European retail trends in the current economic situation

Posted on

Abstraction:

Planet Retail, a British company of market research, has given to the promotion in 2009 [ 3,6 ] a survey that offers an overview of retail in Europe. Harmonizing to him, in the country of nutrient trade continues the phenomenon of consolidation in Western Europe, while growing chances remain attractive in Central and Eastern Europe. As for important tendencies, attract atention: the manner of change overing the price reduction shops, the increasing per centum of it ‘s ain trade names supplied by the deceleration of economic gait and the environmental impact of packaging.

Introduction

European retail development is the consequence of the influence of several factors, some with direct action, others with indirect action. As shown in the survey conducted by Planet Retail, the jobs caused by the fiscal crises in the United States, the low power of the U.S. dollar, the increasing of the energy and nutrient measures, have led, accumulated, to the demand and consumer assurance lessening, issues that have affected of import parts of the universe economic system.

So, the general rise in monetary values to public-service corporations ( particularly nutrient and energy ) is already reflected in family disbursement ( which are transfered in Western Europe, from luxury merchandises and those bought pleasance to basic goods ) and in the nutrient crisis on emerging markets.

However, despite the economic crisis, Europe remains a mention market in footings of economic growing, but besides in footings of competition. France, Great Britain, Italy and Germany have, each of them, a legion population, with comparatively high incomes and buying power, still rather high compared with other provinces. On the other manus, the provinces of Central Europe are in the center of an economic takeoff procedure, which will likely take another two coevalss. Russia is perceived as a market with a high potency, which likely will go on to be a favourable investing country in the following few old ages.

The rise in monetary values to public-service corporations had a direct influence on both retail merchants, and manufacturers and consumers. As illustrations, Planet Retail referred in the market survey to the market monetary value of rice, which has increased by 74 per centum points and that of wheat, which besides registered an addition of 130 per centum points from one twelvemonth to another. As respects the prognosiss on the places and the development of the first 10 retail merchants until 2012, Planet Retail estimated that the first place in the categorization will go on to be occupied by the Carrefour group, as a consequence of some spread outing investings on the markets, in go oning development from Cardinal Eastern Europe a turnover prognosis of about 104,004 million, until 2012. Although Tesco is in the 2nd place with 63,727 million in 2007, the market research company estimates that, in future, the British retail merchant will lose the place held in favour of the German retail merchant Schwarz Group, which will go on opening new shops on the Europe market. Schwarz Group will make, as specified in the market analysis, the value of gross revenues of 85,058 million euros, in 2012, with 2,409 million euros more than the British retail merchant. Other participants in this categorization are Aldi and Edeka, which will take before well in the following few old ages.

The mass of the international bargainers from Rumanian market came into position after twelvemonth 2000 as table 1 shows. The most familiar trade name in the consumers ‘ head is the hypermarket. The degree of appraisal and repute of hypermarkets is influenced by the undermentioned factors: location, low monetary values, good quality-price ration, scope of goods, interesting price reductions, the characteristic of the shop, forces ‘s kindness etc.

The fiscal consequences of the international bargainers from Rumanian market are shown in table 2. Beside these companies are reputed supermarkets and hard currency and carry bargainers like: Billa, Mega Image, Interex, Metro, Selgros which activate in trade good trade in Romania ( table 3 )

Condition

Table 1. State of chief international bargainers in Romania in 2008 and 2009

No.

Trader

Year of entry in Romania

Openings 2008

Openings2009

Shuttings 2009

1.

Intersection

2001

26

8

Armonia Braila

2.

AUCHAN

2006

2

2

0

3.

Persephone

2003

0

0

0

4.

KAUFLAND

2005

8

6

0

5.

Real

2006

6

4

0

6.

INTERMARCHE

2003

1

2

Focsani

7.

Spar

2006

3

0

0

8.

BILLA

1999

6

9

0

9.

G’MARKET

2000

0

0

Bacau

10.

MEGA IMAGE

1991

14

15

0

11.

Metro

1996

1

0

0

12.

SELGROS

1999

1

1

0

13.

Penny Market

2005

21

28

0

14.

