A new kind of supermarket us set to pop up nationwide with prices 70% cheaper

How do they do it? Bargain Grocery Outlet has built a supermarket around surplus — and now plans to take the model nationwide through Independent Operators

Bargain Grocery Outlet (BGO), the Stevenage-based surplus-first supermarket, is preparing for national expansion through a network of independently owned stores after strong customer demand and around 100 Independent Operator enquiries within weeks.

The model fits extremely well with the cost-of-living pressures facing many households today, as consumers look for ways to make their grocery budgets go further without compromising on quality.

But how can a supermarket sell recognised branded products at prices that can be up to 70% below RRP on selected lines?

The answer lies in BGO's surplus-first, opportunistic buying model.

Rather than relying mainly on fixed product ranges like a conventional supermarket, BGO continually searches for exceptional buying opportunities from manufacturers, importers, wholesalers and distributors.

Products can become available because of overproduction, excess stock, cancelled orders, packaging changes, discontinued lines, seasonal overstocks and clearance, products approaching or passing their Best Before dates and other commercial circumstances.

BGO purchases these products at significantly reduced costs and passes much of that saving on to customers.

Reducing food waste

There is also an important environmental purpose behind the model.

WRAP estimates that approximately 10.7 million tonnes of food was wasted in the UK in 2021 across households, hospitality and food service, manufacturing, retail and farms.

BGO aims to help suitable surplus products reach consumers rather than unnecessarily becoming waste.

Save Money. Reduce Food Waste. Protect the Planet.

BGO co-founder Dee Thaya said:

“We make this a win-win for everyone involved. Our customers save money, our Independent Operators have the opportunity to build their own businesses, our suppliers recover value from surplus stock and, most importantly, we reduce unnecessary waste and help protect the environment we all live in.”

“We have built a supermarket around surplus”

Thaya said:

“Traditional clearance warehouses sell surplus. We have built a supermarket around surplus, and our ambition is to build around the country through our network of operators.

“We are surplus-first rather than surplus-only, so alongside the exceptional bargains customers discover, we also want them to be able to buy the everyday products they need.

“Customers can buy one item, several items or, where appropriate, a whole case within a proper retail environment. That combination is what makes BGO different. We believe there is currently nothing quite like it at national scale in the UK retail market.”

BGO's range includes grocery, confectionery, snacks, soft drinks, alcohol, chilled and frozen foods, pet products, household, personal care, ethnic foods, NOSH – Natural, Organic, Speciality & Healthy – and selected non-food products.

Stores are open to everyone with no membership required.

BGO also secures premium frozen foods at discounted prices, including products originally manufactured for five-star hotels, premium pubs and restaurants before becoming available through surplus or changing commercial requirements.

Customers changing the way they shop

The expansion has partly been driven by existing customers, including people travelling from outside Stevenage and asking BGO to open stores closer to where they live.

“Quite a few customers tell us that once they start shopping at BGO and see the huge difference in prices, they find it difficult to go back to paying full price elsewhere. That's why we say Shop BGO First. See what bargains we've rescued, save on what you can with us, and top up the rest as needed. Our stock is constantly changing, so there's always something new to discover — and when it's gone, it's gone.”

Around 100 Independent Operator enquiries within weeks

When BGO briefly advertised its Independent Operator opportunity, it received around 100 enquiries within just a few weeks.

Interest has stretched from Brighton to Glasgow and from Norwich to Nantwich, with enquiries coming from many other parts of the UK.

The enquiries have come from a wide range of professional and commercial backgrounds, including an IT director, a corporate finance manager at a blue-chip company, a senior operations manager, existing retailers and experienced entrepreneurs.
Several prospective operators have also expressed interest in operating multiple BGO outlets, rather than simply opening one location.

“What has particularly encouraged us is not just the number of enquiries, but the geographic spread and calibre of the people coming forward. Several prospective operators are already asking about operating multiple BGO outlets. You don't necessarily need a grocery background. Leadership, commercial awareness, customer focus and the determination to build a substantial business are more important.”

