Discount Retail Chain Hofer Austria (owned by the Aldi Süd group) products of the new own German brand "Rettenswert" (translated in English 'worth to rescue') are available against food waste. The discount has been received by a partnership with the Vienna start-up. For this purpose, fruits and vegetables that would be lost are brought back to the circulation and processed. According to discount, it is not just about crooked cucumbers or fruits that are too small, too big, too ripe or too much. Surpluses, whether on the field, in logistics or production, would also be processed. The product range of the new own brand: fruit spreads, pestos and chutneys. “The goal of rescue value is to make a contribution to the environment in the long term and to save millions of kilos of food. As the first food dealer, which saves surpluses from the entire upstream value chain, we are a key to this in the industry. Customers, in turn, receive flawless products and thus protect the environment with Hofer by reducing food surpluses. Cooperation with the unsupply is the ideal addition for Hofer to further contain food waste,” said Horst Leitner, CEO Hofer about the new own brand. See here for more: https://regal.at/news/2022/10/hofer-launcht-neue-eigenmarke?utm_campaign=KW%2042%2F22%202&utm_medium=email&utm_source=Mailjet

Discount Retail Chain Basalt (owned by Salling group) gets after just a week a clearer picture of customers' favorites in the new discount chain. Customers who have visited Salling Group's latest discount store concept 'Basalt' for the past week are targeting a number of items. At the top are four items that can be bought cheaply in the store. The most popular items based on all shops are toilet paper, bananas and peeled tomatoes. It reveals Salling Group. According to chain manager Henrik Nielsen, he was expected to say that he says to Helsingør Dagblad. But one last item surprises him. Cooking oil has been particularly popular in Helsingør. 'It has surprised us. We knew it would sell well, but that it would go up and become a case load-product. We hadn't seen it coming', says Henrik Nielsen to the newspaper. He explains that there are rarely offers of just rapeseed and sunflower oil in the regular discount stores, and therefore the price of oil in Basalt in the eyes of the customers. When Basalt opened just over a week ago, they promoted to be 15 percent cheaper on average. In a test conducted by TV 2 East Jutland, it turns out that there is something to save if you buy basic goods. A purchase of pasta, rice, flour, oatmeal, tuna, potatoes and peeled tomatoes in Aldi and Coop365 costs 70.8 (US$9.39) and 70.5 (US$9.35)kroner respectively. At Basalt, customers only have to pay 57.85 (US$7.67) for the same, which is ca. 18% cheaper as other Dannish discount retail formats. See here for more: https://www.seoghoer.dk/dine-penge/ny-discountkaede-afsloerer-populaert-udvalg-en-vare-overrasker

Inflation changes the store behavior of the Belgian. 7 out of 10 say that they have been actively comparing prices between supermarkets since the start of the inflation wave. To enjoy the lowest possible price, the Belgian more often combines different supermarkets. He can therefore be found more with the discounters, according to an Ivox study. The Belgian shopping cart has changed considerably since the upset of inflation. Especially private brands are on the elevator with the consumer. Earlier it turned out that more than 7 in 10 Belgians more often choose private brands to keep the shopping budget under control. Belgian is "Shop Hopper" A new Ivox study commissioned by Aldi shows that Belgian consumers also ignore other shop habits to save. For example, more than 3 out of 5 Belgians sometimes indicate that they are waiting longer to purchase products in function of promotions that are coming. In addition, we compare prices between supermarkets. The result is that the Belgian has grown into a real "shop Hopper". For example, half of the respondents indicate that they are increasingly combining different supermarkets since the price increases. This to enjoy the lowest possible prices at that time. 1 in 4 has even changed completely from a fixed supermarket. Discount increasingly popular In the search for low prices, the Belgian comes over more often at Discounters Aldi and Lidl, the study shows. Almost 3 in 5 Belgians confirm this. They are mainly young adults (<= 34j) who choose Discount (<= 34j: 64%; 35-54j: 56%; 55+: 49%). Even consumers who could not be found at discounters at all (around 10%) now go for the ax. The main arguments that motivate the choice for Discount are: the good price-quality ratio (64%), save on the budget (45%), interesting promotions and offers (43%) and shopping close to home (42%). Aldi can confirm the results of the survey. "Since mid-February we have seen an increased interest in Aldi," says Natalie Duthoy, Managing Director Category Management at Aldi Belgium. “A smart choice given that consumers also want to do money in times of inflation. Our private brands offer the solution: considerably lower than A-brands, but without compromising the quality. We even meet promo hunters with weekly competitive promotions on fresh products that are used daily in the kitchen. Those who want to resolutely want to draw the price-quality map therefore ends up with Aldi. ” See here for more: https://www.aldi.be/nl/bedrijf/pers/inflatie-maakt-van-belg-shop-hopper.html

