‘As cheap as we can’: Discount supermarket eyes expansion during cost-of-living crisis

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As Australia’s grocery operators jostle to provide value to households being squeezed by the cost-of-living crisis, discount supermarket NQR has one simple focus.

“The goal of the business is to buy things as cheap as we can, sell things as cheap as we can,” said chief executive Ewan Jones.

Ewan Jones says NQR’s offer of deep discounting is resonating with customers under pressure.

“Our stores won’t be the prettiest stores in history [but] they will be the cheapest by far.”

The discount supermarket, which has been in operation since 1987 and was previously also known as Not Quite Right, has collapsed twice in the past two decades, most recently in 2018. 

But NQR’s current owners, a group of investors – including retail veterans who have worked at other budget chains, such as The Reject Shop – say the time is right for the company to be back on the expansion path.

Two new stores are planned for Victoria this year, at Box Hill and Mount Waverley, as well as new sites across South Australia. There are no stores in New South Wales or Queensland yet, but the group’s online platform ships nationally. The business has grown to a network of 23 stores.

Jones says the business has worked hard to rebrand itself over the past few years, broadening its range of stock and emphasising that it sells high-quality products.

“If you ask any customer, they’d say ‘Oh they only sell out-of-date [products]’. That’s not actually the case,” he said.

Instead, NQR’s experienced team of product buyers are “wheeling and dealing all day and all night”, sourcing products that are close to their use-by dates, or that a supplier might need to sell at a good price for other reasons, despite the products being good quality.

“Our buyers are very in tune with that market,” Jones said.

Australian shoppers are grappling with soaring prices for staple products.Credit: iStock

The group’s promise of well-known brands sold at up to 80 per cent of their recommended retail price is gaining new traction in an environment where the price of everyday pantry staples are skyrocketing.

Price tracker data from investment bank UBS suggested overall food inflation hit its peak in April, averaging 9.6 per cent.

Jones says NQR has an important role to play in the current grocery landscape, and takes its promise to budget-focused shoppers seriously.

“There’s a specific market for our kind of product. There are some people who just won’t shop with us; they feel like in their mind it’s too low for them … that’s OK with us. We’re there for people who really need us,” he said.

“They talk to us about it all the time, [and say] ‘we’re so glad you’re here, I couldn’t afford to eat if you weren’t here’. We have a bit of responsibility at that end to look after them.”

As the company looks to expand its range, everyday pantry essentials and snacks are a top priority, with frozen products and snacks, such as chips, flying off the shelves.

“Dry grocery is the one where people are really struggling at the moment; that’s where you’re seeing the most growth,” Jones said.

The business also wants to play a role in reducing food waste at a time when many people are experiencing food insecurity.

“We consider what we are doing for the market is really strong, [because] things aren’t just being thrown out because they are short-dated, but still can be sold.”

While NQR stores have traditionally been placed in regional and outer suburban centres, Jones says there’s a place for the brand in CBDs, too.

“I’d love to be around Spencer Street [Melbourne]. There’s a lot of people in the city – do they deserve cheaper groceries? Yes, because they’re probably paying top dollar in the city.”

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