborate decor helped attract more prosperous customers; it was an instant success. Several similar shops were added during that decade, while Sainsburys also developed a less elaborate design for suburban branches opened during those years. In these, business could be done through open windows, as in the common market areas, but the design also attracted customers to come into the store to see a greater variety of food.

In 1891, Sainsburys moved its headquarters to Blackfriars, where it remained throughout the 20th century. The location provided easy access to wholesale markets and transportation. To obtain the best quality in food, Sainsburys always kept in close touch with suppliers, and it controlled and distributed stock from a central depot until the 1960s.

By the turn of the century sons John Benjamin, George, and Arthur were working in the family business; they and other company employees were trained with equal care and attention to detail. Alfred and Paul went through the same training when they joined the company in 1906 and 1921 respectively. Frank, the third son, took up poultry and pork farming in 1902 and became a major supplier.

During this time, in terms of numbers, rivals seemed to be outdistancing Sainsburys. Liptons, the largest, had 500 stores. It took Sainsburys another 14 years to open its 115th branch. But Sainsburys continued to place the highest priority on quality, taking the time to weigh each decision, whether it meant researching suppliers for a new product, assessing the reliability of a new supplier, or measuring the business potential of a new site.

The outbreak of World War I slowed expansion plans even further. Rationing and shortages of food, particularly fresh produce, led to the creation of grocery departments selling jams, spices, potted meat, and flourall bearing Sainsburys own label. Women began attending the training classes at the Blackfriars headquarters, to replace the male employees who had left for military service. Some worked in the packing plant for Sainsbury-label foods; others served as salespeople in the stores.

Eldest son John Benjamin took much of the initiative in the interwar years, adding new grocery lines while retaining his fathers insistence on high quality. By 1922 there were 136 branches, many of them along the new suburban rail lines, and the firm was incorporated. Mary Ann died in 1927 and her husband in 1928, leaving John Benjamin in charge. By this time, so much public attention accompanied branch openings that when Sainsburys opened a branch in Cambridge, it published an apology in the local newspaper for the impact of a huge opening day crowd. Altogether, 57 new branches were opened between 1919 and 1929, and the gilded glass Sainsbury sign had become a universal symbol of a spacious, orderly interior displaying foods of the finest quality.

There was an apparent break with tradition in 1936 when Sainsburys bought the Thoroughgood stores, a chain of nine shops in Britains Midlands. But the purchase was made with the same care and emphasis on quality that had distinguished all other Sainsbury branches. Stamford House, which had been built in 1912 as an extension of the headquarters at Blackfriars, was extended to provide more space for the centralized supply procurement and distribution that maintained quality control for all branches, which by this time numbered 244. Specially designed lightweight vans had replaced horse-drawn vehicles, further speeding deliveries.

World War II not only slowed Sainsburys growth, through shortages of food and labor, but also brought the stores into the line of fire. Some branches were totally destroyed; others were extensively damaged. Vehicles carrying mobile shops carried on trade as far as possible in the areas affected by the Blitz. But the evacuation of bomb-damaged areas made it impossible to carry on the centralized procurement and distribution operation that had provided efficiency, economy, and standardization of products and services. Along with other wartime restrictions, this caused sales to dwindle to half the prewar level.

John Benjamins sons Alan and Robert, who had shared the general managers post since their fathers retirement in 1938, became aware of the crucial role of communications during the trying days of this wartime decentralization. The JS Journal, begun in 1946 (and its sister publication, the Employee Report, begun in the late 1970s) exemplified the thorough job of reporting that kept staff members abreast of company developments and business conditions. Both publications have won national awards for excellence.

Long before the last of the wartime restrictions were lifted in 1954, the brothers had begun an aggressive recovery program. Basic operations were recentralized to regain the economies of scale that kept prices down while retaining a substantial profit margin. Alan studied Americas burgeoning supermarkets and opened the first self-service Sainsburys in June, 1950 in Croy-don, where his grandfather had opened his turning point store nearly 70 years earlier.

Expansion in the 1950s often meant converting existing stores to supermarkets in addition to adding new outlets. In 1955, the 7,500-square-foot Sainsburys at Lewisham was considered the largest supermarket in Europe. By 1969, Sainsbury supermarkets had an average of 10,000 square feet of space. Supermarkets and hypermarkets in the 1980s would triple that amount.

John Benjamin and Arthur were the only two of the founders sons whose own sons joined the family business. Arthurs son James, who had joined the company in 1926, was named Commander of the Order of the British Empire for his accomplishments. He created new factory facilities at Sainsburys headquarters in 1936 and also set up the Haverhill line of meat products.