Discount Retail Chain Pepco Group (Warsaw stock exchange listed and Steinhoff International owned), operator of European discount retailer brands Pepco, Poundland and Dealz, said the demand for its products remains strong even against the backdrop of macro-economic uncertainty. The group, which listed on the Warsaw stock market last year, forecast underlying core earnings (EBITDA) on a constant currency basis, for full year ended September 30, to come in the range of €735 million (US$ 726m) to €750 million (US$ 741m), in line with its growth expectations. “We will continue to drive our business using our four key strategic levers, bigger, better, simpler and cheaper," commented Trevor Masters, Pepco Group CEO. "This strategy is driving faster growth through accelerated store openings and innovation to improve each store for customers and colleagues, helping to further enhance our LFL performance." Group Revenue It said group revenue rose 17.4% on a constant currency basis to €4.82 billion (US$ 4.76bn), partly driven by 516 new stores. Like-for-like sales rose 5.2% and were up 15.5% in September, providing a strong exit rate into the new financial year. Central And Eastern Europe Pepco said in its core markets of Poland, Hungary and Romania inflation in clothing and footwear was running at only around a third of the headline inflation rate. Both clothing and food remain resilient categories in the Polish and wider Central and Eastern Europe retail sector, the company said, adding that the outlook across the UK remains 'challenging' as constraints on consumers' disposable income persist. 'That said, our value-led proposition becomes even more relevant in these challenging times and continues to drive new customers to our stores, expanding our target market, across Europe,' it added. The group has made efforts to lower its cost structure, as well as improve back-office structure and processes, a strategic focus that has "served us well in growing sales and delivering on EBITDA and cash generation," Masters added. "We are accelerating our strategy in order to capitalise on the opportunities available to us in these volatile market conditions." See here for more: https://www.esmmagazine.com/amp/retail/dealz-owner-pepco-sees-strong-demand-despite-economic-uncertainty-223208

Discount Retail Chain Aldi USA (Germany family owned) fans love it for its tiny prices. So as part of its new brand campaign, the grocer is deploying miniature interactive billboards, emphasizing its low prices in high-traffic areas in Atlanta, Dallas and Minneapolis. The idea fits neatly within its mission of saving shoppers money, with a serving of sass on the side. The campaign invites shoppers to hunt for the billboards, then scan the QR code for the chance to win free groceries for a year. "Aldi tries to break the system for its customers whenever it can that's why people love it so much," says Bob Winter, executive creative director at Leo Burnett, which created the campaign. "We're trying to zig when everybody else is zagging in a way that's both quirky and charming." The tiny billboards are precisely the opposite of what people might expect, he tells Marketing Daily. "That’s what makes it perfect for Aldi. It fits well with the brand's purpose." The campaign is actually pretty big, with ten new billboards erected in each city each day of the campaign. And the grocer is supporting the OOH effort with social media support. Aldi is a limited assortment grocer, based in Batavia, Illinois, with 2,200 stores in the U.S. (The parent company is based in Germany.) It's got a reputation for low prices, consistently coming in No. 1 for affordability in key industry rankings. But even more so, it's got a reputation for a bit of zaniness. Weird items making their way into its seasonal center aisles, for example, have a life of their own on social media. And fans are so devoted they occasionally propose to one another while shopping. "Aldi's fans are passionate. They're rabid,” Winter says. “And our job is to get more people to understand why, because once they do, they're Aldi's friends for life." He says the grocer has another small surprise up its sleeve, with a team of animated holiday gnomes standing by for a new holiday campaign. That campaign will come to life via TV spots, social and radio. "When people ask, 'How is it possible for Aldi to have all these amazing holiday products?' we decided gnomes are the obvious answer," he says. The small creatures will make things happen behind the scenes "in delightfully unexpected ways." Leo Burnett is also the agency behind the Keebler elves, introduced 50 years ago. The Aldi gnomes are different, Winter says. "They get a lot more done. Keebler's elves are amazing, but these Aldi gnomes are blue-collar guys. They're making things happen." See here for more: https://www.mediapost.com/publications/article/378833/aldi-debuts-teeny-tiny-billboards.html?edition=127946