PLUS DISCOUNT

2005

21

25

0

15.

PROFI

2000

10

22

0

16.

miniMax Discount

2005

6

12

0

Beginning: “Progressive Shop” magazine, Marss 2009

Analyzing the retail in universe, it is remarked that Western Europe is extremely concentrated, 10 of the top retail merchants having about 40 % of the market. Although it is improbable a farther concentration on market degree, we can besides detect that the Central and Eastern Europe presents the greatest development potency, with an of import expected growing for 2007-2012.

Table 2. Fiscal consequences of chief hypermarkets in Romania in 2007 and 2008 ( 1000000s Euro )

No.

Hypermarket

2007

2008

Employee turnover

Net Net income

Net Loss

Employee turnover

Net Net income

Net Loss

1.

Intersection

866

24.7

1,190

20.1

2.

AUCHAN

155.4

0.9

278

6.7

3.

Persephone

407

12.6

399.3

19.7

4.

KAUFLAND

643

15.7

778.6

3.7

5.

Real

367

47.5

638

55.4

6.

INTERMARCHE

85.3

4.1

95.8

3.9

7.

Spar

38.5

3.2

n/a

n/a

n/a

Beginning: Piata Magazine, Nov. 2009

Looking at the European retail map and taking into history the fact that, in some instances, neither can be a top 10 of the participants in retail ( particularly in Eastern Europe ) from the market concentration point of position, but there is surely growing possible, states such as Poland, the Czech Republic and Slovakia – presently dominated by the retail merchants coming from the Western Europe – being the cogent evidence in this respect. Among the key participants in these markets it can be remembered: Metro, Schwarz, Tesco, Carrefour and Casino.

On the other manus, in the Central Europe country there is a tendency of growing moderateness that matches the augmentation of the grade of concentration. Therefore, in Poland, although there is a legion population, the retail faces stiff legislative steps refering the gap of new shops, Russia presents the highest growing possible although, in this instance, concern nowadayss major hazards caused by the authorities control over the energy beginnings ; in Ukraine, buying power is low, but long term, it can pull important investings, Romania and Bulgaria have a high growing potency.

Table3. Financial consequences of chief supermarkets and hard currency & A ; carry bargainers from Romania in 2007 and 2008 ( 1000000s Euro )

No.

Supermarket and hard currency & A ; carry

2007

2008

Employee turnover

Net Net income

Net Loss

Employee turnover

Net Net income

Net Loss

1.

BILLA

322.7

10.5

323

10.3

2.

G’MARKET

59.5

0.03

51.9

1,6

3.

MEGA IMAGE

100

0.5

132

0.23

4.

Metro

1,590

n/a

n/a

1,630

n/a

n/a

5.

SELGROS

823.2

36.4

860

39

Beginning: Piata Magazine, Nov. 2009

Taking as mention the twelvemonth 2007, the British market research company makes anticipations sing the development of the types of stores. Harmonizing to estimated computations, hypermarkets will keep on the first place, as a consequence of their development in Central and Eastern Europe, for 2012, the gross revenues of this type of shop is valued at 509 billion euros ( with 145 billion more than in 2007 ) . Although it will go on to be an of import shop format, as the monetary value of oil will lift, much more people will see it “ one-stop shopping ” . Supermarkets will register a visibly accelerated growing, which will amount the gross revenues value from 327 billion to 460 billion. Even if they are on the 3rd place as size, the price reduction type shops increase in penchants, the size of this channel was estimated at gross revenues of 213 billion euros in 2012 ( upswing from 141 billion, as registered in 2007 ) . The survey shows that the price reduction type shops will run into the greatest advancement in the following five old ages, being likely to take before in Europe, due to favourable existent estate clime. The latest places in the categorization, depending on size distribution channel, are occupied by the Cash & A ; Carry shops, propinquity shops and shops from the gasoline Stationss ( forecourts ) . The propinquity shops and those from the gasoline stations become more and more of import on the saturated markets such as Great Britain, France or Scandinavia.

