September 6, 2013

Metro Group's Frans Muller joins Delhaize

photo: Georg Lukas
Smile for the camera: Can Dutchman Frans Muller keep his grin in Brussels?
At first blush it looks a bold and exciting move: Former Metro Group Cash & Carry board member Frans Muller is to become CEO of Belgian food retailer Delhaize as from November 8. By any account the 52-year-old Dutchman is an impressive manager with an excellent reputation in the trade and a cosmopolitan outlook. Past interviews with this newspaper reveal his detailed knowledge of stores and assortments. Muller, who left Metro's troubled C&C division in March, has long survived as a foreign executive at Germany's largest retail/wholesale group. Responsibility for up to 30 countries have given him tremendous insight into managing complex international portfolios. Yet his appointment as successor to Pierre-Olivier Beckers has been criticised by some. So perhaps it could all end in tears, but for none of the reasons given.
August 30, 2013 inspires Rewe

photo: Mario Vedder
Cyber prayer: Rewe CEO Alain Caparros is still looking for the promised online land
True to form, flamboyant and sultry Alain Caparros did not scruple to employ his coquettish charm to make a disarmingly forthright speech at the Hessischer Handelstag (Hessian Retail Day) in Wiesbaden this Tuesday. The CEO of Rewe Group, Germany’s second-largest bricks & mortar food retailer, admitted to mixed feelings about "embarking on the adventure that is online retailing". But the charismatic Frenchman clearly feels obliged to give "clicks" another push for strategic reasons. Or why else would he have recruited former manager Jean-Jacques van Oosten? "We are bringing in the best people on the market," says Caparros who has appointed van Oosten Chief Digital Officer as from December 1.
August 23, 2013

End of the mega malls

photo: Thomas Fedra
Lucrative investment or retail dinosaur: Frankfurt's new Skyline Plaza shopping centre could be one of the last of a dying breed in Germany
On Wednesday, 29th August German property developer ECE will open the Skyline Plaza with 170 shops - a stone's throw away from our editorial offices here in Frankfurt. High commercial real estate prices, ever fewer suitable sites and a boom in e-commerce could make this one of the last big shopping centres to be built in Germany. So is Skyline Plaza just another investment project, or will its fate reflect the deep structural changes underway in modern retailing? The European Retail Institute (EHI) duly records that the nine shopping centres opened in Germany last year had relatively small rental spaces of 10,000 to 30,000 square metres. But ECE boss Alexander Otto also sees potential in larger sites. "The more space there is, the quicker one can react to new trends and find space for an exciting store concept."
August 16, 2013

UK retailers redefine the hypermarket

photo: Tesco
Retail destination: A Harris+Hoole coffee shop forms part of Tesco Extra's revitalised gastronomic offer in Watford
Leading UK retailers are again in the news as they continue to downsize or reassign non-food space in their out-of-town hypermarkets. Mirroring the problems of Wickes and B&Q in the DIY sector, Walmart subsidiary Asda has recently announced plans to use excess store space for communal purposes. And on Monday Tesco officially unveiled a refurbished “Extra” outlet in Watford, near London, showcasing its new ideas on space usage. Clearly the market leader is prepared to move beyond its core competence in food to meet space issues and to enhance its credentials as a retail destination. But isn’t the whole exercise also clever PR spin in advance of eventual closures? And what relevance does it have for continental European retailers?
August 13, 2013

French farmers smash their eggs

photo: acht&siebzig/
Eat them or break them?
In a primaeval revolt against order masked farmers in north-west France began a Dionysian orgy of egg-smashing last week. 100,000 eggs a day have already been dumped outside a Lidl discount store, government offices and village squares around Brittany. Local residents were left with the rotting mass and a hefty clean-up bill on the rates. So the activists have railed against the laws of supply & demand and pulled off a spectacular PR stunt. Doubtless they are now also patting themselves on the back and treating themselves to a Calvados and a Gauloises blonde. But will they reap where they sow?
August 7, 2013