Discount Retail Chain Motatos (or Matsmart, as it’s known on home turf) is one such business and is today announcing a €38m Series D, bringing its total funding to €130m. What does Motatos do? Motatos launched its online grocery store in Sweden in 2014 and has since expanded to Finland, Denmark, Germany and most recently to the UK. Instead of focusing on fast deliveries and fresh food, Motatos sells long-life household goods such as store cupboard ingredients, beverages, toiletries and pet food from the surplus inventory of large producers at a reduced price. Motatos says this means it not only offer consumers a bargain but also fights the problem food waste. By selling surplus food, it limits the amount that ends up in landfill. And it’s going pretty well for Motatos. The startup’s total revenue in 2021 was €68m (US$ 66.6m) and is on track to hit €100m (US$ 98m) this year. It’s even shown profitability in Sweden, at least in some months. Who are the investors? Motatos is backed by a number of Swedish and European investors: Its largest investor is the private equity arm of Swedish bank SEB, which led this round, along with UK-based VC Exor Capital. Other investors include European VC Northzone, Swedish VCs Edastra, Gullspång Re:food Invest, impact investor Norrsken VC, German LeadX Capital and London-based Blume Equity. However, when it comes to this funding round, the most interesting thing is not the investors that invested but the ones that didn’t get to. With the recent hype in impact tech as well as rising food prices and inflation, a new investor reached out to Motatos earlier this year with an offer. With a bid on the table, Motatos decided to get its skates on for its next raise. Its existing investors decided to match the terms of the deal on the table, says founder and co-CEO Karl Andersson. “It was a somewhat strange situation, but we decided to go with our existing investors’ counterbid, since that meant it would be a much quicker process.” As a result, Motatos’s valuation increased by almost 30% from that of its previous funding round, in November 2021, pushing it well over the €300m (US$ 294m) mark. Sifted’s take Many online food delivery services saw a spike in growth during Covid, but customers are now more conscious of the cost of living. With a looming recession, people will be cutting back on subscriptions and other unnecessary expenses and many ecommerce companies as well as physical retailers will likely see sales stagnate. But just as with Covid, where there are losers, there are also winners. Companies that offer services that help people spend less on food, electricity bills and other expenses, like car ownership, will have an opportunity to grow. For Motatos, the interest shown by investors is a sign the company is on the right track, while its proven ability to turn a profit (even if not annually, yet) puts it in a good position to raise again in the future. See here for more: https://sifted.eu/articles/discounted-groceries-startup-motatos-raises-e38m-series-c/

