More reasons...to own Morrisons shares

Interesting board, never read it before.

I maintain one Supermarket share in our Sas, and use a thoroughly un-city but fairly scientific process to decide on which one to hold at any time. Having made reasonable profits in the past on all of the Supermarkets in varying orders, I am currently in Morrison at a slight loss, but definitely holding.

The method is quite simply listening to wives' discussions at dinner parties when they get round to Supermarkets, which they always do and, where areas of uncertainty arise, looking at the specific areas of comment on shopping trips. We have Sainsbury's, Somerfield and Morrison (converted Safeway) in our town, regular 'contributors' to the arguments have mixes of Tesco/Sainsbury/Morrison/Somerfield in their towns, and we all have access to an Asda superstore within 15 miles. Interestingly we are all served by what I now call the 'rebel' distribution network, of which a little later.

So why Morrison? Well, for years Safeway was always popular with the wives who regularly shopped there, if not exclusively, but lost all of them within three months of the takeover. This was because the offering in terms of quality and reliability of stock just evaporated before their eyes. Some went to Sainsbury's, others to Tesco. All use Somerfield for top-up purchases and Asda for occasional 'Supershops' as their day-out expeditions are called, where the purchases are quite heavily weighed towards non-food. Those that migrated to Sainsbury's rated it 'OK', whereas those who migrated to Tesco thought it was 'terrific'. I was in Sainsbury at the time, and switched to Tesco with excellent results as both shares went in opposite directions.

What was interesting was that some of the wives kept trying Safeway/Morrison as the conversions went through, with mixed reactions, but they clearly missed using the stores despite the prowess of their respective replacements, and some began to ask questions of staff as to why it was going so wrong. Most thought it must be the application of 'Northern' price/value standards, but discovered that there seemed to be problems with distribution, and that when staff were prepared to speak openly, the impression was gained that there was 'Southern' resistance by Safeway staff to the takeover, and that it was the distribution organisation that was behaving somewhat more militantly. Of course this was based entirely on tittle-tattle, but it was interesting that this came to my notice before the public admission of 'teething-problems' in the merged distribution organisation.

Anyway, this subliminal loyalty to old Safeway has now resulted in all returning to the now established converted Morrison stores, and although not all use them exclusively, they all have them back as first choice, and find not only the reliability of stocks vastly improved, but the quality of goods better than pre-conversion, especially the fresh meat and fish. One went as far last week to describe her local Tesco as 'dreadful over Christmas', something that I have never heard before. As another interesting aside, M&S food (which always features more at this time of year than any other) performance this year is considered 'fabulous', the highest praise they have achieved in probably five years, and having tasted some of the results, I have to agree!

So for me, Morrison is a definite hold, and it will be interesting to see whether the official Post-Xmas announcements are closer to what I hear from my current research, than that of the supposedly more scientific, and jaundiced, analysts. Obviously this is all IMHO, so DYOR and have a prosperous New Year.