Discount Variety Retail Chain Action (owned by 3igroup) officially opened its 200th Action store in Poland. The discount retail Action chain not only invests in the development of the chain of stores, but also in pro-ecological solutions. The company wants to halve CO2 emissions by 2030 compared to 2020. By 2024, none of the Action stores will use gas heating. Action is a non-food discount providing an offer of around 6,000 items in over 2,000 stores. More than 11 million people visit them every day. The chain is present in 10 European countries. The Action Group, of which the Polish company is a part, is recording a dynamic increase in sales on the European market. In the first quarter of this year, the company recorded consolidated net sales of EUR 1.8 billion (US$ 1.91billion), which is a 42 percent better result. since last year. The increase in sales according to comparable data (LFL) was 27.7%, reflecting the lower impact of the pandemic compared to the same period last year. See here for more: https://www.wiadomoscihandlowe.pl/artykul/siec-dyskontow-action-otworzy-swoj-200-sklep-w-polsce-wiemy-gdzie-i-kiedy

There is no doubt that the Discount format has become a successful model in much of the countries where it operates. Thus, if we analyzed the data in Spain, (1) Lidl became 2021 third in market share, passing in a single year of 5.9% to 6.7%, and Aldi was the chain that won the most buyers the year past. In other markets near Spain and discounters are famous for their competitiveness, the situation is similar. In the French market (2) Lidl and Aldi were the chains that most saw their share last year. In the case of Lidl reaching 7.1% and growing 0.4% compared to 2021 and by Aldi rising 0.3% compared to the previous year to reach 2.8% market share. In the case of the United Kingdom (3) Aldi is already the fifth leader of the market with 7.8% market share, winning 0.4% compared to the rest of British chains. For its part, Lidl evolves in the last year from 5.9%to 6.2%, with a rise of 0.3%. This evolution of growth and consolidation of the Discount model is not punctual with respect to the year 2021 but has been consistent in recent years in most countries where the format operates. In addition, according to the IGD Research Institute, this trend will continue to accentuate. IGD (4) provides that the participation of the Discount format in the EU will grow from 23% in 2018 to 26% in 2023, being the format that increases its market share. Only the online format also grows its participation in this period. The rest of the channels (hyper, super and agreed) remain stable or decrease. Discount supermarket What has been the strategy that has implemented the Discount that is giving so good? The main Discount operators understood years ago, if they wanted to grow consistently in the future, they needed to attract new customer segments, not only those focused on low prices but all others. They also needed to change the customer's perception that in their stores you could only buy opportunities or the classics commodities, and that their establishments became 'One Stop Shopping' stores where the customer could make their full purchase if you wanted. Therefore, this evolution has in a certain way a certain "supermarket" of Discount, but which has been carried out in a very intelligent way because certain layers of value of the supermarket have been added to the discount stores, without losing any of their strengths. As price competitiveness, the simplicity of the assortment and functionality of its stores. That is why I like to call this evolution of the discount model the Smart Discount, because this evolution has been intelligent, skilled and elegant, all meanings of the word smart in English. Smart Discount: such as Aldi Corner Store in Australia What have been the concrete elements that have progressively incorporated into this new Smart Discount concept? In recent years there have been many changes, I will focus on the most relevant: Improvement of the quality of the assortment that has allowed a change in the perception of the consumer to the OEM private label brands. On the one hand, significantly raising the standards and requirements of the products in the assortment as a whole regardless of their category. On the other hand, throwing new ranges with differentiated positions such as the Premium range (eg, “Special” products of Aldi) or specific ranges in certain categories (eg “La Queseria” of Lidl) that have changed the perception of the customer towards the assortments of these retailers. Focus in the development of frescoes seeking to raise the frequency of visiting consumers. With a phenomenal impulse of the hot point incorporating a wide variety of breads and pastries, as well as an excellent merchandising at the point of sale. Continuous attention in the freshness and quality of fruit and vegetables, with frequent promotions in store seeking product rotation. Adding fresh meat and fish to offer 'One Stop Shopping'. Greater extension of assorted through the innovation of new products and incorporation of leading brands and regional products There has been a great evolution of the commercial offer, evolving from an assortment focused only on basics with few news to a very active innovation strategy with continuous launch of new products that respond to new units of need and provide a differential value to the consumer. Likewise, leading manufacturers and regional products have found an opportunity to introduce their products through 'In & Out special buy' actions, giving a commercial dynamism to the assortment and contributing novelty to the consumer. Strong investments in the renewal and opening of new points of sale. With an ambitious expansion of stores to reach new customers and be closer to them. Both Lidl and Aldi opened in 2021 around 40 stores each in Spain. This expansion policy has occurred in other countries such as the United Kingdom, France or Portugal and will intensify in the coming years. Bet on the comfort and experience of buying the customer with a new store concept. The discount teaching have gone from being famous for their Spartan establishments to having a network of wide, modern and functional stores that have radically changed the customer's purchase experience. Next steps of the Smart Discount: such as the Queeria Lidl, cheese section At this time, what are the following steps in the evolution of this concept Smart Discount? In addition to continuing to evolve at the aforementioned points, in