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Spain-based Mercadona has begun hiring staff ahead of its launch in Portugal, which is planned for 2019.

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As Eroski continues to expand its range of online fulfilment options for shoppers, Carrefour trials a new store design in Madrid and Grupo IFA forecasts continued revenue growth in 2017 for its members, we round up news from Spain.

Eroski adds delivery service

Eroski has launched a delivery service that enables shoppers to receive orders made before 15:00 to receive their products on the same day. The service, available only from Monday to Friday, is free for shoppers. Customers can choose from a range of 15,000 SKUs and has proved popular, with the retailer’s online business manager, Mari Mar Escrig, quoted as saying: “In its first days in operation, more than 20% of customers have opted to request delivery on the same day.” The new fulfilment option means that shoppers can order online and have them delivered or collected in-store or at collection points in stores’ parking areas.

Carrefour opens gourmet store in Madrid

Carrefour has added a premium Market store in Madrid. The new supermarket uses more colour, has upweighted its fresh offer and expanded its range. Spread across two floors the store dedicates the whole of the ground floor – which measures 490 sq. m – to fresh produce: fruit, meat, fish, cheese, bakery and sushi. The basement floor – which measures 580 sq. m – provides shoppers with perfume, drugstore, wine and frozen products. In total the store carries 12,000 SKUs. To enhance the offer, the store also provides services like dry cleaning, shoe repairs, free wifi, photo development and home delivery.

Grupo IFA forecasting revenue will grow 5% in 2017

As part of a presentation at the Aecoc Congress, Grupo IFA’s chief executive, Juan Manuel Morales, said that it was expecting its members to increase their sales by between 4% and 5% in 2017. Morales said that IFA was ‘happy for the evolution that is having the year, so we have the confidence that it will be a great exercise, in line with the last two years’. He went on to note that its members’ strategy was based on three pillars: proximity, fresh products and choice. With the latter point, IFA’s members are overweight with branded ranges, with manufacturer brands accounting for 81% of their ranges, versus 64% in Spain more widely.

Mercadona expands ‘Hippos’ childcare range

Mercadona has added new products to its Hippos child-focused private label range. The new items are focused on children’s hygiene and are manufactured by the retailer’s long-standing partner, the Suavinex Group. The launch sees Mercadona add shampoo, moisturising lotion and body oil, amongst others.

Ulabox launches Black Friday campaign

Sonae-owned Ulabox has said it will operate a Black Friday campaign from 23 to 28 November, offering savings of up to 50% on grocery ranges. The 50% off fresh food ranges will only available to shoppers in Barcelona and Madrid, while wine and other products will be available across the whole country.

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As Bon Preu and Coviran announce full year results, Mercadona and Grupo Uvesco discuss innovation, we round up news from Spain.

Mercadona: Portugal is perfect place to test format

After a long time discussing the potential internationalisation of its format, Mercadona finally announced it was to enter Portugal in Q2 2016. Discussing the first step outside Spain, its president, Juan Roig, said that the market is a perfect place to start given the similarities between the two markets, versus entering another country like France and Italy. Roig also explained how logistically it made sense to enter Portugal given its ability to meet stores’ deliveries from its existing warehousing.

However, it appears that the Portuguese market entry is likely to be a first step in Mercadona’s expansion. The retailer’s first co-innovation centre outside Spain, which will open in Matosinhos, will help it to learn about shoppers outside its home market for the first time.

Covirán enjoys good growth in 2016

Covirán has announced full year 2016 results saying that its turnover rose 4% to €660m, while sales through Covirán branded stores rose by the same figure to €1.26 bn. The results were aided by a 1% increase in selling space, but driven by new and existing shoppers spending more. By market, Covirán said it generated €1.154 bn in Spain, through 2,550 stores, and €106m in Portugal, from 330 stores. In 2016, Covirán said it and its associates invested €19m to expand its presence, upgrade stores and its technology and in the addition of a new distribution centre.

