Flying Tiger Copenhagen (privately owned by Treville) is a variety discount retail chain that sells everything from teapots to games at affordable prices, is planning a significant expansion involving hundreds of new shops across the world. Chief Executive Officer Martin Jermiin says the Danish company, which already operates almost 900 stores across 26 countries, will add more than 200 to that figure as it emerges from a two-year period of consolidation. The growth plans follow a change in ownership, after EQT AB sold Flying Tiger to Treville, which brought in new money. Most of the new shops will be in the Middle East, and Jermiin told Bloomberg that talks are already under way to launch another 500 stores around the world. Flying Tiger has spent the past years trying to right itself after a period of losses that started even before the pandemic. After opening a new shop every third day in the years leading up to 2019, the company was suddenly burdened by a growing mountain of debt as sales failed to keep up with costs. Jermiin says a turnaround plan set in motion two years ago helped Flying Tiger recover. The company has closed unprofitable stores, cut jobs and exited some countries. Still, Flying Tiger didn’t make a profit in 2020, after losing a combined 765 million kroner (US$125 million) in 2018 and 2019, he said. It’s due to release its full-year results in the coming weeks. Jermiin estimates that the pandemic alone wiped roughly a third off Flying Tiger’s revenue. “But we’re very comfortable with our performance after the reopening and we expect to be profitable during the year and probably soon.” The Middle East expansion will use a new franchise model, the CEO said. Flying Tiger has already signed a deal in Saudi Arabia with Fawaz Alhokair, which operates Zara and GAP stores, and one in Israel with Fox Group, a local operator of Nike and Disney brands. ”We have spent about a year on this new franchise model and now we are ready to start,” the CEO said ”It’s a large expansion plan but we have learned from experience that it should be conducted in a controlled manner.” See here for more: https://www.bloomberg.com/news/articles/2021-06-09/flying-tiger-steps-up-global-expansion-and-opens-200-new-stores

The sales of the two food discounters continue to grow much faster than the mass distribution average in many countries. This largely consolidates their market shares, especially in France, Spain and the United Kingdom, while their situation is more contrasted in the historical discount markets. The pandemic and the expansion are giving wings to discounters Aldi and Lidl. According to data from NielsenIQ, which closely monitors the performance of predominantly own-brand supermarkets, "these brands tend to consolidate the trends observed in 2020". That is to say, to do better than the average for brands in terms of sales growth. Cumulatively to date at the end of May, the growth in sales of PGC-FLS reached + 6.8% in France at discounters (excluding Leader Price), while it is only 1% for the entire sector. of mass distribution. Data very close to those observed in Spain. In Italy, the SDMP are at + 7.5%, more than double the average. And in the United Kingdom, discounters are even recording double-digit increases, against a solid but less impressive + 3.5% on an industry average. The situation is different in Germany, where the discount lost ground in 2020, and where current sales decline slightly in this format, while they are progressing overall by 3% across all brands. The major difference in analysis lies in the dominant discount positions in this country (more than 40% of market share) compared to the many other European countries in which this format is in the process of conquest, as in France, UK, Spain or Italy. Moreover, Nielsen points to "very disparate performances" for discounters in 2020, with a decline observed in mature markets with respect to this format, offset however by "an almost faultless" in the most important markets, in which Aldi and Lidl have almost systematically gained ground against their competitors. The gain in new consumers explains this vitality, as does the return to expansion, as in France. After years during which the parks have not changed, Aldi (via the takeover of Leader Price) and Lidl (which is targeting around fifty openings per year) are focusing on both internal and external growth. See here for more: https://www.lsa-conso.fr/aldi-et-lidl-poursuivent-leur-forte-poussee-en-europe-depuis-le-debut-de-l-annee,383978

Discount Retail Chain MERE (owned by Russian Torgservis and managed by Svetefor) is a Russian ‘hard discounter’ similar to the initial model of the German discounters Lidl and Aldi. Stores similar to Soviet warehouses, austere aesthetics, aisles delimited by pallets, low prices and costs reduced to the maximum. The description could well correspond to the initial commercial model of the first discount stores that the German Lidl and Aldi implanted in our country, but we are not talking about They, but MERE, the chain owned by the Russian group Torgservis, which has just landed in Spain, through Svetefor's, and whose model evokes the first 'hard discount' centers imported from Germany. And it is precisely in the gap left by the German companies Lidl and Aldi, they evolved in their respective business models towards a 'smart discount' concept, where MERE has found a business opportunity, also sponsored by the economic crisis that lies ahead. the impact of the