German retail top dogs
One thing is for sure, Germany is currently an Isle of the Blessed for local retailers who have not had to contend with the severe recessionary problems of their European counterparts.
Last year, Germany's food retail universe increased by 1.8 per cent to a whopping €228bn. This may represent a decline in the growth rate compared with 2010 (+2.3 per cent), but it is still the second positive year in succession.
Already high concentration levels continued to increase slightly. The Top 30 players now make up 97.5 per cent of the total market, and smaller operators such as Ratio have disappeared from the ranking altogether.
But this doesn't mean that the big guys don't have their problems. Metro Group revenues slipped for a second year (-0.6 per cent) in Germany with "real,-" hypermarkets falling 1.1 per cent and its Cash & Carry division 4.4 per cent. Sales also declined at the company's "Kaufhof" department stores. Are you sure you don't want to sell something, new CEO Olaf Koch?
Edeka still kingpin
Edeka, which increased annual group revenues by 4.1 per cent to €47.2bn, remains kingpin. The main growth of the Hamburg-based retailer co-operative-cum-discount-multiple was achieved by its independent supermarket operators.
In general, no. 2 food player Rewe also had a good year, but 2011 figures were negatively impacted by the sale of its 50 per cent stake in Cash & Carry/food service operator Transgourmet Deutschland (annual revenues: €2.9bn) to joint-venture partner Coop Suisse.
However, the Cologne-based company has not lost buying volume as it will continue to deliver Coop Suisse in Germany. Also, Rewe's main supermarket division has profited from expansion, greater price aggression and longer opening hours.
Generally good year for discounters
Meanwhile, discount subsidiary "Penny" remains a problem, and around 140 smaller outlets are due for closure this year. Currently, the company is revamping its 2,400-odd store base and rolling out a new concept with brighter store designs and better-quality fresh produce.
Otherwise, Germany's hard discounters had another good year. Schwarz Group (Lidl plus discount hypermarket arm Kaufland) and Aldi Group (Aldi North & Aldi South) gained 2.1 per cent and 1.2 per cent, respectively.
Dansk Supermarked subsidiary Netto Nord (+1.4 per cent) and the eponymous Edeka-subsidiary Netto (+3 per cent) also increased annual revenues. Even a slightly-recalibrated Norma (+1 per cent) and a struggling Penny (+0.4 per cent) managed to grow sales. So much for the pundits who proclaimed over ten years ago that discount had already passed its zenith!
Feeding frenzy on Schlecker
There were big changes in the drugstore segment. Schlecker, which filed for insolvency this January and whose fate will be decided by insolvency court next week, lost 7 per cent, while rivals Rossmann (+12.2 per cent), dm (+10.1 per cent) and Müller (+7.1 per cent) forged ahead.
These fulminant results were only beaten by natural & organic food supermarket operators Dennree (+19.5 per cent) and Alnatura (17.9 per cent). Clearly, these specialists have read the sign of the times as well as the hearts and minds of German consumers.