November 28, 2019

Frans Muller talks Ahold Delhaize

Ahold Delhaize CEO Frans Muller (photo: Philipp von Bruchhausen)
Frans Muller
Frans Muller may be a mild-mannered gentleman with a pleasing dash of humour, but he's a frustrating CEO to interview. He won't tell you whom Ahold Delhaize wants to buy next or if the Dutch retail giant intends to do a spin-off! As a matter of honour, he won't even talk about one of his former employers, Metro Group. But as disappointing as these silences are to the journalist, the more one is grudgingly obliged to respect the man's loyalty to shareholders and corporate governance. Before we praise this 58-year-old Dutchman to death for not delivering the crown jewels free-of-charge to our doorstep via the company's online services Peapod or Bol.com, why should you, dear reader, peruse these lines further? Perhaps through an innate sense of politeness at not being able to field share price-sensitive questions, Muller was prepared to talk generically about the strategic issues he faces at the helm of this €63bn-odd behemoth...
November 28, 2019

Mayhem on the UK High Street

Scene on a UK High Street (photo: onflilm_iStock by getty images)
Ready for the tumbleweed?
As most UK retailers prepare for a probably not so merry Christmas and further Brexit uncertainty, German trade visitors from across the North Sea look with astonishment at the numerous store closures on the once vibrant UK High Street. Those with any imagination, however, have no sense of schadenfreude. Although the online share of German retailing has not reached anywhere near UK levels, one doesn't exactly need a crystal ball to know in what direction things will inevitably go. It is therefore almost an act of self-preservation on the part of German retailers to try and understand what is happening among the Anglo-Saxons. Clearly, if we exclude the disruption caused by the relentless rise of discounters Aldi and Lidl, many shoppers are buying increasing amounts on the internet. So, without any pretension to statistical relevance, we thought we would ask some younger British consumers on the eve of Black Friday why they prefer surfing cyberspace to walking through the urban jungle...
August 15, 2019

LZ American summer tour: Talk with Facebook

American dog, LZ summer tour II (photo: Javier Brosch/Shutterstock.com)
On the second part of our annual summer tour, Lebensmittel Zeitung's feature page editor Mathias Himberg spoke with Carolyn Everson, Vice President Global Marketing Solutions, at Facebook. With its communication platforms Instagram and WhatsApp, Facebook is one of the world's largest internet companies. Founded by eternally preppy Mark Zuckerberg, Facebook has mainly used advertising to nearly quintuple annual revenues from $12.5bn to $55.8bn over the last five years. Net earnings have grown even more extravagantly from $2.9bn to $22.1bn during the same period. But what would any Silicon Valley tech giant be these days without a good old-fashioned scandal? Facebook has not failed us and has duly broken the 11th commandment: "Thou shalt not get found out."
July 26, 2019

Carrefour-Casino and the elephant marriage

Elephant marriage (photo: nattanan726/Shutterstock)
The mating of elephants is a surprisingly delicate business. These pachyderms are said to be exceedingly coy and, despite their huge size, take fright easily. The same would seem to apply to French retail giants Carrefour and Casino who are believed to have had a tiff on their first date last autumn. If trade gossip is to be believed, Carrefour CEO Alexandre Bompard and Jean-Charles Naouri, the main shareholder of Casino, met at the home of illustrious matchmaker Alain Minc. Both Bompard and Naouri are internationally renowned figures, but you probably won't know Minc. This is because 'le grand Alain' deliberately cultivates a low profile despite, or precisely because of, his legendary business and political contacts. One thing is for sure, though, you only do big things with Big Alan, and it is highly unlikely that the three gentlemen convened to play tiddlywinks. But did this trio ever get together at all? At least one of the parties involved claims that there was no such meeting, two of them have argued publicly as to who approached whom first. This is all very amusing and a field day for journalists, but doesn't really help us further. The whole matter can and should, perhaps, be archived under the title 'curious stories'. Over the last few weeks, however, speculation has again flared up in Parisian financial circles that informal contacts may have restarted...
July 4, 2019

LZ American summer tour: Talk with Google

American dog (photo: Javier Brosch/Shutterstock)
Despite Donald Trump, escalating trade wars and tough competition, the sheer size of the American retail market never fails to attract. According to the Food Marketing Institute, the US counts 38,300 stores, 4.8m employees and annual sales north of $700bn. America is also a melting pot of ideas and home to so many Silicon Valley innovators who have forged today's digital revolution. As part of our annual summer tour, LZ editor Mathias Himberg visited the land of seemingly endless opportunity. His first meeting was with Daniel Alegre, President for Strategic Partnerships in Commerce & Retail, at Google HQ in Mountain View, California. Their talk ranged from cooperation with French retail giant Carrefour to how the company entered online retailing and the potential behind voice-controlled systems. In 2018 the online behemoth posted sales north of $136bn. The lion's share (85 per cent) came from advertising revenues. Its cyberspace empire includes Google Maps and the video portal YouTube. Net profit came in at a staggering $30.7bn. The share price of Nasdaq-listed parent-company Alphabet, Inc. has been treading water since the beginning of the year but has nearly doubled since 2014. For some Google is a hero of the internet economy. Others criticise the online giant as an intransparent monopolist with a patchy record on data protection. Love it or hate it, there is no way around it...
June 7, 2019

Shanghai welcomes Aldi!