pandemic. Although unlike Lidl and Aldi and what we could consider a traditional 'hard discount' with the MDD as the protagonist of the commercial offer, 100% of the products marketed by MERE are manufacturer's brands and the company is currently consolidating a panel of suppliers, of which "more than 60% are national." That is why, in the words of Andrey Murzov, CEO of MERE Spain, "ours is an extraordinary business model, which allows us to act without direct competition in Spain." MERE supports its main competitive advantage in manufacturer brand price, offering products between 10% and 20% cheaper than those of its direct competition. The chain's formula "involves the sale of drugstore, perfumery, bazaar and other family products that allow us to maintain the planned margin," they point out. And how does it manage to reduce prices so much? In the first place, it requires from its suppliers a cost between 20% and 30% lower, including transport to the supermarket, and up to 50% in the case of well-known brands, as well as the return of all unsold products. In return, the packaging can be as simple as possible. Second, its strategy is based on lowering costs at the point of sale, with significant savings in rents and basic equipment, making the sale from the pallets or boxes of the products. And third, through a new logistics system. MERE makes direct truck deliveries from the supplier's factory to their stores. At least for the moment, the group does not consider having intermediate warehouses for these operations. This would make it a unique and exceptional case among retailers, who tend to centralize their suppliers' loads on platforms to streamline subsequent delivery to stores. Also for this reason, the chain's establishments will be located in locations that allow easy access to the supply vehicles of their suppliers, either within the population center or within walking distance, in industrial estates or access roads, with parking for 30-40 vehicles. In any case, "the location does not matter so much, as long as the place is close to a population of more than 20,000 inhabitants," they point out. MERE also looks for premises that require a very basic investment, with almost no need for work. The dimensions of its premises will be from 800 m² and up to 1,500 m². The standard workforce will be made up of 10-11 workers per store. Ten stores operational by the end of 2021 MERE has already put his first foot in our country with several projects in the portfolio. The first known, a store in the Madrid town of Parla, perfectly exemplifies its strategy, as it is located in a 1,400 m² warehouse on Avenida de la Ronda, one of the access roads to the city from the south and the area of commercial development. To this project will be added, during the months of May and June, four openings in the Valencian Community, specifically in the Valencian towns of Gandía, La Pobla de Vallbona and Aldaia, and the Alicante town of Petrer, in the Dynamia shopping center. The set objective is to reach the ten openings by the end of 2021. Apart from Madrid and Valencia, other priority areas for the group are Catalonia, Murcia, Andalusia and Castilla-La Mancha. Torgservis already has more than 1,000 operating stores in Russia, Germany, Lithuania, Poland and Romania, both under the 'Svetofor' brand, with which it started operations in its country of origin in 2009, and under 'MERE', aimed at European countries. The company plans to expand into all markets in the European Union. See here for more: https://www.alimarket.es/alimentacion/noticia/330710/mere--el--hard-discount--ruso-simil-al-modelo-inicial-de-las-alemanas-lidl-y-aldi

Discount Retail Chain Dollarstore's (privately owned) new central warehouse of 55,000 square meters will soon be open for operation and will supply all 118 stores in Sweden. We look forward to opening the doors to Dollarstore's new distribution center in Örebro. We see several advantages in choosing Örebro as the location for our distribution; Among other things, a shorter transport distance to our stores, as Örebro has a central location in relation to our discount store, good railway connections to ports and our Norrland stores, as well as good conditions for future recruitments. We reduce transport distances to the stores and get closer to our suppliers, which results in shorter lead times, more sustainable for the environment and a cost reduction. In the long run, we look forward to welcoming 200 new employees to our new center, which opens for operation at the end of June, says Erik Landström, Operations Manager, Dollarstore. See here for more: https://press.businessregionorebro.se/posts/pressreleases/vi-valkomnar-dollarstore

