The Tigger approach

People on tighter budgets are more concerned about the quality and ethics of what they buy, because their money is more precious, Justin King, Sainsbury’s ebullient chief executive, tells Ben Laurance

Justin King refuses to be gloomy. Other retailers may be moaning like mad about their lot, but King, 46-year-old chief executive of J Sainsbury displays a Tigger-ish enthusiasm for the company’s current performance and its prospects.

‘I don’t think I’m being blasé about the current environment,’ says King. ‘But I feel very strongly that we have this incredible ability to talk ourselves into a hole of our own making. Retailing is an industry that rides on sentiment. When people are feeling positive and bouncy, they do perhaps spend more than is good for them, but the opposite is also true: a lot of the commentary when this downturn started was massively overplaying how serious it was. It was self-serving: people were talking things down to talk down expectations of their own businesses’ performance. To an extent, it becomes a self-fulfilling prophecy.’

Well, hang on. Consumers are being hit by sharp increases in the price of such staples as fuel – and, indeed, in the price of food that Sainsbury’s and its competitors sell in such vast quantities. Mortgages are more expensive than a year ago. The most recent unemployment figures suggest that the number of people out of a job is starting to rise. Isn’t King being just a little bit blasé?

Not at all, he insists. Statistics suggest that food prices have risen by more than 9 per cent since last summer. But food inflation is very ‘lumpy’, says King. ‘Yes, rice is twice the price it was a year ago, but potatoes are 30 per cent cheaper. I could show you a shopping basket of goods that you’d be quite happy to buy to feed your family this week from our top 200-selling lines, and that basket would be 20 per cent cheaper than a year ago.’

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