John Benjamins sons Alan and Robert, and Alans son John, were also honored for their work. Alan was made Baron Sainsbury of Drury Lane in 1962, and his son John was made Baron Sainsbury of Preston Candover in 1989. Robert was knighted in 1967. Alan and Robert shared the presidency of Sainsburys, John was chairman, and Roberts son David was deputy chairman through the 1980s.

With typical caution, Sainsburys did not actually use the word supermarket in its own communications until the late 1960s, even though it owned almost 100. Nonetheless, the company was at the forefront of new technology. In 1961, for example, Sainsburys became Britains first food retailer to computerize its distribution system. In the late 1980s, electronic cash registers at the checkout counter were replaced by scanners. Multibuy, a special feature of the scanning system, automatically applied a discount to multiple purchases of certain designated items. Spaceman, a microcomputer planning system, used on-screen graphics to plot the allocation of merchandise to specific shelf space in the stores. Electric funds transferred at the point of sale (EFTPOS), allowed customers to use debit cards to make purchases.

Sainsburys centenary, 1969, sparked a series of rapid changes. Alans son, John, became chairman of a new management tier, which reported directly to the board of directors. Departmental directors were given greater responsibility for operating functions to strengthen the centralized control that had always been company policy. With ordering, warehousing, and distribution computerized, strict controls on the speeded-up activity were vital. Sainsburys became a public company in 1973, two years after making a name change: the period after the initial J was dropped.

Personnel policies at Sainsburys adhered closely to the principles established at its founding: thorough training, open communication, and continuing training on the job. The company recruited actively at schools and universities, preferring to grow its own talent, but holding employees to high standards of performance. Along with other leading companies and the City University Business School, Sainsburys conducted a practical management course, the Management MBA. Sainsburys employees participated in profit sharing and share option schemes.

The companys community involvement was also active, taking many forms. John Sainsbury addressed the London Conference on saving the ozone layer early in 1989. The only retailer invited to take part in the conference and the associated exhibition, he presented details of the technological changes made in Sainsburys aerosol products and plant operations to eliminate chlorofluorocarbons from their operations. Incubation of small start-up businesses, arts sponsorships, and grand-scale charity drives were other ongoing projects.

Forces within the grocery industry compelled Sainsburys to begin a program of diversification within the retail category. Increased competition from discounters threatened to squeeze profit margins. Creeping market saturation and flat population growth combined to intensify competition as well. Sainsburys began to make significant additions to its nonfood merchandise for the first time. The companys first petrol station, a convenience for shoppers, was opened in 1974 at a Cambridge store. To gain the economies of direct supplier-to-store deliveries, Sainsburys formed a joint venture with British Home Stores in 1975, launching a chain of hypermarketshuge stores combining grocery items and hard goodscalled Savacentre. Sainsburys retained control of all food-related operations, leaving nonfood lines to its partner until 1988, when Savacentre became a wholly owned subsidiary of Sainsburys.

Homebase, a chain of upscale do-it-yourself stores, was in the planning stage by 1979. Sainsburys owned 75 percent of this joint venture, and Grand Bazaar Innovations Bon Marché, Belgiums largest retailer, owned the remaining 25 percent. The partners opened their first Homebase home and garden center in 1981, and had expanded the chain to 76 locations by the mid-1990s.

Sainsburys looked to overseas markets for growth opportunities as well. In 1983, the company began to amass shares in Shaws Supermarkets, a New England supermarket chain. Founded in 1860, Shaws heritage of carrying high-quality food at the lowest prices meshed well with the ideals of the British firm. And like Sainsburys, Shaws has also been at the forefront of computer technology. By 1987, Sainsburys had completed the purchase of 100 percent of the 60 stores in Massachusetts, Maine, and New Hampshire, and had plans to open additional stores in that area. The company boosted its holdings in the United States with the 1994 acquisition of 50 percent of Giant Food Inc., a Washington, D.C.-area chain. Sainsburys was expected to purchase the remaining shares of the 159-store chain by the end of the decade. Closer to home, Sainsburys opened a Savacentre hypermarket in Scotland in 1984.

Sainsburys also developed a powerful private-label program. By the mid-1990s, its own-label products generated 66 percent of total sales. Three of the companys proprietary products in particular made headlines in the early 1990s. Novon, a laundry detergent introduced in 1992, marked Sainsburys move into head-to-head competition with national brands. Within just six weeks of Novons launch, the companys share of the detergents market doubled to 20 percent. In 1994, Sainsburys changed the formulation and packaging of its own cola beverage, reintroducing it as Classic Cola. The budget-priced cola featured red cans with italicized letters and a stripe; ads promoted the drinks Original American Taste. Within just a few weeks, Classic Cola won 13 percent of Britains total cola market, while sales of both Coca-Cola and Pepsi at Sainsbury stores plummeted. Not surprisingly, an incensed Coca-Cola demanded that Sainsburys modify its packaging, claiming that the brands similarity prevented customers from discerning between them. The supermarket chain acquiesced, but significantly decreased the rival brands share of shejf space in stores.