Discount Retail Chain Basalt (owned by the Danish Salling Group) opened its first 10 stores, which has low energy costs and promises cheaper groceries. Salling Group opened last Tuesday morning the first of a total of ten stores in the Group's new discount chain Basalt. It is the store on Amager Landevej in Kastrup that has opened the doors. On Wednesday, store number two and three will follow in Viby at Aarhus and the Trial Testament Center in Helsingør respectively. The stores are characterized by the fact that only the most basic groceries are on the shelves. Minimizes energy costs That is, items such as pasta, oatmeal, toilet paper, diapers, toothpaste, flour and bread and a selection of fruits and vegetables. The milk is of the long-lasting kind that does not require cooling. It minimizes the cost of energy, which according to Salling Group CEO Per Bank means lower prices for consumers. 'We have made every effort to create a concept that can help the Danes make everyday life better together at a time when the private economy is under pressure. With the lowest prices on the most basic groceries, we have at least made our bid for a concrete weapon against inflation', says Per Bank in a press release. Record high inflation The prices of groceries, like much else, have risen dramatically. Consumer prices, also known as inflation, were 10 percent higher than a year before. This is the highest annual increase in consumer prices since 1982 according to Statistics Denmark. As inflation increases, consumers get less for the same money. Per Bank has previously stated to the newspaper Denmark that the Basalt chain will be established on a trial basis. According to the director, how many stores are established depends on how well the concept is received. You are also ready to turn the key again, if it turns out not to be a success, he has said. The same tones sound on Tuesday morning from the top manager after the opening of the store in Kastrup. 'Customers decide how many stores and how far the concept goes. Important to have the courage to dare to try something new regardless of success or not', Per Bank writes on Twitter. Salling Group already operates the discount chains Netto, Bilka and Føtex. See here for more: https://nyheder.tv2.dk/samfund/2022-10-11-ny-discountkaede-abner-ti-steder-i-danmark

Dutch consumers are shopping more often at Aldi and Lidl. The market shares of these discounters are now larger than they were in years, according to figures from market researcher IRI. Private label brands are also a lot more popular now that the groceries are becoming more and more expensive. "Now that people really feel inflation in the wallet, we see that they do shopping more often at Aldi and Lidl," says Sjanny van Beekveld of IRI. Earlier this year the two discounters already won market share. IRI called that when the recovery of lost terrain. According to IRI figures, the two supermarkets are now on a joint market share of 16.3 percent. That is the second largest market share since 2010. Only in 2018 did it peak a fraction above it with 16.4 percent. Since then that it fell, until this year. "We think that the extra growth now is caused by the increased prices." Because prices are increasing, Van Beekveld also expects that the 'cheap supermarkets' will start even more market share of traditional supermarkets. "They do a lot of campaign to show that they also have low prices articles." Incidentally, the question is whether discounters are really so cheaper. "At least they have that image," says IRI. Furthermore, it appears that we buy private brand products much more often in the 'traditional service supermarkets'. That share is also the highest in years with just over 27 percent. See here for more: https://www.nu.nl/economie/6227646/aldi-lidl-en-huismerken-in-jaren-niet-zo-populair-als-nu.html

Alibaba-owned supermarket chain Freshippo, which is called “Hema” in Chinese and widely referred to as Hema or Hema Fresh in English, is known for its delivery-centric business model. Every store offers delivery, usually in less than 30 minutes, to customers living within a few kilometers. Driven by substantial investment from its parent company, Freshippo has grown into one of China’s largest supermarket chains since it was founded in 2015. The company now has over 300 stores in dozens of cities across China. But Freshippo is also widely thought to be a lossmaking operation, with only certain high-volume locations turning profits, which are offset in the aggregate by losses from the majority of stores. According to Reuters, the recent drop in valuation was driven by the impact of COVID-19 in China and particularly by the months long lockdown in the economic hub of Shanghai this spring. Shanghai is Freshippo’s largest market. Freshippo is seeking to raise US$400 million to $500 million from outside investors, according to the unnamed sources. Other sources stressed that the fundraising was not finalized and the terms were subject to change, while another indicated that the company had adequate cash flow and was not under immediate pressure to raise new capital. In January, Freshippo CEO Hou Yi sent an internal email laying out a strategy for moving from single-store profitability to comprehensive profitability. Then, in May, the company announced a round of layoffs mainly aimed at trimming regional purchasing and operations staff. Freshippo has also continued to close outlets of its Freshippo NB (Neighborhood convenience store) small-format, self-checkout concept. At the same time, the company has pushed forward with other new concepts, such as its discount-retail focused 'Freshippo Outlet brand', of which 40 stores have already been opened around China. According to industry analysts, Freshippo’s most profitable brand is its Freshippo X membership stores. However, the growth of this business model has not been as fast as anticipated. See here for more: https://www.producereport.com/article/covid-19-headwinds-lead-freshippo-cut-valuation

