As Carrefour phases out the Easy banner in Belgium, commits to reducing its private label packaging in Poland and expands in Romania, we round up news from the retailer.

Carrefour Belgium to rebrand Easy as Express

Carrefour will rebrand its 12 Easy stores in Belgium to the Express banner. Spokesperson Baptiste Van Outryve said, “We had previously stopped the expansion of Easy. After the announcement of our transformation plan in January, we decided to focus on the Carrefour brand with three banners. We do not want to spend additional budgets on other brand names”.

Although the Easy name will disappear, the stores will retain their original focus. They will remain neighbourhood stores for daily groceries, focusing on fresh and offering one promotion every day. The stores will be rebranded with an orange Express logo to set them apart from those with green Express branding, which are smaller and focus on convenience and on-the-go ranges. Carrefour has said both Express variants will continue to play a role in the growth of the format more widely in future.

Carrefour Romania continues expansion

Carrefour Romania has opened two new hypermarkets, in Satu Mare and Baia Mare. The retailer said the two stores are both 7,500 sq. m and will see it operate 35 hypermarkets in the country by the end of the year. The stores will stock 55,000 SKUs, of which 3,000 will be under Carrefour’s private label brand.

Carrefour Poland to reduce its private label packaging

In Poland, Carrefour has committed to reducing the weight of its private label packaging by 5% by 2022. The retailer will also reduce the amount of plastic used. So far, Carrefour has reduced the weight of its private label breakfast range ‘Crumbies’ by three quarters of a tonne in one year.

Carrefour is also undertaking several initiatives to help “preserve biodiversity and care for natural resources”. It is increasing the number of private label products with MSC and FSC certifications and is a member of the Roundtable on Sustainable Palm Oil group. The retailer has also developed the Jakosc z Natury Carrefour (Quality from Nature Carrefour) range with farmers, growers and producers using sustainable agricultural methods.

We complete our review of the trends from the Central and Eastern Europe: outlook for 2018 presentation with the third and final trend;  Retailers trialing digital solutions.

Retailers test in-store retail innovations and invest in online

Retailers across the CEE are investing in digital retail solutions and develop presence in the online channel or optimise in-store operations.

Lidl opened an IT hub in Romania in March 2018, another office to coordinate international online tests and support development of websites and apps. Currently, Lidl in CEE operates online only in the Czech Republic selling non-grocery products. The discounter is testing e-commerce in Poland with www.winnicalidla.pl, a site that sells alcoholic drinks with a Click and Collect service.

Source: www.winnicalidla.pl

Auchan is investing in digitalising its operations and stores in CEE as part of its Vision 2025 strategy. Auchan Romania rolled out its Click and Collect service across all Bucharest stores in July 2018. It also launched an online service in the food service sector, www.lamasa.auchan.ro, earlier in the year. On this site shoppers can order fresh cooked food, and have it delivered home or in the office. Carrefour rolled out in Romania a similar concept along with an app, www.gurmandio.ro.

Source: Auchan Romania, Carrefour Romania

Zabka Poland presented its vision for a 'store of the future' concept in September 2018 which was developed in partnership with over 10 companies that includes Microsoft. It contains solutions that streamline the shopping process and optimise in-store operations, such as a system that helps to adjust prices and assortment in each store to local shoppers. It also uses digital signage and intelligent shelves to inform staff of out-of-date products.

Source: www.zabka.pl

Mega Image Romania follows a similar trend as Zabka with a ‘smart’ store. It developed the concept in partnership with Vodafone Romania, which installed nine retail innovations in-store. These include ‘smart sensors’ to track shoppers’ in-store movement and observe their most used shop paths. Other innovations automate on-shelf stock monitoring, display personalised promotions on digital signage, and reducing payment process with a queue management system.

X5 is installing retail solutions in Perekrestok to optimise in-store operations. These include automation of replenishment, ‘smart’ planogramming, and intelligent labelling to track food storage conditions.

Magnit is investing in the ‘digital transformation’ of its business. One such investment is the roll out of a repair request system. Staff will be able to log faulty equipment using mobile phones by scanning barcodes, which help specify the unit and issue. This system is designed to allow for a quick turnaround in repairs, while allowing staff to focus on customer services.

Source: Magnit Russia

Trends in 2019

Discounters will continue to be more flexible in terms of store size to open stores in residential areas and city centres. All retailers will continue to enhance their food-to-go and food-for-now offers to create shopping destinations. They will look to widen their organic assortment and local ranges to improve shopper perception of the quality on offer and increase choice in healthy eating ranges. In 2019 more retailers will pilot in-store digital retail solutions to drive engagement.

Subscribers can access the full Central and Eastern Europe: outlook for 2018 presentation

We attended X5’s Capital Markets Day in London to learn about its financial performance in the first nine months of 2018 and 2019 business strategy.

X5 sales performance continues to slow down…

The leading Russian retailer reported an 18.9% year-on-year sales growth to reach RUB927,482 m (€12,275 m). Its revenue growth slowed down for the third consecutive quarter, decreasing from 25.5% in Q4 2017 to 17.6% in Q3 2018. Throughout that period, like-for-like growth remained below 1% each quarter this year, while Pyaterochka drove this growth since it formed 79% of total retail sales.

…but still outgrows Magnit

The second largest retailer in Russia reported a 7.7% year-on-year growth in the first nine months of 2018 to reach RUB905,374 m (€12,132 m). The slower growth was partly due to less store openings than X5, as Magnit added 1,092 stores compared to 1,564 by its competitor. Also, Magnit’s like-for-like sales declined by 3.4% for the first nine months of 2018.

X5’s trading strategy across its three formats

X5 presented five key 2019 trading priorities for all three formats which will be: a new pricing and promotional model that adapts each store to fit regional shopper needs; reduction in share of promotions from total retail sales; expansion and/or improvement of private label ranges across all formats to help double their sales share; focus on fresh food offer to raise quality perception; and implementation of in-store technology that will upgrade stores to optimise in-store processes.

Source: www.x5.ru

Pyaterochka will slow store expansion…

The discounter will slowdown store openings over the next five years. Acquisitions of smaller retailers will continue, especially in regions where X5 has low penetration.

…and reduce SKUs by 25%

Pyaterochka will reduce the number of SKU’s by 25% in 1,000 stores as a part of a new pilot project. It aims to create more space for the fruits and vegetables category which should increase the traffic. The retailer is also introducing a new pricing and promotional strategy which includes focus on selective promotions. This should improve on-shelf availability and reduce inventory cost.

Perekrestok will speed up store growth…

The supermarket chain will add more stores in regional cities where it has a low penetration. It will build on its value proposition with the addition of fresh, healthy eating, and ready-meals range. This will be supported with another factory to produce ready-to-eat food in the first half of 2019, and that will add over 800 SKUs.

…and focus on online

Perekrestok hopes to be the number one food online retailer by 2021. It plans to double the assortment to 50,000 and include the Karusel range, especially non-food. It will launch a Click and Collect service, express delivery, and the same day delivery next year. Two more ‘dark stores’ will be open to service Moscow city, Moscow region, and St Petersburg.

Karusel to roll out new concept in 2018

Following the launch of a new Karusel store concept earlier in 2018, the retailer will implement it across 10 stores by end of 2018 and continue in the process in 2019. The remodelled stores will include categories such as organic, healthy eating products, and areas dedicated to new categories such as home. The retailer will start a Click and Collect service across the network that same year. There are no ambitions to increase the number of stores for next year, but Karusel will re-locate branches to sites with bigger catchment areas.

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