the coming years the Smart Discount will invest intensely in the following axes to continue giving value to its consumers and differentiate itself from its competitors. Focus on the sustainability axis with a broad and transversal reach along the entire value chain. Incorporating animal welfare accreditations for products of animal origin and different certifications for much of the assortment, “UTZ” for coffee, “Fair Trade” for chocolate and so on in other categories. Reducing or eliminating plastics in the use of containers and packaging in products and in the auxiliary materials of the stores. In the opening and renovation of eco -efficient stores and stores that use renewable energies and work with efficient systems throughout the property. Commercial development focused on the axis of health and healthy products. Promoting a wide range of assortment of bio products at affordable prices. Both Lidl with "Bio Organic" and Aldi with "Gutbio" have been developing in recent years a bio assortment that already has about 200 products and will expand in the future. Expanding the range of vegan products and dedicating specific brands for said segment. This is the case of Lidl that has developed the Vermondo its own brand to go to the vegan and flexiterian segments. Incorporation of Nutri-Score labeling (nutritional traffic light) in its MDD assortment to commit to transparency and improvement of eating habits. Impulse of solutions, introducing a new purchase mission Responding to a whole series of social, culinary and consuming changes that are changing customer consumption habits. The Smart Discount teachers, with locations within the cities and the frequent visit of customers, will boost the offer of this type of solutions -for example, a variety of dishes and salads, fresh juices, coffee, cut fruit, etc. Examples such as the new “Aldi Corner Store” store in Australia or the new range of “Gastro Collection” products in Aldi UK are in this line. Bet on digitalization and online channel. Traditionally these types of teachers have been lagging with other competitors regarding digitalization and online. However, they are recently addressing new projects such as the following: Personalization of the relationship with the client with tools such as the LIDL loyalty app with personalized coupons and gamification dynamics to gain frequency, increase medium basket and gain faithfulness. Online shopping. It is the pending subject to address in the coming years. Lidl already operates online in different countries with the bazaar and textile, but the food still has pending. Aldi, on the contrary, is promoting some initiatives on the online food channel: Click & Collect in some stores in the USA and UK, and alliances with delivery platforms in others. Purchase with automatic payment. ALDI has been the first of the Smart Discount operators to take the first step opening in London last January the first store with Check-Out Free technology. In conclusion, we can see how the classic Discount model has progressively transforming into a new model that offers a more powerful and robust value proposal to attract all consumers. The Smart Discount adds multiple layers of value to the client, but without breaking the "core" of the Discount model, staying faithful to its formula of competitiveness, practicality and proximity. Without a doubt, this new model will be an excellent competitor in the coming years for the rest of the formats that will have to reinforce their strategies to win the client. ------------------ (1) Kantar Worldpanel Spain data. Accumulated consumption P9 2021 (2) Kantar Worldpanel France data. FEE Last 12 weeks February 2022 vs. February 2021 (3) Kantar Worldpanel UK data. FEE Last 12 weeks January 2022 vs January 2021 (4) Retail in 2025. Sources: (1) Datos Kantar Worldpanel España. Consumo acumulado P9 2021 (2) Datos Kantar Worldpanel Francia. Cuota últimas 12 semanas febrero 2022 vs febrero 2021 (3) Datos Kantar Worldpanel UK. Cuota últimas 12 semanas enero 2022 vs enero 2021 (4) Retail in 2025. IGD See here for more: https://www.foodretail.es/blogs/firma_invitada/hard-discount-smart-evolucion-formato_7_1672402744.html

It was March 2009 and in the traditional neighborhood of San Pío, in the municipality of Itagüí in the city of Medellín, the first hard discount store was born in Colombia. With a low profile and in an area where the population of the medium and low income predominates, according to the classification of the National Planning Department of that country, the D1 discount retail brand made its debut. “The discount format was not known in Colombia. At first people did not believe in it, nor the suppliers of conventional national brands. We had to go to small suppliers who started with D1 and today are very large and important as a result,” says Ignacio Gómez, consultant and retail expert and hard discount, who was an external consultant of D1 in his first years of operation. More than 13 years have passed since that opening and today D1 has been talking in the Colombian retail industry. D1 currently not only has just over 2,000 stores in 451 municipalities from 28 departments, but also this year it made news after becoming the main retailer, dethroning the historic leader Almacenes (owned by the Grupo Éxito) according to the Map of Retail 2022 made by Mall & Retail. Thus, while D1 the store chain of the Santo Domingo Group, one of the most powerful conglomerates of Colombia culminated 2021 an operational income of 9.91 billion Colombian pesos (US $ 2,650 million) and recorded a growth of 32% versus 2020, Éxito stores revenues were 8.58 billion pesos (US $ 2,290 million), registering a growth of 6.6%. And it is in the first months of the pandemic the e-commerce became a rising star and a temporary lifeguard for retail trade in times of confinement, today, back to the face-to-face, hard discount stores are now the stars in the retail industry for more than a year. This discount retail format, originated in Germany with important discount retail brands such as Aldi and Lidl, has been entering in Colombia, Latin American market where D1 is not alone in this segment, but competes with other discount retail brands such as Ara (from the Portuguese group Jerónimo Martins) and Justo & Bueno (from Panama). These stores are characterized by their low prices, a maximum of 700 sku portfolios and that are deployed in areas of between 200 and 300 square meters, and have been gaining ground in the middle of a post-pandemic economic