Looking to the future, the co-operative’s chief executive, Luis Osuna, said that it was focused on achieving gross sales of €1.5 bn in 2020. To help achieve this target Osuna said it was looking to launch online, potentially by the end of 2018, and to enter Morocco in 2019. To enable it to test the potential for its brand in Morocco, Osuna said it would establish two trial stores in either Q4 2016 or Q1 2017. Covirán said it saw more opportunity for its brand in north Africa than it did in other European countries.

Bon Preu FY2016: sales rise by 9.2%

Bon Preu has said sales rose 9.2% to €1.077 bn across its operations in 2016. It said sales growth was across all its operations, both its Bon Preu and Esclat banners, its forecourts and online. The retailer said sales growth was underpinned by its continued investment in its business, with it investing €103m in 2016 to add three Esclat hypermarkets, four Bon Preu supermarkets and the renovation of an Esclat store. At the end of the financial year Bon Preu said it operated 212 stores in Catalonia: 122 Bon Preu supermarkets, 47 Esclat hypermarkets, 40 petrol forecourts and three Iquodrive click and collect points.

Looking ahead to 2017, Bon Preu said it was aiming to generate a turnover of €1.2 bn. The growth target will again be underpinned by new store openings, with the retailer set to increase its investment for the year to €140m.

BM Supermercados enables contactless payments

BM Supermercados, part of Grupo Uvesco, has rolled out contactless payment in all its stores. The retailer said the step will help it to further its digital initiatives. The in-store solution will allow shoppers to pay with bank cards or their mobile phones. BM Supermercados began the digitisation of its offer in 2015, with the launch of its online store, a process that has since seen it now initiate contactless payment and will in future see it introduce wifi in-store and an app.

Announcing its 2016 annual results, where it said gross sales rose 3.9% to €21.6 bn, Spain-based Mercadona has said that it will surrender profit in 2017 to enable it to invest for the future.

FY2016: volume sales rise quicker than value

Mercadona said that while gross sales rose 3.9%, volume sales rose 4.0%, underlining the company’s continued investment in prices. The retailer’s net profit rose 4% to €636m. It invested €685m in 2016 to open 50 new stores, taking its store base to 1,614, update a further 35, build a new distribution centre, a new data processing centre and on a plot of land in Valencia.

Underlining its support of the local economy, Mercadona said it had made purchases worth €16.06 bn in 2016 in Spain, a rise of 4% from 2015. The retailer said it worked with 126 inter-suppliers and more than 500 specialist suppliers. During 2016 Mercadona expanded its range with the addition of 350 products and 300 innovations, such as freshly squeezed orange juice, enhanced 350 products, enhanced its fresh assortment, lowered prices by 1%, in a market where inflation rose 1.6%, and improved services.

Net profit targeted to fall 69% in 2017

Mercadona said that it was expecting to generate a net profit of €200m in 2017, a 69% fall on 2016’s €636m. The retailer said that the expected fall in net profits was down to it wanting to consolidate its position in the market and invest strongly in rolling out its new store design.

Discussing the new look and feel, the company’s president, Juan Roig, said that the retailer was aiming to make the stores feel warmer. The new layout will also provide more space for fresh fruit and vegetables, dedicate more space to fish and make the beauty sections of the stores warmer too.

Mercadona said it would invest between €1.0 bn and €1.2 bn in 2017, with between €200m to €300m to be spent on opening 30 stores and updating a further 126. In 2018 it will update between 200 and 250 stores, while it was targeting 2022 or 2023 to have updated all its stores to the new design. The figure is a strong increase on the amount invested in 2016, when it spent €685m. Mercadona said it expected volume and value sales to rise 1.5% in 2017.

Entry into Portugal and online to receive more investment

As part of the results announcement, Roig said that Mercadona envisaged opening four stores in Portugal in 2019. He stressed that the retailer would look to be ‘Portuguese in Portugal… with a Portuguese assortment’ informed by feedback from local shoppers.

In relation to online, Roig said that the retailer was investigating new solutions for its online store. It is aiming to relaunch its online store in 2018 to grow the share of sales above 1% that it accounted for in 2016. He said that the company was looking to make its online store profitable, an aim that will be driven by Roig’s daughter, Juana Roig.



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See how Mercadona remains a price-focused, efficient retailer as it launches a new, more welcoming and inviting store design in Spain.
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