From diversification to food focus
Sainsbury's has gradually moved from being a multi-faceted high street retailer to a business that focuses on groceries. This change started in 2016 when the company bought Argos and Habitat as part of its effort to spread out beyond just selling food. At that time, Argos had 845 stores of its own, offering items like technology gadgets, toys, and household goods. However, by the start of the pandemic, that number had already dropped to 573. The decline continued quickly once Simon Roberts became in charge in June 2020. He announced the closure of 420 more standalone stores. When Sainsbury's finally sold Argos to Swift, only 201 physical Argos stores remained open, while 466 were still inside larger Sainsbury's locations.
The Habitat business, which sells furniture and home accessories, has followed a similar path. It was part of the 2016 deal when Sainsbury's purchased Argos. At that time, Habitat had three standalone stores and 84 mini-shops located within Homebase. Sainsbury's briefly grew Habitat's presence after the 2016 purchase, opening two more standalone shops in 2018. However, by 2020, it was back to just three stores. By 2023, all of those were gone, leaving only small in-store shops and online sales. Russ Mould from AJ Bell said the original purchase was intended to help Sainsbury's avoid relying too much on groceries. He added that the company has often tried to do many things but has returned to focusing on selling food and essentials to households. Chris Beauchamp from IG agreed, saying that Argos felt like an old idea that no longer fits the current strategy.
Cost of transformation
The changes Sainsbury's has made have come with a heavy price in terms of jobs. In 2020, when Roberts took control, he announced the loss of 3,500 jobs. This was partly because of the closing of many Argos standalone stores and also because of the closure of Sainsbury's meat, fish, and deli counters. The following year, another 1,400 jobs were lost when two Argos warehouses shut down. In 2024, another 1,500 roles were at risk as bakeries and a call centre were closed. By 2025, all 61 in-store cafés, patisseries, and pizza counters were closed, cutting 3,000 more jobs. This February, 300 additional jobs were lost due to the restructuring of the tech team and Argos deliveries, bringing the total number of planned cuts to 9,700.
The job losses have been part of a broader strategy to reduce Sainsbury's physical presence and refocus on its core grocery business. This has involved selling parts of the company that are not directly related to food, such as the financial services arm and other retail divisions. The company has also closed many in-store facilities that were once part of the high street experience.
Disbanding of financial services
Sainsbury's financial services were dismantled step by step. In 2024, NatWest bought the company's personal loan, credit card, and retail deposit business for £125 million. The following year, the travel money service was sold to Fexco, and Allianz UK took over car and home insurance for existing customers. This meant Sainsbury's no longer offered personal financial products through its own channels. The company had previously said it still wanted to keep ATMs, travel money, and insurance services because they were profitable and related to its main retail business. However, within three months, its 1,370 ATMs were sold to a company called NoteMachine. Sainsbury's had also said that these services were not being sold, but the company quickly changed its mind. In 2025, it sold the travel money business to an Irish firm named Fexco and handed over car and home insurance to Allianz UK for current customers.
By the end of 2025, the Qatar Investment Authority had sold its stake in Sainsbury's, ending almost 20 years as the company's biggest shareholder. With the sale of Argos and the dismantling of financial services, Sainsbury's now appears to be close to completing its return to a food-first model. The company's core supermarket estate has stayed mostly the same, with 609 supermarkets and 885 convenience stores as of now, a slight increase from 598 and 813 in 2020/21. Sainsbury's even bought 10 Homebase stores to fit them out as part of its own operations after exiting the standalone store model. However, Sainsbury's no longer owns Homebase. The home improvement and furniture store had 283 stores when it was sold in 2000, but by 2020, that number had dropped to 135 after an Australian company called Wesfarmers bought the business. This company then fired all senior and middle managers, taking away important local expertise. Homebase eventually went bankrupt last year.
Sainsbury's isn't the only company making this shift. Tesco is also looking to sell its operations in Hungary, the Czech Republic, and Slovakia. M&S is focusing on becoming the go-to place for customers' weekly food shop, planning to close larger clothing stores and shift sales to online platforms. While the trend is to return to core businesses, the urge to diversify hasn't fully disappeared. Sainsbury's launched a charging service for electric vehicles in 2024, and Tu and Habitat are still present in its larger stores.