Sainsbury’s chief executive Mike Coupe faces a fight for his job after the Competition and Markets Authority ruled against his proposed £12 billion merger with Asda that would have created a supermarket giant bigger than Tesco and supposedly better equipped to face down the discounters Aldi and Lidl. The CMA said the deal would have harmed competition and pushed up prices, ignoring Coupe’s claims to the contrary. Investors were also unconvinced, having endured limp profits and a downward–drifting share price during Coupe’s five-year tenure.
The truth about Sainsbury’s is that its success was built on the dedicated ‘retail is detail’ focus of its founding family: that’s also how Coupe’s predecessor, Justin King, succeeded in delivering 36 consecutive quarters of sales growth. As I reported when King stood down: ‘Groceries up-front, gleaming fish, spacious aisles, helpful staff… a palpable targeting of middle-class shoppers who demand a balance of quality and value.’ Instead, Coupe chased deals, his only real win being the smaller takeover of Argos. The new Sainsbury’s chairman, Martin Scicluna, says: ‘One hundred per cent, he’s got my support.’ But watch this space — there might soon be a vacancy for a chief executive who just wants to be a good grocer.