crisis that has put diverse impact on the food retail markets, including Latin American, experiencing inflation, food shortage, loss of reduced jobs and reducing budgets for the basic grocery basket. “The increase in inflation and the consequent effect on the prices of basic consumption products have reaffirmed the role that discounts have in the Colombian grocery basket, supporting consumers with convenient prices and growing variety of products. The strong presence of own private label branded products in its stores means that companies can respond faster not only to changes in consumer preferences, but also to stock difficulties and breakdown of raw materials, increasing the production of products similar or launching new varieties leveraged in the ingredients of easier access,” says Paula Goñi, consultant at Euromonitor International. Indeed, their own private label brands have played an important role in the consolidation of the discount stores. However, the consistency in quality to gain the confidence of buyers has been key and also a gradual process. “Before the discount retail formats were not very successful because there was a distrust of the general public when thinking that if something was very cheap the quality was not necessarily good. Another point is that the penetration of neighborhood stores is very strong in Colombia, between 50% and 52%. However, before the Pandemia, three Hard Discount store formats began to be opened: Ara, Justo & Bueno and D1. People began to see them different, because quality was good and consistent. From there, consumers began to see it as an intelligent purchase, says Juan Pablo Soto Zuluaga, Vice Dean of Corporate Relations of the University of the Andes. For Luis Raúl Domínguez, professor of the International Marketing and Business Program at the Autonomous University of the West (UAO), the ascent of Hard Discount took place much earlier, specifically in 2016, the year that was a break point for this format. “In 2016, a truck drivers in Colombia blocked roads, entries and exits of large cities and collection centers. At the same time, the government took new measures to reduce the cultivation of the coca leaf and the cocaleros producers joined the strike that took a lot of strength, generating an atmosphere of instability. On the other hand, VAT rose three points and 2016 was also the year with the highest inflation, of 5.75%, in the last 16 years. All these factors made the products more expensive. This tested our pockets and boosted the growth of Hard Discounters in Colombia,” says Domínguez. Neighborhood stores in Jaque Another factor of the upward success of these stores is their proximity. According to the recent dynamic report of the Hard Discount in Colombia, prepared by the Bancolombia Group, this format has ventured in a disruptive way the retail sector, in some cases to the point of exceeding at the level of sales to traditional companies in the sector Supermarkets "Thanks to its expansion strategy, the main referents of this business model have managed to have high national coverage, with more than 3,700 stores operating today," says the report. Juan Pablo Espinosa, director of Economic, Sector and Market Research of Bancolombia, adds: “The great reception in Colombia is mainly due to the proximity of their stores to consumers, as well as a diversified offer of products, positioning their own private label brands as protagonists. In this way, people have the possibility of accessing essential goods with a quality/price ratio perceived by the consumer as highly competitive ”. On the other hand, despite the fact that neighborhood stores remain the main competitor of the hard discount, they are giving land year after year. “Something that has impacted rents is the strong increase in the square meter of the properties throughout Colombia and especially in popular neighborhoods, where the rental of the houses located in the corners is more expensive. The shopkeeper does not own this strategic point and renting becomes very expensive. To do this, he has to marginalize more strongly to hold his business, that is, raise his prices, ”says Luis Raúl Domínguez. According to Juan Pablo Soto, neighborhood stores have currently backed away in Market Share and hold a 48% participation, which is still high but that moves more away from their historical 50%. “The Hard Discount formats such as Ara, Justo Bueno and D1 began to be located in areas of less favored strata or lower economic income and has allowed them to take part of the market they did not have. In addition, the reality is that in neighborhood stores not necessarily the price is the best. It is always a little higher, but they offer closeness to people who cannot move far away and other things such as the fractionation of the products because they did not have to buy the great product, but per unit or less amount,” says Juan Pablo Soto. Colombia is leading the hard Discount in Latin America. According to Bancolombia, as of March 2022, the hard discount in Colombia has a 21% market share and it is projected that this year reaches 30%. In April 2021, one of the highest months of the pandemic for Colombia, the Hard Discount Share reached 38%, demonstrating the penetration potential of this format. Pure and hard discount in the rest of Latin America Either in a corner of a residential area, on a busy avenue, in a popular district or in an exclusive one, it is increasingly frequent to find Hard Discount stores also in Lima and Callao in Peru. According to the market study firm Lock & Asociados, there are more than 600 points of sale with the discount model in Peru, most in the capital, which represent 11% of sales for the modern channel. The brands that have started this path are Mass (from the Intercorp Peruvian group), Hyperbodega Price One (of the Chilean Holding Falabella) and Vega stores, from VEGA Corporation that has mainly focused on the North Lima area. Mass is the most ambitious discounter in the country. This year the chain plans to open 120 stores with an average sales area of ​​200 m2 per place. This plan goes in line with the openings made in 2021, the year in which they opened 130. At the end of 2021 they had 557 stores, according to the financial report of the fourth quarter of 2021 of Inretail, the Retail Division of Intercorp. “In Peru, the growth of Hard Discount is sustained, although it has a small participation. However, its growth rate is auspicious, since it resembles the traditional consumption patterns that