1. Discount houses and the new challenges of the economic environment

On top of the first five discount houses – Aldi and Lidl are by far the most of import in Europe in this categorization. Aldi has lost, nevertheless, the taking place in favour of Schwarz Group ( Lidl ) , due to the accelerated enlargement of the latter on the European market. On the other manus, Edeka won reasonably much land, chiefly through the acquisition of Plus concatenation, owned by Tengelmann ‘s. From the point of position of states development, Planet Retail estimates that Germany will kick off 1598 new shops until 2012 ( in this state is good known that the gap of new shops is still considered an of import event, the price reduction type shops being associated with the thought of propinquity shop ) . In France, new ordinances refering the belongings will feed the increasing of the price reduction shops figure, being estimated the gap of another 1,177 shops until 2012. After Poland, which, harmonizing to Planet Retail, will kick off about 876 shops until 2012, another interesting market is that from Great Britain, where, after a short interruption, the construct of price reduction Begins to derive as a consequence of the increased nutrient monetary values, the channel being addressed more and more to the consumers from the mean category.

In Romania there are the undermentioned discount houses Penny Market, Plus Discount, Profi, miniMax Discount with 196 locations ( at the terminal of twelvemonth 2008 ) in bulk of state parts ; the fiscal consequences of these discount houses are shown in table 4.

The increasing figure of price reduction shops is non the merely expected alteration in the European retail, the British market research company besides identified a alteration in the features of this type of shop.

After old ages, when the British market registered moderate accomplishments, the price reduction retail merchants are seeking to profit from the favourable economic clime and do attempts to do the consumers to be faithful. As portion of the scheme of raising market portion every bit much as possible, discount houses turned from classics price reduction operators into general nutrient stores, without losing sight of their chief aim, nevertheless. They have turned the low-priced schemes into schemes more sophisticated, by differentiated monetary values, presenting the organic merchandises in their ain offer, just trade, more attractive methods of packaging, services for consumers, new design, copying in this manner the propinquity shops. One of the representative illustrations in this respect is the Aldi shop, opened in the terminal of 2006 and positioned on one of the chief streets of Manchester, dedicated to shopping. The shop is aimed both to clients who prefer particularly the price reduction type shops, and to those for which this is a more convenient option, being situated in close propinquity. Similar sites have been inaugurated in all the UK. Planet Retail speaks in this instance about a construct alteration by inside informations that until late was non portion of the discount houses universe. Among these can be mentioned the bright marks that indicate the merchandises that can be consumed “ on the spell ” and besides its ain, premium trade names, which attract consumers with high incomes and, until late, did non represent the price reduction shops mark. The 2nd illustration is offered by the Lidl Express shop, inaugurated in August 2008 in Edmonton. Harmonizing to the company which carried out the market research, this shop combines the propinquity construct to the price reduction construct, a premier statement for this being the 550 square metres country which it owns, tantamount to half of the normal size of a price reduction shop. It is singular in this type of shop excessively, the tendency of the “ to travel ” type merchandises, as an invention being the java base, that is located inside the shop and its ain bakeshop.

Table4. Financial consequences of chief discount houses in Romaniain 2007 and 2008 ( 1000000s Euro )

No.

Discount house

2007

2008

Employee turnover

Net Net income

Net Loss

Employee turnover

Net Net income

Net Loss

1.

Penny Market

25

6.2

341

8

2.

PLUS DISCOUNT

n/a

n/a

n/a

256

19.2

3.

PROFI

65.6

14.4

94.5

0.2

4.

miniMax Discount

25

2.4

43.1

4

Beginning: Piata Magazine, Nov. 2009

Reshaping the construct of price reduction has been identified excessively, in the instance of the Netto retail merchant from France. Division of ITM, Netto tests a new construct for its ain streamer. It owns merely one location and aims to pull new clients on the price reduction sector. With the position of following a new image, Netto patterns moderate price reductions for the most trade names in the portfolio, has a generous coloring material switch, black contours that emphasizes the layouts of merchandises. It besides owns a departament of babe merchandises, similar to the supermarkets and adopts a promotional scheme, similar to the one applied by the Belgian retail merchant, Colruyt. In order to pull new clients, discount houses have opted for the single packaging method. There are mentions to the Aldi shop from Manchester, where fruit rations, separately packaged, can be found and ED store from Paris, where an increased demand for merchandises packaged in this manner was noticed.