Discount Retail Chain Aldi Nord Poland's (German family owned) operational costs still exceed the revenues of the discounter, but this is to change. When and thanks to what actions? Wojciech Łubieński, President of the Management Board of Aldi, answers this question In 2021, the increase in turnover in the ALDI chain of stores increased by 20%, but at the same time the increase in advertising expenditure was 65%, employment costs turned out to be PLN 40 million (US$ 8.3 mio) higher, the commercial tax paid reached PLN 16.7 million (US$ 3.5 mio), and investments in the store network development are up to PLN 560 million (US$ 116 mio). This is Aldi in 2021 in numbers. Investments in development mean that operating costs still exceed sales revenues, but Aldi assumes achieving a positive financial result. 'Behind us is another year full of challenges for the retail industry. We are aware of the enormity of work, which is still ahead of us and strong competition. We will continue the chosen strategy of intensive development, which at the same time assumes achieving a positive financial result in the perspective of three years' announces Wojciech Łubieński, president of the board of Aldi. In 2021, 39 new ALDI stores were opened, which ensured the presence of the brand in each province. Currently, Aldi has 221 branches in Poland, while in two years their number is to increase by 50%. 'We are focused on organic development chosen so far, at the same time we are ready for possible acquisitions when the appropriate possibility appears. We will also continue to build the ALDI brand position on the market, continuing marketing activities. Work on new technologies aimed at strengthening competitiveness and cost optimization will be further intensified. The opening of the second distribution center near Bydgoszcz has recently been a very important event for ALDI, at this point we are already planning further distribution centers,' adds Wojciech Łubieński. Aldi is part of a group of ALDI NORD, one of the leading international retailers. The company employs over 77,000 employees in Belgium, Denmark, France, Germany, Luxembourg, the Netherlands, Poland, Portugal and Spain. See here for more: https://handelextra.pl/artykuly/260427,wojciech-lubienski-aldi-w-gre-wchodza-przejecia