still continue in Peru, as well as in the incessant search for the best prices by consumers. While it is risky to differentiate itself only by the price, this type of formats achieve more and more attention because consumers have become more rational due to economic limitations product of inflation, pandemic and the little availability of some products,” says José Ruidías Rojas, Professor of Pacific Business School. For the professor, the challenge to ensure the sustained and profitability growth of this type of formats is to achieve a great purchase experience of consumers, without generating cost overruns that end up eroding the main differential of value proposal, which in this case is the price. Although Peru is far from matching Colombia's current status in the field of discount stores, the format has already felt solid bases to begin its expansion in the interior of the country, not only in large cities, but also in intermediates, where In other Latin American markets they enjoy great acceptance. "It is possible that in the future Peru has the open space to reach the market level of Colombia," says Juan Pablo Soto. In addition to Peru, several countries in the region are added to the Hard Discount's trend, with advances and levels of maturation of different markets. “In Peru, Mass stores have been growing well, but in other countries this trend is also taking place. In Ecuador is Tuti that grows rapid in Guayaquil and is a clone of D1, because those who opened the company were D1 employees. In Argentina and Brazil DIA, which is a chain of Spanish origin that carries most stores,” says Ignacio Gómez. In that sense, the Ecuadorian chain Tuti, of the El Rosado Corporation, opened its first store in Guayaquil in April 2019. Today it already has more than 150 stores, venturing into the provinces of the coast and now also in the mountains of the Andean country. On the other hand, the DIA chain, which today is controlled by the industrial group based in Luxembourg Letterone, already has 900 stores strategically located in cities, neighborhoods and towns of Argentina. In Brazil, day has more than 600 stores. Precisely these two markets, DIA also operates in Spain and Portugal, were it registered the greatest increase in sales in the first quarter of 2022. The main rebound occurred in Argentina, with net sales of € 286.2 million (US $ 290,5 million), 45% more than the same period of 2021, while in Brazil the increase was 9.8% and sales amounted to € 197.4 million (US $ 200.4 million). Mexico, on the other hand, is a much more mature market than the South American and has thousands of discount stores. And the complex economic situation of recent months has served as great impulse for expansion. “The last quarter of 2021 was impacted by the price increase and it is better observed how these channels accelerated, especially in countries with the less favorable economic scenario such as Argentina, Brazil, Central America and Mexico. Precisely in this country you can see a clear sign of how the discount formats bet on the transformation. Bodega Aurrerá (owned by Walmart), for example, not only will invest this year in expansion through new points of sale, but also to technological and logistics improvements, but the most interesting thing is that the highest percentage of investment. This chain will invest in remodeling the points of sale, without a doubt, to go more in line with the needs of New Latin Shopper,” says Lenita Vargas, Shopper & Retail Director Latin America Kantar. Indeed, in March 2022, during the Walmex Day corporate event, the Walmart retailer of Mexico and Central America (Walmex) announced an investment of 27.6 billion pesos (just over US $ 13,440 million), a growth of 34.9% with respect to At 2021. The retailer explained that 40% of the capital will be used for remodeling, 28% to the expansion of new branches, 17% to logistics and the remaining 15% to technology. In physical stores its main commitment will continue to be Bodega Aurrerá, which in Mexico represents 80% of the total stores and at the end of 2021 it had 2,756 stores. On the other hand, Tiendas 3B of the Lebanse businessman, Anthony Hatoum, has deployed more than 1,300 points of sale and, after the pandemic, has done some tests with the e-commerce through the Marketplace Mercado Libre. Net stores is another hard discount chain. Hugo Salinas Sada, son of the owner of Elektra, Ricardo Salinas Pliego, is the founder and president of the company that last week he turned 13 and currently adds more than 1,500 stores. Large backs for small formats Although the supply of the hard discount format has multiplied and these are small, basic stores and with a limited stock of products, their expansion and their profitability demand millions of investments to generate economies of scale. “These are formats that require a high financial muscle to start because they are very high expansion formats. For example, D1, which began in 2009, began to be profitable in 2018. All that time was investment and investment. Now they are in the time of recovering and growing. On the other hand, they are not small investments or capitals, with US $ 1 million, everything will be done. We are talking about US $ 70 million or US $ 100 million that can be considered as a risk capital that can go well,” says Ignacio Gómez. "This is a format where you have economies of scale you have to make a "oil spot" growth in which you cover areas because you can make the fastest distribution in small areas. If you have the stores very decentralized or scattered, it is very expensive. This is a format that is very dependent on costs and all the operational efficiency transfers to the price to the consumer, that is the gain here,” complements Juan Pablo Soto, of the University of Los Andes. But not everyone gets good about the play. This is the case of Justo & Bueno, one of the main discount retailers of Colombia that today is going through a delicate financial situation. The accelerated expansion was not at the same rate as its income which led it to a debt of 135,000 million pesos (more than US $ 30 million). As a consequence of this, Justo & Bueno received a liquidation order last May from the Superintendence of Societies, which is in force. Since then, they have paraded potential investors from various nationalities to rescue the discounter, although no proposal has progressed so far. “Just & Bueno is the second discount retailer in number of stores, it has 1,350. What happened? As I did not have the