The opening of Leclerc's organic supermarket in Nice earlier this summer shows the retailer's willingness to keep large stores relevant for today's shoppers.
Here's why we think Leclerc is one of the top retailers to watch in Western Europe.
Continued reinvention of hypermarkets boosts sales
Leclerc's sales in France in 2015 rose by 3.4% (excluding the deflationary effects of falling petrol prices). In contrast to the difficulties other retailers are experiencing with hypermarkets, Leclerc said the format performed strongly and accounted for 55% of growth. The renovation of more than 260 hypermarkets over the past two years has also helped, boosting customer traffic.
Multi-channel strategy means Drive also plays key role
Leclerc's independent store ownership structure is one of its strengths, allowing innovative store owners to push the boundaries of what hypermarkets can offer. Updating existing sites and adding new ones will propel Leclerc's medium term growth. The retailer's offer, and especially its new stores, stand out for great strengths in fresh and value, as might be expected, but never at the expense of quality.
Source: IGD Research
It's not just about bricks and mortar stores. Leclerc is one of the strongest Drive operators in France; sales via the format were up nearly 20% in 2015, despite the pace of new outlets slowing. As the number of new sites has slowed, Leclerc has focused instead on driving profitability.
Range innovation and price leadership
As we can see from the Nice store opening, organic products are a growing focus for Leclerc both from a private label and core range point of view. Individual store owners are increasing the range to meet local shoppers' demands. In the Nice store, located at the Allianz Riviera arena, there are over 9,000 items with a strong focus on Italian products, taking advantage of the proximity to the Italian border.
Source: IGD Research
Leclerc's trading strategy focuses principally on price. At stores' entrances, Leclerc spotlights the savings versus nearby stores to reassure shoppers that they are getting the best prices in the local area; it is a simple, but effective mechanic. To enable shoppers to compare prices, despite being the country's price leader, Leclerc operates a comparison website calledQui est le moins cher? (Who is the cheapest?) across branded and private label goods.
Who else is innovating in Western Europe?
Subscribers can discover more about how Coop Italia, Edeka, ICA, Mercadona and Pingo Doce are driving growth in their home markets, by downloading our insight presentation here.