Dee Thaya runs BGO alongside his son and fellow co-founder, Brendan Thaya, who is pursuing Industrial Economics and AI and contributes to the long-term strategy and development of the business.

A fragmented UK market

BGO believes the UK surplus-retail sector remains relatively fragmented and regional, with many existing operators trading primarily through warehouse or clearance-style formats.

Internationally, surplus and opportunistic grocery retail has developed considerably further.

Grocery Outlet in the USA, for example, operates an opportunistic grocery model supported by Independent Operators. Its 2024 Impact Report recorded more than 40,000 Independent Operator enquiries, 49 new Independent Operators joining during the year and 481 Independent Operators by year end.

BGO has also studied established surplus and opportunistic retail businesses in Norway, France, Australia, New Zealand and Canada.

Thaya said:

“The demand is already proven. What remains fragmented in the UK is how that opportunity is presented to customers. We believe there is room for a recognisable national surplus-first supermarket network operating successfully alongside B&M, Home Bargains, Farmfoods, Aldi, Lidl and the major supermarkets.”

Turning supplier surplus into value

BGO has developed a growing network of manufacturers, wholesalers, importers and distributors, with suppliers increasingly approaching the business when they need to clear surplus or excess inventory.

“For suppliers, surplus stock still has value. Our role is to provide a responsible and controlled route to market while reducing unnecessary waste. As our network grows, our capacity to purchase larger quantities will grow with it. Stock that may be too large for one BGO store could ultimately be distributed across many locations.”

As the network develops, BGO plans to establish its own central warehousing and distribution operation, enabling larger buying opportunities to be purchased centrally and allocated across Independent Operator stores.

Best Before doesn't mean Use By

Customer education is an important part of the BGO model.

Some products may be approaching or, where appropriate, have passed their Best Before date.
Best Before relates primarily to quality — including taste, texture and freshness — rather than food safety.

Food can be sold after its Best Before date provided it remains safe and suitable for sale and relevant food standards are followed.

A Use By date relates to food safety. BGO does not sell products beyond their Use By date.

A capital-efficient approach to opening stores

BGO's philosophy is:

“Don't over-invest in the shop. Invest in the business.”

Where suitable premises already contain usable flooring, ceilings, lighting and infrastructure, Independent Operators will be encouraged to retain suitable existing assets and, where appropriate, use good-quality second-hand shelving, refrigeration and equipment rather than incur unnecessary shopfitting costs.

BGO will support Operators with property assessment, store layout and fit-out, EPOS and CCTV, initial stock selection, merchandising, launch marketing, staff training, its Operations Manual and ongoing buying, marketing and operational support.

Experienced franchise support

Paul Love-Mitchell of Plus Franchise Group, who has been advising BGO on the next phase of its franchise development, said:

“I have been involved in franchising a wide range of businesses over the past 40 years, and BGO is a genuinely distinctive concept. The combination of surplus-first retailing, exceptional customer value, a constantly changing product range and the opportunity for local ownership makes it an exciting proposition for people looking to start their franchising journey as Independent Operators. The UK surplus market remains fragmented, and I believe BGO has the opportunity to develop a strong and scalable network as the business moves into its next phase of growth.”

Paul Love-Mitchell and Nick Modha of Plus Franchise Group will also help suitable applicants explore potential franchise-finance routes, subject to individual circumstances, lender criteria, affordability and approval.

Independent Operators wanted nationwide

BGO is now seeking ambitious Independent Operators for London, the Home Counties and suitable locations throughout the UK.
Thaya said:

“The Independent Operator brings local entrepreneurship, leadership and day-to-day ownership. BGO brings the brand, buying expertise, supplier relationships, systems, training, merchandising, marketing and ongoing support. Our long-term ambition is simple: make surplus-first shopping accessible to communities throughout the UK.”