capital to make that expansion, it began to be leveraged in suppliers, delayed payments and has generated that debt that can no longer handle well. More than format, it is a company management problem. They have grown a lot, but they were less successful as budgeted,” says Ignacio Gómez. The most recent novelty about Justo & Bueno is that Lobbing & Consulting, an investor interested in rescuing and sell as the best option to advance recovery. Thus, despite the great impact that Justo & Bueno's financial crisis has had, the interest of investors to refloat the company, given that the hard discount formula works in the Colombian market, remains intact. For Paula Goñi, in the rest of Latin America the development of this format will not be uniform. “The expansion of the format at Colombia is something that we only see in Mexico, where discounters have also had a rapid opening of premises. However, in the rest of Latin America this strong development has not been appreciated, since the phenomenon depends mainly on the opening thrust of premises and the destruction of the traditional channel, something that supermarkets and hypermarkets have carried out much more efficiently in other countries of the countries of the region,” he says. However, the specialist does highlight the potential of Latin America. “The region remains positioned as a fertile terrain for discount format growth, since consumers' income and economic growth prospects will continue to be reduced during the coming years as a result of the economic attacks of pandemic and the consequent world economic rearrangement. Old consumer habit refrain, finding good products at good prices will be increasingly willing to explore the benefits of the discount format and complement their purchases if the products are not available on promotions,” says Goñi. See here for more: https://www.americaeconomia.com/retail-tiendas-descuento-latinoamerica

Discount Retail Chain Lidl (owned by the German Schwarz Group) e-filling network continues to grow: by 2025, every second branch with a parking lot will get its own charging station. "So that we can reach our climate goals, rapid and effective measures are also necessary for traffic. The expansion of electromobility is an important step and a valuable contribution to environmental protection. We assume that the e-mobility also proves itself in our company And we can rely on it in the future, ”said Alessandro Wolf, chairman of the management at Lidl Austria. The new electric vehicles have a range of up to 500 kilometers. The company's own shop network is only supplied with green electricity from Austria-part of it comes from in-house photovoltaic systems on the roofs of the Lidl branches and logistics centers. Last Saturday the new VW-E vehicles were handed over to Porsche Austria in the Mooncity Salzburg. Thomas Herndl, trademark manager at Volkswagen Pkkar added: "We are very pleased at Volkswagen that Lidl Austria is now using our new fully electric id. Models as a company car for its employees. As an automotive partner, we see the use of air conditioning and sustainable vehicles as the right step In the future. That is why we also support the new Volkswagen ID. Drivers from Lidl with a detailed handover of the vehicle and already wish many safe kilometers and even more driving fun on the way together to climate-neutral mobility. ” Alternatively driven truck in the test As part of the Lidl climate offensive, the domestic food dealer also tests alternatively powered trucks for branch delivery in the Vienna area. The tests are the start of a long -term fleet change that Lidl Austria has made. The declared goal: By 2030, the branches are to be supplied with 100% alternatively powered vehicles. Lidl Austria's e-petrol net network is also growing: almost 60 stores are already equipped with charging stations. This year alone, Lidl Austria is investing almost one million euros (US$1.01 million) in the charging infrastructure. By 2025, at least every second store with a parking lot will receive an e-petrol station. Lidl Austria defined ambitious goals far beyond e-mobility in terms of climate protection in order to make a contribution to limiting the ear heating to 1.5 degrees Celsius. In 2021, its own climate strategy was published in cooperation with the WWF Climate Group. The action plan is complex and includes all corporate areas: from the targeted use of photovoltaic systems for branches and logistics centers to responsible use of plastic packaging and climate-damaging food waste. In the past financial year alone, over 60 new photovoltaic areas were created. By 2023, every branch in which it is possible will receive a sustainable photovoltaic system. Lidl Austria is already operating over 30,000 m² PV areas. See here for more: https://firmenwagen.co.at/news/discounter-lidl-investiert-in-e-flotte/

Discount Retail Chain Lidl Italia (owned by the German Schwarz Group) has reported a 2021 turnover of €5.9 billion (US$6 bn), up +6.9% compared to the previous year, and has announced plans to invest €1.5 billion (US$1.53 bn) by 2024 to open 150 new stores. Currently, the retailer’s network consists of 700 stores in Italy, and the discounter is seeking to reach 1,000 stores by 2030. Part of the investment will be used to expand the retailer’s logistics network, with the construction of new storage facilities in Lombardy and Sicily, in addition to one already under construction in Sardinia. The announced investments will result in the creation of more than 6,000 new jobs by 2024, the retailer said. ITALIAN FOOD EXPORTS Last year, the company’s Italian suppliers exported €2 billion (US$ 2.04 Bn) in products to other Lidl markets, of which fruit and vegetables accounted for more than €550 million (US$560 mn). In fact, Lidl alone accounts for 10% of the total export value of Italian fruit and vegetables. SUSTAINABILITY INITIATIVES According to CEO Massimiliano Silvestri, Lidl Italia is also highly focused on sustainability, significantly reducing the use of plastic for private label packaging, using only energy from renewable sources, and installing photovoltaic panels on 40% of its stores, which supply 50% of its energy needs. The group is also committed to reducing emissions by -48% by 2030 ,and has a fleet of trucks consisting of 40% biomethane or liquid gas powered vehicles and two electric vehicles. It plans to continue expanding its fleet of green trucks (to date 30% of the vehicles are powered by sustainable fuels) as well as reduce the carbon footprint in its stores and logistics facilities. It also plans to continue its commitment to reducing waste through its collaboration with Banco Alimentare, which in four years of activity has resulted in the collection of more than 26,000 tons of goods, equal to around 52 million meals. Lidl Italia has also presented a study according to which it generated an overall impact on Italian GDP of about €3.5 billion (US$ 3.56Bn) in 2020. See here for more: https://news.italianfood.net/2022/07/07/lidl-italia-to-open-150-new-stores-by-2024/?utm_source=newsletter

