Sir Peter Davis, Sainsbury’s group chief executive said, “Sainsbury’s has learned a lot from this trial but we have been unable to agree commercial terms for roll-out.”

“We have been trialling our own health and beauty offer separately and will now expand this range via a mixture of new own-label and international brands. The five trial stores have seen significant sales increases which show that we can create sufficient value by operating our own extended health and beauty department.”

“We have added over 1,500 health and beauty products to Sainsbury's existing range of 4,500 products over the past year. In addition to extending the range, we also tested new in-store environments to decide which offer was the most appealing to our customers.”

The UK health and beauty market is worth £6 billion per year and supermarkets have 48% share. Supermarket growth is twice as fast compared to the total market, growing at 8.4% year on year. Sainsbury’s is also looking to increase its number of pharmacies and pharmacy services following OFT recommendations on NHS contract deregulations.

Sara Weller, Sainsbury’s deputy managing director said, “The trial clearly showed us that Sainsbury’s is positioned to offer a strong health and beauty offer. Our new ranges are well liked by our customers who have told us they want to be able to pick up their health and beauty essentials including prescriptions and toiletries, as well as premium beauty products at times and locations that fit in with their busy lifestyles. We have worked hard at sourcing well-respected international brands, as well as formulating our own very successful quality ranges such as Active Naturals which we launched successfully in September 2002.”