2. Positioning their trade names

Harmonizing to the research that Planet Retail has carried out, Europe brings together some of the markets with the highest grade of perviousness of the construct of “ ain trade name ” . Among these, Switzerland has the highest market portion of private trade names ( 45 % of entire ) , followed by Germany and at a little difference, by the United Kingdom. The positioning schemes of the European retail merchants take into history several facets. So, it is stressed the peculiar involvement of making its ain trade names in the organic Fieldss, healthy nutrient, just trade. Another celebrated tendency is the creative activity of sub-brands, such as Casino Ondilege and Carrefour Baby.

The placement scheme besides refers to the cleavage based on monetary value ( economic, standard and premium ) , fluctuation that give to the consumers more pick possibilities and provides to the retail merchants a better control of a class. Most frequently, the solution of its ain trade names is adopted by the most developed retail merchants.

Tesco has agreed the criterion, the economic section being, normally, foremost introduced when Tesco perforate a new market. For the British retail merchant, Hungary is the most advanced foreign market for their trade names. Tesco Gazdasagos, the ain trade name positioned on the economic section ( value scope ) was introduced in 1988 and includes about 1,000 lines.

The indispensable characteristic of this trade name is that Tesco guarantees the monetary value ( paying the monetary value difference if the consumer finds the same merchandise, in the same sum, at another retail merchant ) . The standard line, Tesco Minoseg, was introduced in 2000 with more than 700 merchandises and it has been extended to 1127 lines. These merchandises can be purchased 20 % cheaper than the trade name merchandises from the same class. Tesco Fit, the category of healthy nutrients was introduced in 2003 and includes around 60 lines. Premium class, named Tesco Finest, includes 20 different merchandise lines. Much of the retail merchants have non yet involvement in advancing economic lines, due to low net income borders. Even if the economic lines are needed to prolong the retail merchants competitiveness, they should non represent the chief aim of a shopping walk, as the image of the simple, unfinished packaging of these merchandises expresses. The retail merchants message as respects the economic section, as specified in the survey, is: “ We have these merchandises in the portfolio, but delight do non purchase them. ” Specifying, the British retail merchant Tesco scheme to advance the economic line at the shop entryway, may shortly be regarded as selling tool, designed to back up the fight on monetary value of the retail merchant, than every bit serious offer for clients.

Traveling to a new case, we mention the Austrian retail merchant Spar, which has launched a new economic line in May. S-Budget, his ain trade name, positioned on the economic section, includes merchandises such as: rice, wheat, fruits and veggies and besides some ready-meals. S-Budget was launched at the same time on the place market and besides on the markets from Croatia, The Czech Republic, Hungary, Italy and Slovenia.

In Switzerland, the market leader Migros has started a monetary value policy for more than 300 production lines, under its ain, economic trade name M- Budget. This move followed the enterprise of the rival Coop, which in February implemented a similar scheme under the trade name Guarantee Prix.

In an epoch of economic recession, both private premium trade names and the economic 1s can profit. Positioning in three waies for the merchandise lines ( economic, standard and premium ) , which offers to the consumers more freedom of pick, proves to be really successful. Besides, the survey punctuates the part of the ain trade names to entire gross revenues, which will likely make 20 % until 2008 and 23 % until 2013. In add-on, advancing the economic section takes topographic point coincident with the enlargement of the premium lines and those that are specialized.

3. Duty towards the environment

Although many actions to protect the environment meet loaning troubles, there was no ground for that, in retail, concern concerns and those sing the environment can non coexist ; there is a really strong connexion between environmental duty and answerability in concern. The Belgian retail merchant Colruyt is one of the most suited illustrations that Planet Retail has surprised in the analysis excessively.