Canada Pension Plan Investment Board (CPP Investments) announced that it has invested US$334 million, for a 19.3% stake, in D1, the market leader in Latin America’s expanding “hard discount” food retail space, which focuses on offering selections of private-label products at affordable prices. “Hard discounters” differ from traditional supermarkets by prioritizing convenience and low prices over size and assortment. This business model has proven highly successful in Colombia, where D1 has opened over 2,000 stores since its founding in 2009. The transaction marks CPP Investments first direct private equity investment in Colombia, a market that is predicted by the OECD to grow by 6.1% in 2022 more than double the global growth forecast. “D1 provides an excellent opportunity to capitalize on the behavioral shift occurring in Latin America’s food retail space, where consumers are adopting new ways of shopping that prioritize convenience and price,” said Tania Chocolat, Head of Active Equities Latin America and São Paulo Office Head at CPP Investments. D1 disrupted the food retail industry in Colombia, where it is leading a boom in the hard discount model. It is steadily opening more stores and introducing new products, which are known throughout Colombia for their high quality and low prices. “Latin America is a region where several industries are undergoing rapid transformation and Colombia is among the markets we’ve identified as particularly fertile for growth,” added Chocolat. “Our investment in D1 supports our goal of identifying standout companies in the region that are well-positioned to deliver strong long-term, risk-adjusted returns for the CPP Fund.” About CPP Investments Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the Fund in the best interest of the 21 million contributors and beneficiaries of the Canada Pension Plan. In order to build diversified portfolios of assets, investments are made around the world in public equities, private equities, real estate, infrastructure and fixed income. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, San Francisco, São Paulo and Sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At March 31 2022, the Fund totalled C$539 billion. See here for more: https://www.cppinvestments.com/public-media/headlines/2022/cpp-investments-invests-us334-million-in-colombian-food-retailer-d1

Discount Retail Chain Penny Hungary (owned by the German REWE Group) faces big challenges with increases in food price and special tax, but the chain is still in the middle of a large-scale rebranding process in these years. The renewal of stores, the product assortment update and the automation are also a sign that the company is planning for the long term in Hungary, said Florian Jens Naegele, CEO of Penny Hungary and Financial Officer Silke Janz. Florian Jens Naegele is CEO of Penny Hungary and Silke Janz Director at Penny Hungary reacted upon some questions, what results could Penny produce in the first half of this year and what does this mean in the current business environment? Despite last year's continuing difficulties, Penny Magyarország Kft. Exposed a full annual turnover compared to the same period of 2020. In numbers, this represents gross HUF 389.5 billion (US$ 1.0bn), an increase of exactly 4.45 percent compared to the gross revenue of HUF 372.9 billion (US$ 0.96bn) in 2020. In addition to the challenges of recent years, covid pandemia and the subsequent economic recession, we seem to be ahead of difficult times again, but we trust the Penny team of nearly five thousand employees in Hungary. The current economic situation, steadily rising energy prices, inflation, and the war conditions at our neighbor, is also putting pressure on customers' wallets. Therefore, discount retail chains are an increasingly favorable choice for them, so we also need to respond to the continuously changing consumer needs as quickly as possible. How does the Food Price affect the operation of the company and negotiations with the suppliers? Recent government measures have put the entire retail sector in a challenging position, from producers to suppliers to shops to larger store chains. This situation also requires huge resources from us. For our partners, the most important goal for us is to create conditions with our suppliers that have as many benefits as possible for both parties and even customers. Of course, it should not be forgotten for consumers to evaluate the situation. Although they have now been explicitly delighted (price caps for flour, oil, sugar, chicken, pork and UHT milk), it is important to emphasize that Apart from customers, almost everyone is struggling to survive in the industry, as farmers, shippers and retail companies are now making significant losses due to a significant increase in raw material prices. We are working for Penny to get as many products as possible from domestic suppliers as possible. When this is not possible at some point, for example, for the supply chain problems, it is particularly beneficial that we have an international background, as this allows us to provide a wide and reliable supply. In addition, this is exactly what we can remain competitive on the market. Currently, nearly two-thirds of commodities are provided by domestic producers and we are constantly working to make this proportion even higher in the future. How to evaluate the recently announced measure for a special tax tax? How does this affect the commercial sector and within it? Considering the transformation of customer needs, Penny was about repositioning in 2021, our 227 stores in the country are constantly renewed and our supply of goods is expanding significantly. We spend a huge amount on the company's operation, and we are constantly reversing our profits. The essence of the operation of discount chains lies in the low margin, which is why the introduction of the planned extra profit tax is a big challenge for us. This will make it