Pete Cheema: the SGF chief talks shops

Pete Cheema, chief executive of the Scottish Grocers’ Federation (SGF), was Asian Trader of the Year in 2006. Carrying on the family tradition, his son, Anand, won Impulse Retailer of the Year at the same awards 15 years later.

Anand is a chip off the not-so-old block, and so is his shop, which is on the site of one of Pete’s early Scottish enterprises, and Pete is clearly very proud of him.

“He’s done well – the store’s absolutely flying, doing double the turnover we thought it would be doing at this time,” Pete explains. “He’s come up with some really great ideas like selling cocktails. There’s not many stores doing that kind of stuff, you know, just basically figuring out that this is what people are missing out on, so can we do it?” – an attitude that has led to Pete’s success and prominence in Scottish business and, increasingly, political life.

Pete Cheema lives in beautiful Stirling, central Scotland, where he is a long-time pillar of the community and was recently awarded an honorary doctorate by the University there. It’s a long way from Wolverhampton, where he was born, and Kent, where he spent his childhood. But it’s even further from Indian Punjab.

“My father’s originally from northwest of India, from a Sikh family,” says Pete. His father was a pioneer, one of the first South Asians to settle in the UK after the war, arriving in 1951 following a year in Singapore. “He was one of the first few in Wolverhampton, and my mum, brother and sister came over in about 1958. I was probably an afterthought when I was born in 1964.”

Pete’s dad worked as a labourer, in the days before Health and Safety was a thing, and suffered a (second) terrible accident while helping to build the M25, when he was was crushed between a tractor and a wall. Cheema senior survived, but Pete – then studying finance and on the management track at Barclays Bank – promptly quit his job and moved to Scotland, taking his parents with him, after buying a “really rundown” Stirling grocery store (“My wife and I ran the business and we had ready-made baby-sitters”).

He says that the abrupt career change was both emotional – he was angry over his father’s plight and vowed that he would never again work for anybody else –but also financial: he wanted to make money.

England may not have been a multi-racial paradise in the 1980s, but Pete was unprepared for what faced him as an Asian in Stirling, where there were only four other Indian families at the time.

Old time racism; Pete’s new bill

“Oh, crikey!” he laughs, the disbelief still fresh. “The shock was absolutely huge.The culture was totally different.” In part it was the language: “A customer would ask for a poke and I was thinking, why would you want a poke? But what it really meant was a carrier-bag.” But mostly it was the racism.

“The racism up here was terrible. That was a huge shock. It was still rife in England but it was much worse in Scotland. I’d never heard the word ‘Paki’ in Gravesend, where we lived in Kent.”

We are talking about racism because Pete has a fascinating take on why racism was so decisively “defeated” by a piece of legislation – namely Westminster’s Race Relations (Amendment) Act in 2000 – and why the same legal medicine could work for the violence against shopkeepers now that Pete and the Scottish Grocers’ Federation have succeeded with getting their Protection of Shopkeepers Private Member’s bill through the Scottish parliament at Holyrood.

“The Race Relations (Amendment) Act 2000 was a huge change after it got Royal Assent,” says Pete. “One of the reasons was that the police actually started to collect statistics. Beforehand, racism was not recorded, but then when it was, they had to treat it as a serious crime. And that’s something I’ve been adamant about with the Protection of Shopkeepers, because we’re in the same position, where retail crime doesn’t really get recorded here in Scotland.

“If you ask the police how many people phone up regarding retail crime, they can’t tell you. So number one, we need to get it recorded. Number two, we need to get it taken seriously. And number three, if, for example, somebody called me a Paki bastard on a Friday and I call the police, they had to respond straight away. That’s treating it as a serious crime. And therefore they had to detain the person over the weekend until he got presented to the court on the Monday morning.”

The new Protection of Shopkeepers bill will do the same for criminals who assault shop staff, and when crimes of violence and abuse against retail staff are recorded officially in police statistics, budgets will have to be allocated to dealing with the problem, just as they were with racism two decades ago. The cultural shift rapidly follows.

Pete’s experience is that the government is approachable and open to ordinary people and their representatives. “We’ve got a direct route into the Scottish Parliament and to the main people, and having a cross-party group at Holyrood has really helped our cause.I still can’t understand why nothing’s being done at Westminster,” he says.

20-minute neighbourhood

I note how he says the smaller Scottish parliament is more responsive and that it is one benefit of living more locally – which after all is our motto in the convenience channel.

“It’s funny you should say that,” Pete replies,“because one of the things that we will be pressing ahead with through the new parliament, is the 20-minute neighbourhood store.”