In the class of ecological merchandises, those for place attention, which have important additions from twelvemonth to twelvemonth, have a large importance. They, like other ecological merchandises, are more expensive than the conventional merchandises. Despite this fact, the benefits originating from ecological discrepancy may cover the merchandise monetary value itself ( as it happens, for illustration, in the economic visible radiation bulbs instance ) . In this context, even if some classs can be eliminated as a consequence of some legislative alterations, or as a consequence of the bargainers ‘ determinations, the ain trade names on the section continues to turn. Because about 30 % of entire family waste is boxing from the supermarket, packaging has become, in this position, one of the countries most frequently targeted, as a concern to protect the environment.

Some solutions that can be implemented successfully in this country, should be: altering the cleansing agents, utilizing of compacted detergents, cut downing the bundles, utilizing of local beginnings, etc.. And because their ain trade names are progressively of import in the merchandise portfolios, a important portion of the retail merchants have already introduced eco-packaging for them. Some packaging solutions, such as NatureWorks PLS – a bundle of corn amylum used by Spar for boxing fruit and veggies – are rather expensive to be adopted on a big graduated table. For this ground, merchandisers have turned to other methods, such as cut downing the weight of packaging. Therefore, Marks & A ; Spencer use small trays of polystyrene, 20 % lighter than the conventional small trays. Tesco uses today, reclaimable packaging for all merchandises under its ain trade name, taking to cut down their sum by 25 % until 2010, both to trade name merchandises and to those under its ain trade name.

Furthermore, a turning figure of retail merchants control the losingss through utilizing plastic boxes for veggies that can be recycled, implementing their ain packaging systems ( eg. Aldi ) and perpetrating people in the recycling procedure.

In line of a responsible attitude is besides the enterprise of the retail merchant ITM, which introduced with information particular to its ain trade name merchandises, a templet ( base on balls ) to educate consumers in footings of protecting the environment.

One of the most of import steps in footings of packaging proved to be taging on the label the indicants about protecting the environment. Casino is one of those who took the enterprise to tag on the label the emanation of C resulted from the distribution of merchandises by mentioning to the figure of kilometres covered by each merchandise, battalion weight and a few references as respects the possibility of recycling, every bit good as the measure of C dioxide emitted into the ambiance for each merchandise in each phase of its being – production, conveyance, packaging and merchandising procedure. In the Casino instance, this determination of labeling should be introduced to more than 3,000 own-brand merchandises, which means a much better consumer information.

Decisions

In order to win in the retail industry, characterized by a terrible competition, invention should organize the footing of each developed scheme.

In the following old ages, the procedure of the market consolidation in Western Europe will go on, while in Central and Eastern Europe new chances for enlargement will be. The discount houses will accommodate their construct to the current demands of consumers. In line with the economic slow down, the personal trade names from the economic section, every bit good as those from the premium class can profit both of these alterations.

Last but non least, the retail merchants will go on to concern in protecting the environment with important effects on the procedure of packaging.

Mentions

  1. Gavrila, Ilie ; Gavrila, Tatiana – Competitivitate Si mediu concurential, Editura Economica, Bucuresti, 2009 ;
  2. Marinescu, Cosmin ( coordonator ) – Economia de piata. Fundamentele institutionale ale prosperitatii, Editura ASE, Bucuresti,2007 ;
  3. hypertext transfer protocol: //www.planetretail.net/ ;
  4. Colectia Revistei „Piata” , 2008-2009 ;
  5. Colectia Revistei „Modern Buyer” , 2009 ;
  6. Colectia Revistei „Magazinul progresiv” , 2008-2009 ;

Tendintele retailului European in actuala conjunctura economica

Rezumat: Planet Retail, companie britanica de cercetari de piata, a digital audiotape publicitatii in 2009 [ 3,6 ] un studiu Ce ofera O privire de ansamblu asupra retailului blare Europa. Conform acestuia, in zona comertului alimentar continua fenomenul de consolidare in Europa de Vest, in timp Ce oportunitatile de crestere raman atractive in Europa Centrala si de Est. Cat priveste trendurile semnificative, atrag atentia: modul in attention Se transforma magazinele price reduction, cresterea ponderii marcilor proprii alimentate de incetinirea ritmului economic Si impactul ambalajelor asupra mediului.