harder to realize our plans we want to implement in Hungary in the near future. Penny is experiencing a rebranding process in Hungary. What are the reasons for this step and how much does the shop renewal cost? The renewal of our shops began in 2021, when we spent a total of EUR 35 million (US$35.8 mio) for this purpose. Our costs have increased to EUR 52 million (US$ 53.23 mio) in 2022, and in 2023 we are planning to spend an additional EUR 35 million (US$ 35.8 mio) on modernizing our domestic stores. These numbers also prove that we have long-term plans in Hungary. We are constantly increasing our domestic market role, further strengthening and renewing the brand. These are all processes to respond to customer needs and changing consumer trends. When mapping customer needs, we have observed that there is a growing demand for new and more modern shops and that healthy diet is becoming more and more important among our customers. Our latter experience reinforces our lifestyle supply, for example, and more and more of our shops are gluten, lactose-free, candy control, bio- and vegan products on the shelves of our shops. How does the chain handle labor shortages and what solutions can reduce the use of live work? Perhaps Penny do not tell a big secret that we are not alone in the industry with this problem, and we are constantly facing the labor market challenges. This makes us use more and more creative solutions, as we need to keep our employees and need to replace the missing workforce. We have managed to catch up with wages in recent times and have units where the third generation is working for the company within a family. Of course, there are processes that need mechanization, but in general, the proportion of human labor is still a majority at Penny. For example, the recently introduced self-service coffers do not support the machine replacement of valuable workforce, but to quickly and convenient customers. It is also important to note here that expanding payment solutions is a definite reaction to ever-changing customer needs, which are essential to remain a modern company. What are your future plans for the chain in Hungary? The next tangible result of our aspirations is the expansion of our Karcag Logistics Center worth HUF 7 billion (US$ 180mio) and the upcoming opening of our Hajdúsámson store. In both cases, we work closely with the local governments, and as an employer, we play an important role in the settlement. Our more than a quarter of a century of presence behind us in the Hungarian market is clearly evidence of planning for the long term, continuously researching the possibility of developing our Hungarian network or in which part of the country to open our latest shops. At the same time, the currently in force is making it difficult to open new stores. We will hand over our next new business in Hajdúsámson during the fall. See here for more: https://www-portfolio-hu.cdn.ampproject.org/c/s/www.portfolio.hu/gazdasag/20220704/50-milliardos-rebranding-folyamat-zajlik-a-penny-nel-554089?amp

Consumer group Which? has again named discount retail chain Aldi (German family owned) as the cheapest UK supermarket. With savings of £12.62 (US$15.36) compared to the average Big Four basket, Aldi shoppers can be confident they’re getting the best deal. Which? conducted its monthly Cheapest Supermarket price comparison and looked at the cost of a basket of 47items, including groceries and household essentials, with Aldi coming in cheapest at just £74.23 (US$90.37). The same shopping cost a whopping £16.91 (US$20.59) more at Morrisons and £12.54 (US$15.27) more at Tesco. The independent consumer group’s research also found Aldi to be a massive £25.23 (US$30.72) cheaper than the most expensive supermarket, Waitrose, for an equivalent basket of items. The full results of the research are as follows: RetailerAv. £ Index Aldi 74.23 100.0 Lidl 75.61 101.9 Asda 83.22 112.1 Sainsbury’s 86.27 116.2 Tesco 86.77 116.9 Morrisons 91.14 122.8 Ocado 95.33 128.4 Waitrose 99.46 134.0 Julie Ashfield, Managing Director of Buying at Aldi, said: “We know that across the nation many families are finding things tough due to the cost of living crisis. At Aldi, we’re determined to help by keeping costs low and quality high for our customers. We’re thrilled to yet again be named the UK’s cheapest supermarket.” See here for more: https://www.theretailbulletin.com/food-and-drink/aldi-retains-title-of-uks-cheapest-supermarket-03-08-2022/

Shoppers are increasingly feeling the effects of soaring inflation in the US. Some say they are switching to dollar stores and buying in bulk to try and combat rising prices, The Wall Street Journal reported. Elayna Fernandez, a mother of four, told the Journal that she had recently bought a Walmart Sam's Club membership so she could bulk buy items such as shampoo and conditioner. Fernandez also said she had switched to own-private label brand items for groceries such as granola bars and almond milk. In addition, she replaced one of her daughter's night lights with glow-in-the-dark stars to save on electric costs. Lily Penelope, a San Antonio resident, told the Journal that they could not afford the cost of groceries paired with the transport it costs to get them to the nearest H-E-B store. Now Penelope, who uses gender-neutral pronouns, says they are mainly eating canned vegetables, chicken, and peanut butter from a nearby Discount Variety Retail Chain Dollar General that didn't stock fresh produce. Only 2,300 Dollar Generals out of 18,000 across the US supply fresh groceries, a Dollar General spokeswoman told the WSJ. As Insider's Mary Hanbury reported, Dollar stores have existed in the US for decades and started to take off in the post-World War II economy. In the modern era, many have raised prices in line with inflation, however. Representatives for Dollar General did not immediately respond to Insider's request for comment outside normal working hours. A spokesperson told the Journal: "While Dollar General isn't a full-service grocer, we consider ourselves today's general store by providing nearby and affordable access to daily household essentials, including the components of a nutritious meal." Penelope said their health and quality of life had reduced after making the switch. "I'm in a position where I'm having to choose between making meals I can afford and putting my health on the line," they told the Journal. As of June 2022, inflation was at the highest rate since November 1981, Insider reported. Food prices have also been creeping up throughout the year, with data from the Bureau of Labor Statistics showing a year-over-year rate of 10.4% in June. See here for more: https://www.businessinsider.com/dollar-stores-shoppers-soaring-inflation-groceries-sams-club-2022-8