Aldi Shanghai, store front (photo: Andrew Meredith)
Store front
Thought our readers would like to see some photos of Aldi's first two stores in the People's Republic of China, which opened this morning in Shanghai. We also managed to glean a few statements from country manager Christoph Schwaiger in between paring the cheese, counting the olives, and swabbing down the counters. Meanwhile, if you go shopping there, don't forget to drop us a line...
May 29, 2019

Aldi gets physical in China

Aldi Shanghai at Jingan Sports & Fitness Center (photo: LZ Archiv)
Upmarket location: Aldi is celebrating its debut in China as a tenant at the Jingan Sports & Fitness Center
In only days from now Aldi will be starting business in the People's Republic of China. The German discount giant's first store will open in Shanghai on June 7. According to information obtained by Lebensmittel Zeitung, a further nine outlets will follow there soon. The first two sites, one of which includes a tenancy in the Jingan Sports & Fitness Center, are in noticeably prosperous neighbourhoods. Although Aldi is said to want to proceed cautiously during the pilot phase, our newspaper expects the medium-term store count to reach 50 to 100 in order to obtain the necessary economies of scale. Persons who claim to be familiar with the concept describe it as "more modern than company stores in Europe". Under the slogan 'Everyday value – Handpicked for you', the global discount pioneer will be offering a considerably more up-market proposition than at any of its other foreign markets. The convenience-oriented assortment will apparently feature many import goods from Europe, including the dairy products and cosmetics much loved by Chinese consumers. This represents a major departure from long-established company practice.
April 17, 2019

LZ Retailytics ranks Europe's Top 50 retail stars

Winner of the trophy (photo: Annette Shaff_Shutterstock)
Who won the European retail cup in 2018?
If this were football, Schwarz Group would be FC Barcelona, Real Madrid or ManUnited. The owner of German discounters Lidl and Kaufland has again won the European retail cup, as compiled by Frankfurt-based analyst platform LZ Retailytics, with whopping annual gross sales of €113bn in 2018. French giant Carrefour is still runner-up, but has continued to lose ground to Aldi. UK grocer Tesco, supercharged by the purchase of leading local wholesaler Booker, stays number four. German supermarket giants Edeka and Rewe thrive in fifth viz. sixth place. With the exception of Metro, whose sales were burdened by currency rates in Mother Russia, all eight German players in the Top 50 league have continued to grow, with five of them among the Top 10. In an industry that has become, for better or worse, a game of large numbers, this isn't particularly remarkable. Germany is, after all, the biggest market in western Europe. So were there no surprises in all this sexy trade data?
April 4, 2019

Lidl culls its bigwigs, but can't stop growing

You're fired! (photo: ojogabonitoo/iStock by Getty)
It used to be fun being one of the boss men, but not if you work at Schwarz Group these days. Klaus Gehrig, the mighty figure of power running the German retail giant founded by secretive entrepreneur Dieter Schwarz, seems to revel in home-made creative disruption. In increasingly frequent purges the 70-year-old corporate veteran regularly gives his top brass the chop, regardless of their sales achievements. No one is sacrosanct and no one is spared, if they question the general partner's structural changes. In an unmistakable power shift from operations to the consultative committee headed by Gerd Chrzanowski (47) at HQ in Neckarsulm, top managers are often obliged to vacate their offices so abruptly that no immediate replacement can be found. Only three weeks ago, Patrick Kaudewitz, CEO of hypermarket subsidiary Kaufland, had to make his goodbyes; now it is the turn of Jesper Højer, CEO of discounter Lidl, to say his sad farewells. Ignazio Paternò, a former head of Lidl Italia and currently deputy director of purchasing at Lidl Foundation in Neckarsulm, will assume Højer's role on an interim basis. The new supervisory body Schwarz Treuhand (SUT) is expected to make this arrangement permanent as early as this spring. But, at the current rate of survival, Paternò will last only two or three years. We all love to moralise and journalists more than most people. It would be immensely satisfying to write how the arbitrary ruthlessness of Klaus Gehrig is ruining the company for good and all. But this would create a false causality. In fact, with sincere apologies to both idealists and the tender-hearted, the very opposite would seem to be the case...
March 12, 2019

Could this be Brexit breakthrough week?

Brexit jigsaw (photo: destina_fotolia_109198388_M )
Brexit jigsaw puzzle
If all goes to chaotic plan, we are now only days away from a potential 'hard' Brexit. This will bring either freedom or Armageddon depending on your point of view. Many retail managers didn't want to talk about such a divisive subject for their customers and staff even off-the-record. This is understandable as much of the UK's current torment is completely out of their hands. Although we are convinced that Theresa May, Boris Johnson and Jeremy Corbyn are secret readers of Lebensmittel Zeitung, we also couldn't find a British politician who wanted to chat. This is most unusual for a generally loquacious breed, and we even offered them tea and scones. On the eve of three House of Commons votes this week, we therefore turned to a prominent legal-eagle in the hope of some enlightenment. One well-known commentator in both media and academia is Thom Brooks, Professor of Law & Government at Durham University. So we asked him to get out his intellectual machete and hack a path through the Brexit jungle for our readers...