The COVID-19 pandemic left no industry untouched. Grocers in North America, along with those in other regions of the world, served as essential businesses and critical players in ensuring food supply during a time of great uncertainty. Customer behaviors shifted dramatically and rapidly during the pandemic, forcing grocers to adapt in kind. To prepare for what lies ahead, North American grocers must understand the new industry baseline, the nuances of key consumer shifts observed over the past year, and the behaviors and preferences that will endure once the pandemic abates. Our research suggests the next normal will be shaped by five factors in 2021 and beyond. The radical shift in grocery-shopper behavior When will the COVID-19 pandemic end? COVID-19: Implications for business The search for purpose at work The future of work after COVID-19 Grocers gained significant “share of stomach” during the pandemic as consumers across North America shifted to living, working, and learning at home. In an industry that has traditionally seen growth of 1 to 2 percent a year, North American grocery grew by approximately 12 percent in 2020, offsetting significant reductions in food away from home. The initial disruption of March and April 2020, marked by initial lockdowns and closures of all nonessential businesses, saw consumers choosing to visit grocers outside their traditional primary destinations. This trend, influenced primarily by proximity, store cleanliness, health, safety, and in-stock products, was a notable deviation from historical purchase drivers such as price, service, and in-store experience. A five-year acceleration of online penetration in a matter of months In late 2019, e-commerce penetration in North America hovered around 4 percent of sales—an important channel for consumers but still niche with certain segments (for example, younger, urban consumers). By late spring in 2020, e-commerce penetration had reached 10 to 15 percent of sales overall, with some regions (such as high-density urban areas) topping 20 percent. Adoption accelerated significantly in demographics not typically considered tech-savvy, such as baby boomers, as they sought fulfillment channels that limited health risk. This shift in behavior toward e-commerce appears to be quite sticky. Overall, shoppers have been pleased with experiences provided by grocers for both click-and-collect and delivery. Across categories, consumers indicate a continued preference of shopping online, even in traditionally hard-to-crack categories such as fresh meat and produce (an increase of five percentage points in net intent versus prepandemic).2 Shoppers also indicate that their interactions and experiences with grocers’ digital interfaces will meaningfully affect their primary grocery choices in the future: ease of selection and checkout, quick access to past orders and reordering, and transparency into in-stock products will be the most important factors to consumers. Moving to ‘one-stop’ shopping For years prior to the pandemic, grocery shoppers had been increasing both their number of trips per month and the number of grocers they visited. That trend reversed in 2020, with shoppers indicating their overall trip frequency was only half of prepandemic levels through spring and summer of 2020. While trips did begin to increase in late 2020 and into early 2021, our analysis found the number of trips today is only 35 percent of prepandemic levels and unlikely to fully rebound. As the pandemic continues, shoppers note that the winners of their primary shopping trip tend to offer affordable options and e-commerce capabilities, ensure products are in stock, and offer a robust fresh proposition. Throughout the past year, medical professionals have consistently emphasized the increased risk of severe complications from COVID-19 faced by people with underlying health conditions. This awareness has, in turn, sharpened the focus on wellness that was underway prior to the pandemic, creating shifts in category demand within grocery. Furthermore, as consumers look ahead to their food consumption in 2021, they are leaning toward “better for you” options. According to our survey, the net intent to focus on healthy eating and nutrition is expected to be up 38 percentage points over 2020, with consumers specifically seeking out naturally healthy, high-protein, low-sugar, and low-calorie foods. Increasing focus on affordability In the initial stages of the pandemic, grocery shoppers chose where to shop based on in-stock products, store hygiene, and cleanliness procedures.In the initial stages of the pandemic, grocery shoppers chose where to shop based on in-stock products, store hygiene, and cleanliness procedures. As 2020 progressed, however, affordability began to climb the ranks in importance, and 2021 is poised to see consumers demonstrate even more bargain-hunting behavior: when choosing where to shop, 45 percent of consumers indicate they plan to look for ways to save money, and 32 percent of consumers will seek a price–quality balance in product offerings (Exhibit 4). The emphasis on affordability will also likely serve as an accelerant for private label. The past year saw remarkable growth for leading private-label offerings in grocery. In 2020, for example, private-label sales rose by more than 13 percent at Albertsons and Kroger. This trajectory could continue as consumers see better value in private-label products. Growing expectation of personalization as the norm Personalization in retail has gained massive traction over the past five years, evolving from a predominantly mass promotion–based approach to segmented, customized, and real-time dynamic offers. Although the definition of personalization can be broad, consumers tend to reward retailers that combine great timing, relevant offers, and attractive pricing. This trend toward personalization is evident in the investments retailers are making. Indeed, 60 percent of leading grocery retailers indicated they had made investments in 2020 to enhance capabilities to better personalize promotions and pricing. In the battle to retain market share, personalization and its delivery will likely continue to rise in importance. How the pandemic reset the playing field for winners and losers From 2010 to 