August 27, 2015
Luis Cantarell: "Let's make the cake bigger!"
Executive Vice President Luis Cantarell is a veteran of nearly 40 years at Nestlé. This pleasant and entertaining 63-year-old Spanish manager is an old hand in a new role since his appointment as Head of Zone EMENA (Europe, Middle East & North Africa) in October 2014. This follows a long management career that has included stints at the Swiss food giant's Nutrition and Health Science as well as Coffee & Beverages units. Men are always the sum of the things they have met, but Cantarell would probably be the first to agree that his three years as head of Nestlé's "Zone Americas" from 2008 to 2011 were particularly formative. The polyglot executive has now returned to Old Europe, but remains impressed by the optimistic "can-do" attitude he encountered in American business circles. And a man who can make informed comparisons on a global scale is inevitably a man with attitude. Cantarell also has something to say about saturated markets, international retailer alliances, and Wagner pizza at Aldi.
August 20, 2015
Glamorous advertising, scene 1: Aldi Men's Marl Zipped Hoody
Aldi Stores Ltd is getting hipper by the month. This summer's range of menswear fashion wouldn't be new to Germany, but it is a first in the UK. As such, it has caught the imagination of the local media, including that bastion of the British middle-class, the Daily Mail. In addition to buying food staples at the German discount giant, male shoppers can now trendy themselves up with stunningly priced Chino shorts, Oxford shirts, linen trousers, T-shirts, casual padded sandals, summer hats, and zipped hoodies. The rock-bottom prices certainly make competitors such as Marks & Spencer or next look decidedly uncool. The range went in store on 19th July and was only available while stocks lasted. The tremendous success of this "Specialbuy" is shown by the way our mystery shoppers couldn't find one item in the English stores they visited at the beginning of last week. But they also confirmed how the Aldi system tolerates clothing to be merchandised as the day progresses. Any shorts were only in bargain bins, and the display of its popular "Back to School" uniform range looked pretty lacklustre. So is Aldi winning new customers with its special fashion offers only to turn them off and away once they get there?
August 13, 2015
Markus Mosa: "Alidis is now the biggest alliance in European food retailing"
Around once a decade, retailers seem to become nervous and start joining or changing European buying groups – much like the spasmodic migrations of birds. Usually, this can be attributed to some development that has ignited change, such as the signing of the Single European Act in 1986. The most recent shuffling of the cards, however, doesn't seem to have any such obvious reason. In fact, retail partners have been so frequently jumping in and out of bed with each other of late that one would call them promiscuous had one's maiden aunt not also been a reader of these columns. What is one to conclude from these increasingly frequent changes in membership? Although the good old fun of bullying suppliers for ever more advantageous terms & conditions may unite retailers for a while, it would seem that they often can't stand life together for any lengthy period. But Markus Mosa, CEO of Germany's largest retailer Edeka, is confident that Alidis and its buying arm Agenor have a stable future. Edeka joined the alliance in 2005 which has now been considerably strengthened by the accession of former Rewe partners Colruyt (B), Conad (I) and Coop Schweiz (CH). Together with Eroski (E) and Intermarché (F), Alidis members will combine whopping annual revenues of €140bn in eight countries. Is now Rewe Group CEO Alain Caparros hopping mad about losing three former allies to archrival Edeka, or delighted to be free of the ballast and the nitpicking coordination?
August 7, 2015
Neela Montgomery: "Some of my businesses need corrective action, and you don't do turnarounds at a slow pace"
As a woman, Neela Montgomery, executive board member at Hamburg-based Otto Group, is regrettably still quite a rarity in German retail c-suites. But any gender talk obfuscates her commanding credentials for her important new task: the restructuring of Otto Group's most important business division, Multichannel Retail. A glance at her CV suffices. Montgomery is a veteran of world-leading Tesco.com and has worked for the UK grocer in a variety of senior management roles in a number of countries, including Malaysia. As such, the lady is a good fit at Otto Group whose 123 companies are active in more than 20 countries. Montgomery's new fief embraces group companies in Germany and abroad that sell their goods through catalogues, e-commerce, and in over-the-counter retail. The range includes fashion, footwear, lifestyle accessories, furniture, interior décor items, and toys, as well as technology, sport and leisure products. So what can the new girl on the block bring to the game?
August 6, 2015
Grant Winterton: "We regard Germany, France and the UK as emerging markets"
If your company name is Russian Standard and you make vodka in St. Petersburg, then you are unlikely to have authenticity problems with local or global consumers. So it almost seems superfluous for the corporate website to market the Russianness of its premium brands. There we learn that its winter wheat comes from the Steppes; its quartz (used for filtration purposes) is taken from the Ural Mountains; and its spirits are blended with water from Lake Ladoga. Doubtless Global CEO Grant Winterton (45) would have preferred to have only discussed brand leadership in Mother Russia and the conquest of foreign bars and drinks tables. But even an Australian manager must accept that a business so quintessentially Russian cannot divorce itself entirely from manspreading Uncle Vlad and current West-East relations. This is a pity because the brand founded in 1998 by Roustam Tariko, the billionaire owner and chairman of Russian Standard Company, has a Soviet-free identity. It also represents one of the big success stories to emerge from the vibrant market of 1990s Russia with a 40 per cent share of the local premium vodka market.