Another highly successful, but less confrontational, private-label product also broke new ground for the category. In 1993, the company launched its own periodical, Sainsburys: The Magazine. Like the publications it competed with, Sainsburys: The Magazine featured illustrated pieces on fashion, health, and cooking, as well as national brand advertising. Sold only in Sainsburys supermarkets, the magazine became the most successful new magazine venture in Britain in many years, according to a November 1994 Forbes article.

While other family-run firms have encountered problems with succession or overly conservative management, Sainsburys innovative marketing, aggressive international expansion, and cautious borrowing seemed to portend a promising future for the company. Under the leadership of Chairman, CEO, and great grandson of the founders David Sainsbury in the early 1990s, sales had tripled from £3 billion in 1985 to £10.6 billion in 1994. Net income more than quintupled from £108 million in 1985 to £503 million in 1993, then plunged to £142 million the following year.

Principal Subsidiaries

Homebase Ltd. (75%); J Sainsbury Developments Ltd.; J Sainsbury (Channel Islands) Ltd.; Savacentre Ltd.; Shaws Supermarkets, Inc. (U.S.); Giant Foods Inc. (50%) (U.S.).

Further Reading

The First 120 Years of Sainsburys, 18691989, London: Sainsburys, 1989.

JS 100: The Story of Sainsburys, London: Sainsburys, 1969.

Nicholas, Ruth, Sainsbury Cola Gives in to Coke, Marketing, May 12, 1994. p. 1.

Rogers, David, Britains Supermarkets: An Industry in Turmoil, Supermarket Business, August 1989, p. 37.

Stogel, Chuck, The Once and Future King?, Brandweek, May 8, 1995, p. 34.

Williams, B. R., The Best Butter in the World: A History of Sainsburys, London: Ebury, 1994.

Wilsher, Peer. Housekeeping?, Management Today, December 1993, p. 38.

Zwiebach, Elliot, Sainsbury to Buy 50 percent of Giants Voting Stock, Supermarket News, October 10, 1994, p. 1.

updated by April Dougal Gasbarre

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J Sainsbury PLC

J Sainsbury PLC

Stamford House
Stamford Street
London SE1 9LL
United Kingdom
(1) 921-6000

Public Company
Incorporated:
1922 as J. Sainsbury Ltd.
Employees: 82,000
Sales: £5 billion (US$9.04 billion)
Stock Index: London

Supermarkets, hypermarkets, and other grocery outlets clustered tightly in the south of England form the nucleus of Britains largest food and wine retailer: J Sainsbury plc, or Sainsburys, as it is widely known. The companys expansion over a period of 120 years has been cautious but inexorable, accelerating in the past two decades, and recently venturing overseas. Unlike other major food companies that have diversified into other business areas to counter the slow growth expected in the food market, Sainsburys is simply building the retailing business in which it excels.

Sainsburys is not only Britains largest retailer of food and wine but also its most respected, according to nationwide surveys of city analysts and company directors. The company has earned top or near-top ratings for product and service quality, successful development, profitable pricing, overall financial performance, advertising and marketing, superior management, and recruitment, training, and retention of high-caliber employees. More than a third of Sainsburys employees own shares in the company.

Sainsburys was off to a romantic but practical start in 1869 when two young employees of neighboring London shops met, married, and started a small dairy store in their three-story Drury Lane home. Mary Ann Staples, 19, had grown up in her fathers dairy business. John James Sainsbury, 25, had worked for a hardware merchant and grocer. Their shop was a success from the start, as both John and Mary Ann had the business knowledge and capacity for hard work that it took to win the loyalty of the local trade. Their passion for order, cleanliness, and high-quality merchandise made the shop an inviting place, in contrast to the prevalent clutter of many tiny family-owned shops and the insanitary conditions of the street vendors stalls and carts.

Seven years later the Sainsburys opened a second shop in a newly developed section of town and moved into the upper portion of the building. Within a few years, they had opened several similar branches, planning to have a shop for each of their sons to manage when he grew up. By the time their six sons were adults, the branches far outnumbered them. Yet caution has always been characteristic of Sainsbury expansion; they regularly passed up opportunities to buy groups or chains of stores, preferring to develop each new store independently.