He explains with enthusiasm that the 20-minute neighbourhood store “is all about giving people the ability to fulfil most of their daily needs within a 15- to 20-minute walk from home. So the focus really is on creating a thriving a local community, with a diverse range of accessible services and businesses with improved communal spaces, in high streets to provide active travel.”

He imagines it as being centred around convenience stores. “We’ve seen in this pandemic, how important convenience stores are to society and we believe this is the way to aid recovery.”

Town centre-located shops and convenience stores have suffered in the pandemic because there are few dwellings around them. When businesses are shut, their customers vanish.

“It’s for that reason that community stores have really thrived, because there is a residential structure around,” says Pete. “Now we need to go back and to create that kind of structure in town-centre locations, so that we’ve got this 20-minute neighbourhood store, and we can make it viable.

He has secured funding for the SGF Go Local programme and they are currently conducting a trial, looking at linking local producers with convenience stores to help aid recovery.

“We’re hoping that we’ll go into stage two and stage three, because it is a way to aid recovery,” says Pete, “going local not only with stores and providing the structure to walk, but also providing the structure to make sure that producers can become retail-ready, because most of them have suffered as the hospitality and catering sector was absolutely devastated.”

He believes that shopping habits have changed permanently to some extent, and that the local vibe is here to stay: “When a road is closed for more than six weeks, people change to an alternative route. And that alternative route becomes the norm.”

North and south of the border

Scotland is different to England and is arguably becoming more so as time goes on. Pete is in the interesting position of being a Sasenach who has “devolved” into being an honorary Scot.

I ask him how he sees the differences between the two countries and what the path for Scottish convenience is in the future: could Scotland be a bellwether for England and Wales?

“Things are changing,” he replies. “When I first joined the SGF board in 1999, I was the first Asian to be invited. We had the multi-site people there at the time, and now they’ve all gone. The big change has been that there’s more independent retailers now than there’s probably ever been.

He outlines how the bigger retailers have been bought up by the Co-ops, ScotMid and other mults. “The second thing is that retailers here in Scotland share more detail than their counterparts in the rest of the UK.”

In a sense there is a really tight community of independents north of the border, and that is helping the development of the sector. “We’re in a bubble of our own,” Pete says. With a population of just over five and a half million, Scotland could easily fit into one side of London. So if you’re willing to network and work hard, it’s not difficult to get to know the main people here in Scotland.”

It is not all easy going, though. Scotland is split into three, Pete explains: town centres, community and rural. And the rural stores have lost their vital tourism trade thanks to the pandemic. “The other factor is that their cost base has risen because of doing their deliveries and employing more people. And they’re cost base has also risen because of the lack of products, being able to go across the waters into these different islands.”

He says that over the years the Scottish government tried its best to equalize costs for the highlands and islands, but it is impossible to do so, and without heavy subsidies will never happen.

The SGF and the future

And what about the future form and action of the SGF, that has just won such a big legislative victory under Pete’s leadership. How has he seen it change over the years?

“When I arrived at the SGF the organisation, Diversity was one of the issues,” he answers. “The other was that it was still stuck in the 1900s. Thirdly, when I took over the Federation [in 2015], it was rudderless, nobody steering, didn’t know which way it was going go. So I made all the changes needed, reorganising the business and making sure everybody knew exactly what they were doing.

Using the business experience of his decades in the grocery channel, Pete came up with a plan. “There were some short-term goals, some medium-term goals and long-term goals,” he says. “And then also bringing on the right people around the board,because an organisation is only as good as the people that are running it.

“Also,” he adds, “everybody thought the SGF was a grocery magazine. So we needed to give ourselves an identity as a trade organisation. It’s been a hell of a journey!”

He says that the short-term goals are simple: restructuring and getting equipped with the right tools to take the organisation forward; recognition at the government level and also making sure to take on the right partners.

Pete name-checks ACS’s CEO, James Lowman, as one of the first that the SGF did a memorandum of understanding with – “Making sure we were working together with our sister organisation, so we took care of everything up north, and they helped us with stuff south of the border. I think that was a clear indication we had the right people in place and then working with BRC and SRC [British Retail Consortium], building a Scottish business resilience centre, working with co-organizations, like Retailers Against Crime …”

SGF’s medium-term goal was to ensure that the objectives of a trade organisation were being properly fulfilled: “That’s why we started working on this Protection of Shopkeepers bill. Then our Go Local programme, which has recently been done.”

The SGF gave grants to help convenience stores grow– for example in developing food to go, “which four years ago was still only a concept,” Pete says. “I remember doing it very well but I don’t believe anybody else was.”