July 29, 2015
Goodbye barcodes as we know them: The POS of the future
Roll up, roll up for a wonderful piece of retail magic – Digimarc will now make your bar codes disappear. What sounds like part of a David Copperfield show is apparently not magic at all. The Beaverton/Oregon-based company has come up with a way to make barcodes invisible and thus revolutionise what was once itself a revolutionary technology when the UPC was introduced 50 years ago. According to Digimarc partner and imager maker Datalogic, the new digital watermarking process could speed up scanning time by a least a third and therefore the whole checkout process at your local store. The innovation is currently being tested by Walmart in its innovation Lab 415-C and has been praised by CEO Doug McMillon, which in the retail world is akin to being knighted by the Queen. Wegmans already prints the digital watermarks on its own label products. "The technology allows scanners to immediately read from as many as 200 invisible barcodes all over, for instance, a box of cereal," says Digimarc boss Bruce Davis. This represents a great improvement on the conventional method of one barcode per package for 10m items world-wide. Davis is bullish about his new technology and also believes that checkouts could be eliminated entirely when shopping trolleys are equipped with scanners. This in turn could equate to substantial annual labour cost savings for the retailer. Sounds like a good ROI?
July 23, 2015
Christian Haub: "A&P helped us to really understand the US consumer market"
The sad fate of historic and now insolvent US supermarket retailer A&P will provide students at Harvard Business School with study material for generations to come. It is certainly remarkable how the Great Atlantic & Pacific Tea Co., a household name in America with more than 15,000 stores, eventually crumbled into a small regional multiple only to file for Chapter 11 again this year. Although the Haub family exited A&P for good in 2012, their name had been inextricably linked with the company for over three decades. The owners of Germany's seventh-largest retailer Tengelmann Group have long gone on to pastures new and are currently reinventing themselves as an important investor in internet start-up companies. So theoretically they could just wash their hands of A&P and refuse to comment. However, Lebensmittel Zeitung judged Tengelmann partner Christian W. E. Haub rightly in that he did have something to say about the fate of the proud company he once presided over.
July 9, 2015
Paolo Barilla: "You can't buy international experience at the supermarket"
Barilla Group is living proof that more than ham comes from the delightful northern Italian town of Parma, which has been home to the Italian pasta maker since 1877. Vice-Chairman Paolo Barilla (51) is one of the three siblings who have majority control (85 per cent) of this privately-owned company. His older brother Guido is Chairman; his other brother Luca is a fellow Vice-Chairman. Having interviewed Guido Barilla almost six years ago to the day, it would seem that Lebensmittel Zeitung is gradually getting to know the whole family. Admittedly, talks could have been more frequent as the brotherly trio has quite an entrepreneurial tale to tell. Like the three musketeers, they have had their fair share of bumps and bruises since deciding to go international in 1993. Shakespeare once wrote: "Experience is a precious jewel and it hath needs be so, for it is often purchased at an infinite rate." For the Barillas this infinite rate was the purchase of German baker Kamps at the inflated price of €1.8bn in 2002. So how come they still like Germany?
July 9, 2015
Heat-resistant chocolate: Melts in your mouth, but not in the shop window
The current heatwave in northern Europe isn't too good for chocolate sales, which have plunged over the last few sweltering days by a staggering 30 per cent. But for researchers at the Global R&D Centre of Barry Callebaut in Wieze/Belgium the weather simply can't be hot enough. A few days back, our newspaper caught ten of them standing around two chocolate bunny rabbits as they watched with childlike glee how one melted under an infrared lamp at 38°C and their one didn't. But what looks like a scene from Sesame Street is really big business for the world's largest manufacturer of cocoa and chocolate products. The Zurich-based group already makes a third of its €5bn annual sales in threshold economies and wants to boost business with them. But when you market a product which is supposed to dissolve in the mouth, it is hardly suitable for most shop windows in Africa, Latin America or Asia. So thermo-tolerant chocolate could be the intriguing answer. Heat-resistant bunnies are, however, just one of the lines that Barry Callebaut has been able to create with unique functionalities. Although the company is loath to specify annual R&D spend, innovation is clearly a strategic enabler for future growth. In fact, an astonishing 70 per cent of all revenues are generated by products that have only been developed over the last five years.
July 3, 2015
Last resort for Greek consumers: While politicians and corrupt elites squabble, unpretentious Lidl offers the people a square deal
As smirking Finance Minister Yanis Varoufakis plays Easy Rider on his motorbike and Merkel, Schäuble, Lagarde and Juncker look grimmer by the hour for the camera, the Greek tragedy unfolds apace. Nemesis here takes the ugly form of more than €320bn in unsustainable debt. Regardless of the outcome of the national referendum on the international bailout this Sunday, there is no doubt as to the protagonist: the Greek people. Forced to choose between the bitter cups of chaos or further decades of grim austerity, like the tragic hero of old, they seem damned whichever way they turn. It is an ill wind indeed, however, that blows nobody any good. The tormented country may be grinding to a standstill, but the 220 discount stores of Lidl Hellas continue to do a rip-roaring trade. So it must come as an irony for those Greeks who see the German financial machine as their oppressors that it is a German retailer who gives them the best bargain on the High Street.