European food retailers in emerging markets - Food Industry Report
Released on = December 8, 2005, 1:52 am
Press Release Author = Parko Food
Industry = Food & Beverage
Press Release Summary = The past few years have seen many of Europe\'s largest food retailers moving into new and emerging markets. According to the Institute of Grocery Distribution\'s (IGD) Global Retail Index, the French group, Carrefour, tops the list, due to its `wide international presence and its strongly internationally focused corporate strategy\'.
Press Release Body = FOR IMMEDIATE RELEASE 08.12.2005
One of the joys of taking a holiday to Asia is the opportunity to spend a couple of hours in a local market taking in the sights and smells. But times are changing. Today, European visitors are stepping off their plane and coming face-to-face with hypermarkets bearing familiar names such as Tesco or Carrefour.
The past few years have seen many of Europe\'s largest food retailers moving into new and emerging markets. According to the Institute of Grocery Distribution\'s (IGD) Global Retail Index, the French group, Carrefour, tops the list, due to its `wide international presence and its strongly internationally focused corporate strategy\'. Carrefour currently boasts more than 9 000 stores in 31 countries. During 2001, it opened 342 new stores worldwide and acquired a further 183. In January 2002, it opened twelve more.
While the majority of European food retailers still see their home market accounting for the majority of sales -- in the case of Carrefour, 49.3% of sales come from France -- the increasing maturity of European markets sees food retailers looking elsewhere for future sales.
\"Today, the market in developed countries is well served by food retailers and is therefore highly competitive. Hence, it is difficult to increase sales and maintain profit margins,\" says Alastair Charatan, head of retail at PA Consulting. \"Conversely, emerging markets are, by definition, countries where there are increasing numbers of customers prepared to pay a premium for modern grocery retailing -- rather than frequent visits to markets and smaller outlets. This, therefore, provides an opportunity for retailers to apply their expertise and establish a larger market share.\"
While Carrefour, Ahold, Wal-Mart and Metro all retained their top four positions in the IGD Global Retail Index for 2001 -- Tesco has pushed into the top five, reinforcing its image as an international player. \"At Tesco, we have four clear goals -- to strength our UK core business; to develop into non-food products; to develop other areas, such as financial services; and to expand internationally,\" says Tesco\'s international corporate affairs manager, Ian Hutchins.
Central and eastern Europe has already attracted a large number of foreign retailers. Tesco entered the Hungarian market in 1995, where it now has 48 stores (21 of which are hypermarkets). Since then, it has also gone into Poland (47 stores), the Czech Republic (15 stores) and Slovakia (13 stores).
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