July 4, 2019
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...
June 7, 2019
Store front in China's largest city
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
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
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
It used to be fun being one of the boss men, but not if you work at Schwarz Group these days. Klaus Gehrig, the powerful figure 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...
March 12, 2019
Brexit jigsaw puzzle
If all goes to chaotic plan, we are now only days away from a potentially 'hard' Brexit. This will bring either freedom or Armageddon depending on your point of view. Many retailers didn't want to talk about such a divisive subject for their customers and staff, even off-the-record. This is understandable as the UK's current torment is completely out of their hands. Although we are convinced that Theresa May, Boris Johnson and Jeremy Corbyn secretly read Lebensmittel Zeitung, we also couldn't find a politician who wanted to chat. This is most unusual for a generally loquacious breed, especially as we also offered them tea and scones. On the eve of three House of Commons votes this week, we therefore turned to a prominent legal-eagle for 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...
March 7, 2019
Emergencia: L1 Retail evidently sees itself as part of Spain's retail fire brigade
Let us take a Ukrainian-born Russian oligarch and call him Mikhail Fridman. Let this self-made man set up an investment holding in London (LetterOne) with a retail arm in Luxembourg (L1 Retail). Let him invest €700m for a minority stake in Spain's fourth-largest grocer, Dia. Then watch the share price of this soft discount-proximity retailer crash by more than 90 per cent on the Madrid stock exchange within a year. How happy would you be, dear reader, if you were he, and what would you do to extricate yourself from this mess?
March 1, 2019
The future is already here...in Erith!
No, it's not Star Wars. Luke Jensen, CEO of Ocado Solutions, may be master over an army of robots. But, instead of going over to the dark side, these hard-working chaps will commission your online food orders in just a couple of minutes at one of the online retailer's three highly-automated giant warehouses. Our sky-walking reporter Sabrina Schadwinkel jumped on her space buggy for a short hop from Frankfurt to Erith, just a tad south-east of London, to have a look at Ocado's latest and largest so-called Customer Fulfilment Centre. Its two hives are each the size of three football pitches. When fully ramped up, they will have 750,000 storage locations managed by a swarm of more than 3,500 robots. The Erith site, with its chilled, ambient and frozen temperature zones, is expected to achieve annual sales north of £1bn. Nearly a third of this capacity will go to Morrisons, the UK's fourth-largest grocer by revenues. Given that Ocado has also just agreed a joint venture with British retail icon Marks & Spencer, let's have a chat with Mr Jensen on why international retailers should buy all this classy high-tech...
February 28, 2019
Love birds: The union between Ahold and Delhaize looks both increasingly happy and profitable
Surely this is the stuff Board bonuses are made of? Dutch-Belgian retail giant Ahold Delhaize has just announced a spanking set of results for 2018 and ambitious plans for 2019. In the second full business year since the two companies merged in July 2016, net revenues reached a whopping €62.8bn, while free cash flow grew by nearly a quarter to €2.3bn. The Zaandam-based grocer now runs a vast bricks & mortar empire with 6,770 superstores, supermarkets and convenience stores in the Benelux, Central & Eastern Europe and the US. This reflects the long traditions behind Ahold and Delhaize as retail brands. But the new company is also using its annual capex of €2bn and beyond to pursue an omni-channel strategy via click & collect as well as home delivery services Bol.com and Peapod.com. Net consumer online sales on both sides of the Atlantic have now reached €3.5bn. Given these impressive results, we asked CEO Frans Muller how he intends to top them in 2019...
January 31, 2019
Brainbox behind the Big Box: Il-Soon Lim
Everyone, even Donald Trump, knows that the focus of human civilization is rapidly returning to its historic cradle in Asia. The ingenuity and diligence of its vast population have brought the region to the fore once more – a process only accelerated by the globalization of the world economy and the advance of the internet. One of the most fascinating cultures in Asia is undoubtedly South Korea, and it is no coincidence that local retailers are the most advanced internationally in e-commerce. A leading figure in the Korean trade is Il-Soon Lim, CEO of Homeplus. The country's second-largest retailer has just given a big shot of Asian expertise to international buying group European Marketing Distribution (EMD)...