Germany: Penny starts new super discounter format

Updated: May 27

Discount retail chain Penny (owned by the German REWE Group) wants to get more market shares from Aldi and Lidl. To this end, the company is increasingly experimenting with a kind of super discounter. Penny relies on a mixture of supermarket and discounter. Such a concept has already celebrated its successful debut in Munich.


Penny has already converted 130 of the almost 2,200 stores in Germany. By the end of 2021, 600 stores should have adopted the new concept. Stefan Magel, Divisional Director Retail Germany of the Rewe Group, describes Penny's market hall concept as a "super discounter".


The thought is not new. Aldi and Lidl rely on similar accents and have had good experiences with it. The shopping experience is increasingly coming to the fore in the post-Corona era.


What's new in the Penny stores?

The changes are already noticeable in many places. In these stores, Penny focuses on freshness, a neat overview and lots of organic goods. As the "Lebensmittel Zeitung" reports, almost 25 to 30 vegetable and fruit items with organic certification are to be sold in the super discount stores. In total, Penny offers up to 180 such articles at full capacity.


The fresh food counter is right at the entrance, as is the case with most supermarkets. The idea behind the placement: Fruit and vegetables create the impression of freshness, which is burned into the minds of customers in the long term.


Customers should find the goods more clearly. Instead of stacked boxes of groceries on wooden pallets in the shops, customers can now find modern shelves. The usual discount store concept has finally had its day.


These modern shelves are no longer lengthwise and in rows inside the shop, but are arranged according to categories. Customers are guided through the branch like a labyrinth. The jam, muesli and coffee department can be found under the heading Breakfast in a U-shape. Additional purchase incentives are then created with display stands. This idea is originally known from furniture stores like Ikea or Mömax, which repeatedly show offers and thus invite you to shop.


You won't find any classic deep-freeze counters in the new Penny branches. Meat, frozen vegetables and frozen pizzas are stored in freezer shelves that can be opened automatically or manually. The concept was established by supermarket parent Rewe. Thanks to the modern appearance, significantly more people are accessing it.


Penny, Aldi, Lidl and Co .: Why are discounters prettier?

For many decades, the price was the focus of discounters. Consumers bought there because food was considered particularly cheap. Ever since supermarket giants put a lot of pressure on the discounters with no-name goods, Aldi, Lidl and Co. have been looking for ways to create new incentives.


In the past, Aldi has increasingly included A-branded products in its range. Penny presented itself as a retailer from the neighborhood and arch-rival Lidl rebuilt branches, staged itself in commercials as the first point of contact for quality and organic.


The industry is at odds over how Corona is affecting efforts overall. Retail experts firmly expect that prices will come into focus again and that one-stop shopping will continue to prevail.


"That could stimulate the price war again," emphasizes an insider. "Customers then look where it is cheapest and where they can get the most groceries."


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