2020, North American grocers followed a path similar to that of their counterparts in other geographies. Deep discounters had entered the market and were gaining share aggressively over mass players, supermarkets, and even club players. From 2015 to 2019, discounters grew at an impressive 6.2 percent, far outpacing the growth of other grocery formats, and further national expansion plans are imminent (Exhibit 5). To defend against this threat, mass players and large national supermarkets responded with strategies ranging from significant national price drops to store remodels and supply-chain investments. All of these moves came at the expense of smaller, more regional chains. Furthermore, nearly 2,300 grocery retailers closed from 2012 to 2019. The outlook for subscale supermarkets without a differentiated value proposition versus larger mass players or national supermarkets was bleak: in the absence of a defendable value proposition, they were left to compete on price, racing to the bottom with discounters without seeing returns in traffic. We strive to provide individuals with disabilities equal access to our website. If you would like information about this content we will be happy to work with you. In a reversal from prepandemic trends, supermarkets and mass players benefited from the trends of the past year. Their seemingly endless aisles with a large SKU assortment provided consumers with options when items were out of stock. Their investments in fresh foods were a welcome tailwind as consumers increasingly sought to eat healthier foods. Furthermore, their local store density and historical community roots provided consumers with a sense of trust and confidence in shopping. And several supermarket chains rose to the e-commerce challenge by quickly bolting on click-and-collect or delivery services through third-party providers. Without having to compete primarily on price, the core proposition of supermarkets was once again attractive. Prominent supermarkets reported sales growth of anywhere from 12 to 16 percent in 2020, beating out several club and discount players alike. With consumers indicating that selected pandemic-induced behaviors will remain sticky, the landscape might continue to evolve. As North American consumers begin to adjust to the next normal, we anticipate that the landscape of winners and losers in grocery will cease to be determined by format. Instead, leaders will be defined by their differentiation, innovation, and defensibility across five main areas. Winning higher share of stomach. Before the pandemic, consumers typically split their share of stomach across more than three grocers. Most consumers had their go-to stores for fresh, center-store, and stockup products and were willing to add the additional weekly or biweekly trip to fulfill each need. In light of the pandemic, we have observed an undeniable consolidation of trips, and consumer sentiment shows no signs of changing: 88 percent of consumers visited three or fewer stores per week in 2020, and 86 percent of consumers plan to continue this trend in 2021. Forty percent of consumers indicate that they would prefer to frequent stores that sell more than just groceries. And the undeniable success of mass players in 2020 further points to improved consumer sentiment around trip consolidation. This will likely place some pressure on grocers with specialty and niche value propositions—the bar to deliver exceptional products, value, experience, and service will be higher to justify an additional trip. Clarity in what these grocers stand for and flawless execution will be key to retaining share of stomach. Credibly competing in the omnichannel battleground. Before the pandemic, select retailers whose brick-and-mortar stores provided a competitive advantage through differentiated in-store experiences, services, locations, and formats, among other attributes, considered an omnichannel presence a “nice to have” feature. Now, to compete in today’s environment, in which recent McKinsey research finds 52 percent of households shop for groceries online across a spectrum of occasions (topup, fill-in, full shop), an omnichannel presence is an imperative. Grocers will need to dissect their internal e-commerce operations or third-party models to meet growing consumer expectations for experience (such as site usability, transparency into in-stock products, and better-picked fresh produce), all while ensuring that the channel increases margins, particularly when it is on pace to account for upward of 20 percent of the overall business. Elevating pricing and value. While store cleanliness practices and product availability dictated where consumers chose to shop in 2020, convenience and value will carry the day in 2021. An estimated 32 percent of consumers indicated that a healthy price–quality equation will dictate where they choose to shop in 2021, and 45 percent of consumers will look for ways to save money. The increased momentum in private label further supports consumers’ renewed focus on value. Grocers will need to carefully consider how to invest in pricing and promotions—2020 saw a reduced period of promotional activity owing to the surge in grocery demand, but we anticipate a return to more strategic pricing and promotional activity in 2021. Renewing the focus on fresh, new, and innovative. During 2020, a sense of nostalgia made consumers turn to products from their childhood, particularly in the center of the store, and we observed a reduction