Why retailers insult their customers

photo: Dominic Büttner
Wrong or right: Retailers encourage customers to use smartphones in-store, but do staff know this?
Recent debate in the UK media about a quarrel at a Sainsbury’s checkout is doubly interesting when viewed from a German retail perspective. Apparently, a checkout worker refused to serve a customer at her local branch in Crayford/London because the lady was talking on her mobile phone. “I will not check your shopping out until you get off.” Stunned shopper Jo Clarke then enquired at customer services to find that the lecture on checkout etiquette was not company policy. The 26-year-old property manager duly complained to the store manager, received an apology and an offer of free vouchers worth £10. Game, set and match for the customer? Not quite. The checkout lady's stand for old-world manners has since unleashed a wave of support on social networking sites. The customer has been vilified by thousands as "rude and disrespectful" on Facebook and Twitter.
July 24, 2013

dm and Amazon part company

photo: Gourmondo/DHL
New entrant: DHL intends to offer its own food delivery service throughout Germany by 2015
So dm and Amazon do not intend to continue their online sales co-operation! Germany’s largest drugstore operator and the US online giant have failed to find a viable model to market health & beauty own label. The liaison between anthroposophically-minded dm and big, brash, opaque Amazon was always an unlikely one. And it is difficult to resist concluding that the Americans lacked conviction when promoting the project. The fact remains, however, that two leading international companies, both at the top of their individual game, have not succeeded in wooing tech-savvy consumers in the world’s second-richest country by GDP per capita. What does this tell us about e-commerce in German mass consumer markets? One could argue that the alliance was only a test for both parties, but the words of dm CEO Eric Harsch aren't exactly encouraging for online shopping enthusiasts:
July 5, 2013

Éclat at Tesco

Sir Terry Leahy, ex-Tesco CEO (photo: Anna-Maria Romanelli)
Yesterday's hero: Former Tesco CEO Sir Terry Leahy
The events at Tesco’s annual meeting in London last Friday have been generally received with astonishment here in the German trade. The spectacle of former Chairman Ian MacLaurin publicly demolishing the legacy of ex-CEO Terry Leahy, the very man he once groomed for the job, was certainly unedifying. But the dismantling of the reputation of a demigod almost beggars belief. Clearly, something has gone very wrong at a company which some top German retailers use as their international benchmark. Lord MacLaurin’s surprise speech resembled the eruption of a volcano on the coast of Patagonia long believed extinct. The titan of yore seems to have flown in from retirement at the golf club in Spain to intervene with devastating effect.
July 5, 2013

Aldi goes British

photo: The Grocer
Aldi UK top brass: Matthew Barnes, Tony Baines and Roman Heini
After 23 years of hard slog, it would seem that mega-rich Aldi has finally won the hearts & minds of the UK High Street. The German discounter has beaten local giants Tesco and J. Sainsbury to win "The Grocer of the Year Award". At all events it is illuminating to see members of its secretive management in bow-tie at London's historic Guildhall - without turned-up collars and dark glasses. The annual prize awarded by The Grocer is nothing less than a knighthood for the Aldi Süd subsidiary which has been growing far faster than the overall market over the last two years. According to market researchers Kantar, annual sales growth has averaged 30 per cent throughout 2013. Aldi's 500-odd stores now have a 3.6 per cent share of the UK grocery market outpacing rival Lidl (3 per cent). Here in Old Germany, one is a little surprised, however, at the explanations behind the decision of the judges.
June 27, 2013

Asda reassigns store space for community use

Andy Clarke, CEO Asda/Walmart (photo: The Daily Telegraph)
Andy Clarke: "We want our stores to be at the heart of their local communities"
Now didn’t Robin Hood also come from the North of England? Asda’s plan to offer excess out-of-town hypermarket space to local communities has stirred debate in the UK and even triggers echos of Swiss retail visionary Gottlieb Duttweiler*. As the Leeds-based Walmart subsidiary, with estimated 2013 revenues of €30bn, is the UK’s second-largest retailer this obviously carries weight. CEO Andy Clarke’s decision reflects a number of major trends: The growth of online, convenience and discount shopping; the difficulty of selling general merchandise in big-box food stores; a “space race” and land bank legacy with too much store footage chasing too few consumers in a long recession. Lebensmittel Zeitung also asked Clive Woodger, Chairman of brand consultants SCG London, to assess Clarke's ideas. As a retail architect at design company Fitch over 20 years ago, Woodger was instrumental in developing Asda’s “Superstore of the 90s” in the middle of the space race. Meanwhile, as Germany is far more overstored than the UK, shouldn't we also be talking about Asda's initiative here?