In the beginning of 2018 we laid out some of the trends to shape Central and Eastern Europe’s (CEE) grocery retail market. As we near the end of the year we review them. In the first part we highlight some of the examples that confirm our first two trends - Discounters flex new store sizes and Building shopping destination.
Discounters flex new store sizes
Discounters in CEE are diverging away from their average store size for two reasons. First because retailers like Biedronka and Lidl are expanding their ranges to attract shoppers. Second reason is because they want to open more stores in high streets which means smaller stores or different store layout to accommodate each location.
Biedronka launched smaller sized stores in high-footfall locations such as train stations. The store in Poznan central station is at 420 sq. m., below the average size of 658 sq. m. These smaller stores were first created in 2014, and now the discounter looks to speed their expansion.
Biedronka in Poland opened a non-grocery store under the name ‘Biedronka Outlet’. Its size is at 850 sq. m. and the range is limited to the category consumer home appliances and gardening.
Source: Biedronka.pl, IGD Research
Lidl Poland stores average at around 1,000 sq. m. In the summer of 2018, the retailer opened a temporary 1,400 sq. m. store at the Pol'and'Rock Festival music festival. The store was opened for 24 hours and its aim was to promote the product range to young shoppers. Similar concepts were launched by Lidl Slovenia.
Aldi Süd also launched temporary stores in Hungary across several music festivals. The stores were around 350 sq. m. in size with a range of 300 SKUs that met the needs of festival goers. It included barbecue ranges, breakfast meals, and soft drinks.
Lidl Bulgaria opened a larger than average store in Sofia at 1,300 sq. m. and spread across two floors. The retailer designed this new store concept to fit densely populated urban areas. It said it ‘seeks optimal solutions to maximise customers shopping convenience’.
Building shopping destination
CEE retailers are investing in their store concepts to increase and extend shopper visits. They add in-store services or expand ranges to attract shoppers with more shopping missions.
Kaufland new store concept in Bucharest includes a food court targeting food-to-go and food-for-now mission. In addition to that the retailer displays recipes on gondola-ends under the banner ‘Reteta saptamânii’ (Recipe of the week) to inspire shoppers to cook.
Ahold Delhaize’s Mega Image opened a new store concept, ‘Shop&Go Mega Apetit’, in Bucharest in March 2018. The ‘ready-to-eat’ format targets food-to-go and food-for-now shopper missions. Its range includes the ‘Mega Apetit’ private label range, building on its success since the launch in 2016.
Source: IGD Research
Biedronka and Lidl in Poland are adding lockers to their stores to offer a Click and Collect service to fulfil Sunday orders. While Biedronka is installing 300 SwipBox lockers, Lidl has partnered with InPost in a project to roll out Paczkomaty lockers. This move follows the implementation of the Sunday trading ban since March 2018. The German discounter plans to launch non-food ecommerce in 2019.
Look out for part two of our Central and Eastern Europe: outlook for 2018 revisited piece that will look at the next two trends - Build trust with organic and local ranges and Healthy living, healthy eating focus.
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