The passion for high quality led them to a turning point in 1882, when they opened a branch in Croydon. They used advanced design and materials that had an elegance not attempted in the other shops and made the store easy to keep clean. The walls, floor, and counter fronts were tiled, the countertops were marble slabs. Customers were seated on bentwood chairs. The stores cleanlinessstill a rarity in food shops of that timeand elaborate decor helped attract more prosperous customers; it was an instant success. Several similar shops were added during that decade, while Sainsburys also developed a less elaborate design for suburban branches opened during those years. In these, business could be done through open windows, as in the common market areas, but the design also attracted customers to come into the store to see a greater variety of food.

In 1891, Sainsburys moved its headquarters to Black-friars, where it remains. The location provided easy access to wholesale markets and transportation. To obtain the best quality in food, Sainsburys has always kept in close touch with suppliers, and it controlled and distributed stock from a central depot until the 1960s.

By the turn of the century sons John Benjamin, George, and Arthur were working in the family business; they and other company employees were trained with equal care and attention to detail. Alfred and Paul went through the same training when they joined the company in 1906 and 1921 respectively. Frank, the third son, took up poultry and pork farming in 1902 and became a major supplier. By the turn of the century, in terms of numbers, rivals seemed to be outdistancing Sainsburys. Liptons, the largest, had 500 stores. It took Sainsburys another 14 years to open its 115th branch. But Sainsburys continued to place the highest priority on quality, taking the time to weigh each decision, whether it meant researching suppliers for a new product, assessing the reliability of a new supplier, or measuring the business potential of a new site.

The outbreak of World War I slowed expansion plans even further. Rationing and shortages of food, particularly fresh produce, led to the creation of grocery departments selling jams, spices, potted meat, and flourall bearing Sainsburys own label. Women began attending the training classes at the Blackfriars headquarters, to replace the male employees who had left for military service. Some worked in the packing plant on Sainsbury-label foods; others served as salespeople in the stores.

Eldest son John Benjamin took much of the initiative in the postwar years, adding new grocery lines while retaining his fathers insistence on high quality. By 1922 there were 136 branches, many of them along the new suburban rail lines, and the firm was incorporated. Mary Ann died in 1927 and her husband in 1928, leaving John Benjamin in charge. By this time, so much public attention accompanied branch openings that when Sainsburys opened a branch in Cambridge, it published an apology in the local newspaper for the impact of a huge opening day crowd. Altogether, 57 new branches were opened between 1919 and 1929, and the gilded glass Sainsbury sign had become a universal symbol of a spacious, orderly interior displaying foods of the finest quality.

There was an apparent break with tradition in 1936 when Sainsburys bought the Thoroughgood stores, a chain of nine shops in Britains Midlands. But the purchase was made with the same care and emphasis on quality that had distinguished all other Sainsbury branches. Stamford House, which had been built in 1912 as an extension of the headquarters at Blackfriars, was extended to provide more space for the centralized supply procurement and distribution that maintained quality control for all branches, which by this time numbered 244. Specially designed lightweight vans had replaced horse-drawn vehicles, further speeding deliveries.

World War II not only slowed Sainsburys growth, through shortages of food and labor, but also brought the stores into the line of fire. Some branches were totally destroyed; others were extensively damaged. Vehicles carrying mobile shops carried on trade as far as possible in the areas affected by the Blitz. But the evacuation of bomb-damaged areas made it impossible to carry on the centralized procurement and distribution operation that had provided efficiency, economy, and standardization of products and services. Along with other wartime restrictions, this caused sales to dwindle to half the prewar level.

John Benjamins sons Alan and Robert, who had shared the general managers post since their fathers retirement in 1938, became deeply aware of the crucial role of communications during the trying days of this wartime decentralization. The JS Journal, begun in 1946 (and its sister publication, the Employee Report, begun in the late 1970s) exemplifies the thorough job of reporting that to this day keeps staff members abreast of company developments and business conditions. Both publications have won national awards for excellence.

Long before the last of the wartime restrictions were lifted in 1954, the brothers had begun an aggressive recovery program. Basic operations were recentralized to regain the economies of scale that kept prices down while retaining a substantial profit margin. Alan studied Americas burgeoning supermarkets and opened the first self-service Sainsburys in June, 1950 in Croydon, where his grandfather had opened his turning point store nearly 70 years earlier.

Expansion in the 1950s often meant converting existing stores to supermarkets in addition to adding new outlets. In 1955, the 7,500-square-foot Sainsburys at Lewisham was considered the largest supermarket in Europe. By 1969, Sainsbury supermarkets had an average of 10,000 square feet of space. Todays supermarkets and hypermarkets have tripled that amount.