Grocery prices climbed 13.5% in August from the year before, the highest annual increase since March 1979, according to government data. Executives at large food manufacturers and analysts expect inflation to hover around this level for the rest of 2022. Next year, the rate of food inflation is expected to moderate, but that doesn’t mean prices are going to drop. Once prices hit a certain level, they tend to stay there or go up, but rarely down. A number of factors have contributed to the surge in prices. Producers say they’re paying higher prices for labor and packaging materials. Extreme weather, like drought or flooding, and disease, like the deadly avian flu, have been hurting crops and killing egg-laying hens, squeezing supplies. Hurricane Ian could push food prices even higher Even if some of these situations stabilize, it will take a while for those changes to reach consumers. “There’s a lot of uncertainty,” said David Ortega, food economist and associate professor at Michigan State University. It’s not clear when the war in Ukraine will end, or how weather will impact crops in the future. “That’s one of the reasons why prices take longer to come down.” Producers aren’t “seeing any end to inflation in terms of their labor and commodities cost,” said KK Davey, the president of client engagement at market research company IRI. The firm expects food inflation to rise between 5% and 10% next year. Meanwhile, demand is high. Consumers may be able to pull back on some discretionary items, but they have to eat. And paying higher grocery prices may still be cheaper than dining out at restaurants, where menu prices are also rising (though at a slower clip). And many people are still working from home and consuming more of their meals there. This imbalance means companies can pass along higher prices to shoppers without sales plunging. “The cycle will break when supply is high and demand moderates,” said Davey. Companies continue to raise prices “We do expect the near-term inflation to remain high,” Mondelez (MDLZ) CEO Dirk Van de Put said on an earnings call this summer. The maker of Oreo and Ritz said that its energy, transportation, packaging and raw materials costs remain elevated, and it announced further price increases to offset those increases. General Mills (GIS), which makes everything from Cheerios to Blue Buffalo pet food, expects that its costs will increase by 14% to 15% for its 2023 fiscal year, led by a rise in prices of ingredients such as nuts, fruits and flavors. The company is planning additional price hikes for its retail customers. For now, consumers haven’t balked at the higher prices, noted CEO Jeff Harmening during a September earnings call. “So far, we haven’t seen really any change in elasticities, which for us was a positive in the quarter,” he said. Elasticity refers to how easily customers change their shopping behavior in response to higher prices. Consumers accepted the higher prices more than General Mills would have expected, Harmening noted. Between costs continuing to rise and people continuing to buy, there’s little reason for companies to discount their products. “We think the risk of promotions ramping up significantly over the next couple of quarters is quite low,” Harmening said during the call. For manufacturers to increase promotions, supply chain disruptions would have to end and costs would have to fall significantly, he said. “We don’t see any of those things.” Why grocery prices are so sticky In general, prices tend to go up over time. Government data shows that from 1974 to 2021, grocery prices dropped only during two years. Every other year, they went up, though some years the increase was very slight. “There’s always a general increase in prices overall,” said Ortega, the food economist. “That’s just the nature of the economy.” Typically, however, grocery prices go up about 2% or 3% a year, he said far slower a pace than the increase happening now. In the past, consumers may not have noticed higher prices because their wages kept pace with the increases. Right now, that’s not the case. “Consumer prices are increasing faster than wages are increasing,” he said. “What we’re seeing now is really a cost of living crisis.” Grocery prices in particular are sticky also because of how much of a hassle it is to change them. Food prices are soaring, and that's changed how we eat When food manufacturers raise prices for retailers, those retailers don’t necessarily pass prices along to consumers. Some may opt to keep prices low,if they can afford it,to attract customers into the store. Retailers also don’t like to raise prices little by little because it frustrates consumers, said Andy Harig, vice president of tax, trade, sustainability and policy development at FMI, a food industry association. “A lot of people shop every week … and there’s lots of consistency in what they buy,” he said. So when prices change, even slightly, “they really notice that, and feel those changes.” When retailers do switch prices in stores, they have to print out new labels and enter the new values into their sales systems. Stores carry tens of thousands of different items, so when prices go up across different categories, making adjustments becomes a ton of work. That means that “when you do see increases happen, they tend to stay in place,” Harig said. See here for more: https://edition.cnn.com/2022/09/30/business-food/grocery-store-prices-food/index.html

Discount Retail Chain Lidl UK (owned by the German Schwarz Group) commits to selling 100% free range eggs by the end of 2024, reinforcing its commitment to the welfare and conditions in which hens are housed. This new commitment, the first from a Discounter in Great Britain, builds on the supermarket’s existing pledge to work with suppliers to phase out the sale of eggs from caged hens in stores by 2025. It also means that, by the end of 2024, all of Lidl GB’s fresh shell eggs will be RSPCA Assured. Martin Kottbauer, chief purchasing officer, Lidl GB said: “We know that, in addition to the taste, the welfare and conditions in which hens are housed is important to our customers.” As part of its commitment to championing British produce, 100% of Lidl GB’s fresh shell eggs are sourced from British suppliers and are produced under the British Lion Mark. As the supermarket transitions to selling only free-range eggs it is working closely with its egg suppliers and has introduced longer-term contracts to help ensure that they have security and certainty needed to invest for the future. Kottbauer continued: “Our commitment to selling 100% free range eggs by the end of 2024 builds on our strong credentials as a grocer which sources sustainably and responsibly, offering the highest quality produce at affordable prices. Whilst our overall market share is currently 7.1%, we know that 12% of all fresh shell eggs are bought through Lidl, and we therefore hope that this commitment will help create positive change across the industry.” See here for more: https://www.theretailbulletin.com/food-and-drink/lidl-to-only-sell-100-rspca-assured-free-range-eggs-by-2024-03-10-2022/