Discount Retail Chain Aldi South (German family owned) started operating fresh platform in the Rhein-Main region. With the intelligent logistics concept of the fresh platform, the discounter bundles fruit and vegetable logistics at one location. This reduces the time and the way from the producer to the table of customers to a minimum. The fresh platform of Aldi Süd ensures the highest quality and availability of goods in the fruit and vegetable shelf. Important cooperation with strategic partners “We are pleased that we are now rolling out the concept of the fresh platform in the populated Rhine-Main region. This was only possible because we have been working with our suppliers in partnership for many years and have now been able to implement a freshness concept with them, ”explains Uli Voigtsberger, Director Buying at Aldi Süd. In the fresh platform, all services are centrally bundled from the import of goods to the sorting, disposition and quality control to delivery to the regional companies. As a result, the discounter shortens the supply chain and designs its logistics more efficiently in order to offer even more freshness and quality. "Through direct collaboration with producers in the origin, we also gain complete transparency along the entire supply chain," says Uli Voigtsberger. Therefore, Aldi Süd is also planning for the future to implement the concept of the freshness platform promptly in other regions. Together with the long-standing supplier fruchtimport van Wylick GmbH as a partner, another freshness platform is expected to start operating in North Rhine-Westphalia in spring 2023. See here for more: https://www.fruchtportal.de/artikel/intelligente-logistikkonzept-aldi-sd-wird-noch-frischer/056284?i=b76dd810

Discount Retail Chain QualiSave (owned by South African Pick n Pay) was launched last Monday (15 August) aiming at middle-market South African shoppers. The group initially said in May that it would re-organise its stores into two brands, Pick n Pay, serving more-affluent customers, and a new brand provisionally named “Pick n Pay Red”, now revealed to be QualiSave to focus on customers in the growing middle market by providing lower prices Pick n Pay QualiSave stores will offer customers a range of 8,000 products, with an emphasis on unbeatable meat, fresh produce and bakery, as well as a keen focus on essential commodities, the group said, adding that around 40% of Pick n Pay company-owned supermarkets will be converted to Pick n Pay QualiSave. “Pick n Pay QualiSave perfectly describes exactly what these stores will offer exceptional prices for quality goods alongside a high-quality shopping experience,” said Pick n Pay Group CEO, Pieter Boone (former Metro Executive). “We have done an enormous amount of research to understand exactly what customers want and need. We concluded that we could not successfully meet the needs of all our customers with just one Pick n Pay brand. Freshness, value for money and customer service were non-negotiable demands across all customers, but they wanted their favourite stores to be better tailored to their specific needs. “Through Pick n Pay QualiSave, we are focusing on what a growing number of customers want in the important middle market while remaining entirely true to the Pick n Pay brand and values. Customers in Pick n Pay QualiSave stores will benefit from great fresh products, an excellent commodity offer, attractive special offers, a great store ambience, and friendly and helpful staff.” Pick n Pay QualiSave’s tagline: ‘Where lower prices look better’. Boone said that the announcement places the group in a stronger position to serve shoppers better across its now three banners. Boxer for aspirational customers with tight budgets, Pick n Pay QualiSave for the growing middle market and Pick n Pay at the higher-end. “Alongside Boxer, our two Pick n Pay brands now perfectly enable us to deliver the right products, at the right prices, to the right customers. And, above all, everyone remains welcome at our stores, whichever store they shop at.” Stores to be rebranded Pick n Pay QualiSave around the country have been identified through careful consumer modelling, the group said. From September 2022, Pick n Pay QualiSave stores will have the new brand name and will over time be revamped to make them easily distinguishable from Pick n Pay stores, the group said. The approach will include a new store layout, distinctive in-store signage, and product selection specifically aimed at the growing middle market shopper base. Six Pick n Pay QualiSave stores and four Pick n Pay stores have already been revamped over the last three months and have yielded positive trading results, the retailer said. See here for more: https://businesstech.co.za/news/trending/616677/a-look-at-pick-n-pays-major-new-supermarket-brand-qualisave/

Discount Retail Chain Lidl International (owned by the German Schwarz Group) started the venture Tailwind Shipping Lines & Co., a subsidiary of the German discount chain Lidl. To maintain the stability of its supply chain, Lidl has purchased and chartered four large container ships under the name Wiking to operate the China-Europe line, with stops at key ports in China, Slovenia, Spain and the Netherlands. A new Wiking container liner shipping route between Taicang in the eastern Chinese province of Jiangsu and Rotterdam in the Netherlands started on Sunday. The German ship Wiking is the first container ship to be commissioned on the liner shipping route between Taicang and Rotterdam. It measures 255.33 meters in length and is loaded with 2,000 TEU. Currently, one trip every 16 days is planned on the route. The number of ships will increase in the future and be gradually adjusted to one trip per week, depending on the market situation. “The goal is to be able to manage the increased volume of different production facilities more flexibly in the long term,” Wolf Tiedemann, who heads up logistics operations for the German retailer, told German logistics title VerkehrsRundschau earlier this month. Lidl operates around 11,200 stores and is active in 32 countries, recently entering the US market. See here for more: https://www.agf.nl/article/9446760/nieuwe-containerlijn-route-verbindt-taicang-met-rotterdam/