John Benjamin and Arthur were the only two of the founders sons whose own sons joined the family business. Arthurs son James, who had joined the company in 1926, was named Commander of the Order of the British Empire for his accomplishments. He created new factory facilities at Sainsburys headquarters in 1936 and also set up the Haverhill line of meat products.

John Benjamins sons Alan and Robert, and Alans son John, were also honored for their work. Alan was made Baron Sainsbury of Drury Lane in 1962, and his son John was made Baron Sainsbury of Preston Candover in 1989. Robert was knighted in 1967. Today Alan and Robert share the presidency of Sainsburys, John is chairman, and Roberts son David is deputy chairman.

With typical caution, Sainsburys did not actually use the word supermarket in its own communications until the late 1960s, even though it owned almost a hundred. Nonetheless, the company was at the forefront of new technology. In 1961, for example, Sainsburys became the first food retailer to computerize its distribution system. In the late 1980s, electronic cash registers at the checkout counter were replaced by scanning. Multibuy, a special feature of the scanning system, automatically applies a discount to multiple purchases of certain designated items. Spaceman, a microcomputer planning system, uses on-screen graphics to plot the allocation of merchandise to specific shelf space in the stores. EFTPOS, an electronic funds transfer system, allows customers to use debit cards to make purchases.

Sainsburys centenary, 1969, sparked a series of rapid changes. Alans son, John, became chairman of a new management tier, which now reported directly to the board of directors. Departmental directors were given greater responsibility for operating functions to strengthen the centralized control that had always been company policy. With ordering, warehousing, and distribution computerized, strict controls on the speeded-up activity were vital. Sainsburys became a public company in 1973, two years after making a name change: the period after the initial J was dropped.

In the 1970s Sainsburys began to make significant additions to its nonfood merchandise for the first time. The companys first petrol station, a convenience for shoppers, was opened in 1974 at a Cambridge store. To gain the economies of direct supplier-to-store deliveries, Sainsburys formed a joint venture with British Home Stores in 1975, launching a chain of hypermarkets called Savacentre. Sainsburys retained control of all food-related operations, leaving nonfood lines to its partner until 1988, when Savacentre became a wholly owned subsidiary of Sainsburys.

Homebase, another chain, was in the planning stage by 1979. In 1981, the first Homebase home and garden center was opened. Sainsburys owns 75% of Homebase; the other 25% is owned by GB-Inno-BM, the largest Belgian retailer, known for its worldwide leadership in merchandising products for do-it-yourselfers.

In 1983, Sainsburys began to acquire an interest in Shaws Supermarkets, a New England supermarket chain. Shaws was founded in 1860, and has a similar history of high-quality food at the lowest prices obtainable through efficiency of management and distribution. And like Sainsburys, Shaws has also been at the forefront of computer technology. By 1987, Sainsburys had completed purchase of 100% of the 60 stores in Massachusetts, Maine, and New Hampshire, and had plans to open additional stores in that area.

Personnel policies at Sainsburys have adhered closely to the principles established at its founding: thorough training, open communication, and continuing training on the job. The company recruits actively at schools and universities, preferring to grow its own talent, but holding employees to high standards of performance. With other leading companies and the City University Business School, Sainsburys conducts a practical management course, the Management MBA. Sainsburys employees participate in profit sharing and share option schemes.

The companys community involvement has been active, taking many forms. John Sainsbury addressed the London Conference on saving the ozone layer early in 1989. The only retailer invited to take part in the conference and the associated exhibition, he presented details of the technological changes made in Sainsburys aerosol products and plant operations to eliminate chlorofluorocarbons from their operations. (Sainsburys high-quality private-label products are a booming business.) Incubation of small start-up businesses, arts sponsorships, and grand-scale charity drives are other ongoing projects.

John James Sainsburys principles and passions are alive and well, and continuing to foster cautious growth under the leadership of the family businesss fourth generation. The company and family continue to control the majority of shares, and management seems intent on continuing the practices that have brought it success.

Principal Subsidiaries:

Homebase Ltd. (75%); J Sainsbury Properties Ltd.; J Sainsbury Farms Ltd.; The Cheyne Investments Ltd.; The Cheyne Investments, Inc. (USA); The Sainsbury Charitable Fund Ltd.; J Sainsbury (Finance) B.V. (Netherlands); Savacentre Ltd.; Shaws Supermarkets, Inc. Associates; Haverhill Meat Products Ltd. (50%); Breckland Farms Ltd. (50%); Kings Reach Investments Ltd. (28.76%).

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"J Sainsbury PLC." International Directory of Company Histories. 1990. Encyclopedia.com. 27 Jul. 2016 <http://www.encyclopedia.com>.

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