Pete even persuaded the Scottish Government to cough us some cash for the sector. “We said, ‘The way to grow the convenience sector is through food to go, please give us a bit of money and we’ll try and grow that sector.’ And I’m really pleased to say that the money they’ve given us – about £600,000, which isn’t a great deal– has had a significant multiplier effect into the Scottish economy. The knock-on effect was absolutely huge.”

The result already is that Scottish convenience is being transformed into the beating heart of communities, where customers know they can go for great food and treats. “If you look at my son’s store, for example,” says Pete,  “you have all these F’Real machines and Rollover hotdogs and all the rest of it.”

Pete says the next step is talking to the Scottish Government about the “20-minute neighbourhood” to see if we that can be evolved around convenience stores.

In addition to that, there is SGF’s Healthy Living programme, which has been going since 2004. It has a new programme director, Kathryn Neil, who is pushing into the lower demographic stores, encouraging healthier nutrition there – especially among children.

“We’ve also started going out to schools and doing the Big Breakfast, which has been an absolute huge success,” say Pete proudly.“We’ve put thousands and thousands of children through them. I mean, some of the children wouldn’t know what a watermelon or a physalis is. So we are introducing the benefits of fruit and veg to them. We all know many children in deprived areas go to school without even having breakfast.”

Post-pandemic effects

I want to ask Pete how, from his position, he has seen the pandemic affect the convenience sector – obviously such as hammering food to go, but also the subtler and more long-term effects. What does the outlook look like out there?

“I think there’s a lot of work to be done,” he says. “We want three or four things for the future, to help us get out of this pandemic and then really come up on the other side.

“What the government has to do is introduce a moratorium on new policies – put an absolute hold on them, because each that comes out always affects the food and drink sector and there’s a cost. For example with Natasha’s Law [allergen labelling for direct-sale fresh food, in effect October 2021], there’s going to be extra training that’s got to be done.”

He says the SGF works with the government to implement these endless new regulations. “We introduced the guide for the minimum unit pricing, which became the Bible for the Trading Standards officers. We also produce the Vaping Guide; and we are working with the government now, looking at the training not only for personal licence holders, but also for the LSOs [Licensing Standards Officers] and also training that’s got to be provided for the for the local council. But if we can put a stop, a temporary hold, at least for two years on the policies that come through, that’s going to aid a recovery,” says Pete, mentioning the impending Deposit Return Scheme (DRS) which Circularity Scotland – another SGF arm, has just been appointed to as administrator.

“Our desire probably would be to make sure that there’s a UK DRS rather than just Scotland only, but I don’t think that will happen. And I think there will be a delay from 2022 to maybe into autumn of 2023. But I would want the whole UK to go together because otherwise it’s added costs to Scotland, and these [collection/recycling] machines are not going to be cheap, and they’re not for everybody, either. If you don’t have the footfall, then you’re going to have to decide and go for exemptions.”

As he laments, “all of these things are going to take time and money”, and for that reason Pete is campaigning for the extension to the CBILS (Coronavirus Business Interruption Loan Scheme) – “Otherwise some of the retail stores that have really suffered, and a lot of businesses as well, will go bust because they won’t be able to repay them in the timeframe that was originally set out by the government.”

Again, he is thinking of the role of convenience at the heart of the community, concerned for the neighbourhood and locality, not just the indie store itself. “As convenience retailers, we can’t just say that’s okay, Jack, because we’re okay. We have to think about the knock-on effect.”

Assuming the recovery is a success, how does Pete see the next five years?

“I think the food-to-go aspect is very important,” he says. Buying local, from local producers, is also going to be huge because one thing we’ve learned from the pandemic is that we can’t rely on, let’s say, fruit and veg coming from across the water. It was the local suppliers that came in and helped, the local butchers in town-centre locations, supplying the convenience stores in order to make sure that they could still survive.”

Success will also be about really getting to know your customers: “Making sure that you look at each zone so it replicates the opportunity in your area,” Pete advises. “If you’ve an older demographic of customers, then they may want whole-grain bread rather than white bread. The younger people might be looking at, let’s say, health and beauty – we know that the younger people buy more health and beauty stuff. So you’ve got to zone your shop to attune to your customers. But funnily enough, not many people look at that, not even symbol groups, they just seem to put it in one planogram.”

And what about Pete Cheema in five years?

“I think to continue in the role that I’m in,” he replies.“I love what I’m doing and I would love to see the recovery, introducing different schemes and working with the Scottish Government to make sure that convenience stores can thrive.”