in the typical innovation-charged new-product releases. However, as fatigue sets in around cooking at home, we expect consumers to demand more innovation across fresh, ready-to-eat, and frozen products. In our sample, 39 percent of consumers want grocers to introduce them to innovative products and experiences, 41 percent want to eat better, and 42 percent plan to continue to cook meals from scratch at home in 2021. These preferences all point to the need for grocers to have a strong fresh program and an assortment across departments that delivers on both better-for-you and new and exciting consumer needs. Accelerating personalization. While affordability perception continues to be a primary driver of store selection, personalization is growing in importance. Consumers are looking for simplicity, a sense that the offers and messages are tailored to them, continued innovation in offers, responsiveness to consumer behavior versus a preset calendar, and seamless integration of a retailer’s different programs. Consumers want to feel recognized as individuals by grocers, which will have to engage beyond relying on mass promotional activity as the answer to share retention. To meet these expectations, grocers will need to rally their organizations around a strategy and vision for personalization; clearly define an operating model between merchandising, pricing, and loyalty teams; and invest in the technology to support the personalization vision. See here for more: https://www.mckinsey.com/industries/retail/our-insights/the-state-of-grocery-in-north-america?cid=other-eml-alt-mip-mck&hdpid=0810ce03-4548-4403-8739-d762f07d4698&hctky=12586624&hlkid=caab885eb568471d9e98d2793dd41ca3

Discount Retail Chain Aldi Ireland’s (family owned) Ashbourne Project Fresh store has reopened its doors to customers following an extensive renovation project, which has seen the store completely refurbished. The newly refurbished store has received a full makeover in line with Aldi’s award-winning Project Fresh design, the discounter said. Featuring the new layout, the Ashbourne Store offers a wide selection of fresh food at the front of the store, hi-spec fixtures and fittings and new signage that provides a more efficient and hassle-free shopping experience. Speaking at the reopening, Niall Daly, Ashbourne store manager said, “The Project Fresh revamp of our store is great news for our local customers in Ashbourne. Its new spacious design makes for a very easy and enjoyable shop.” Green Energy The store will be powered by 100% green electricity. Aldi has invested heavily in improving its energy management systems and its entire store network is now powered by 100% wind generated energy. Aldi has achieved ISO 50001 accreditation in recognition of its efforts to improve energy efficiencies. Local Producers Aldi now operates six stores in Co. Meath. In 2020, Aldi highlighted it sourced over €50 million (US$60 million) of locally produced food and drink from Meath based suppliers. The retailer now partners with 12 Meath producers, and last year began working with four new suppliers in County Meath. In March 2020, Aldi reduced its payment terms for all suppliers that transact up to €1 million (US$1.2 million) worth of business annually with Aldi. Payments are processed and paid within five working days and this is extended to the end of 2021. See here for more: https://www.checkout.ie/retail/aldi-unveils-revamped-ashbourne-project-fresh-store-135877

Discount Variety Retail Chain Dollar General plans to continue expanding its Dollar General Market format, with around 16,000 square feet of selling space and lots of perishables. In April, a team of Yale University public-health professors published a 34-page study that explained how to end the pandemic in America. The researchers’ conclusion? Dollar General. The Goodlettsville, Tenn.-based retailer is now the closest grocery store for millions of U.S. consumers; 75% of Americans live within 5 miles of a Dollar General. Adding COVID-19 vaccination clinics to Dollar General’s massive store footprint would get vaccines in the arms of the people most in need of them, thus giving America its best shot at ending the COVID-19 crisis, the researchers argued. The Centers for Disease Control and Prevention (CDC) quickly agreed. “We’re exploring a promising collaboration with Dollar General stores, which have locations within 10 or 15 miles of our rural communities in all but four states,” said Dr. Rochelle Walensky, director of the CDC, in a recent interview with the New Haven Register, in Connecticut. So far, Dollar General hasn’t revealed that it’s joining the federal Retail Pharmacy Partnership Program, which includes Kroger, Walmart, Costco and a number of other food retailers. For Dollar General, which has more U.S. stores than Kroger, Walmart and Costco combined, retail health would be another new frontier, in addition to fresh grocery and e-commerce. But the fact that Yale University and the CDC would select Dollar General as the ideal retailer for vaccine distribution, as opposed to Walmart or CVS, speaks to the company’s position of power in the food retail industry, a position that is set only to strengthen as it deploys several new strategic initiatives ideally suited for the post-pandemic economy of 2021 and beyond. Since 2019, Dollar General has been expanding its grocery assortments, including international products, as traditional grocery chains have consolidated and closed locations. It’s no secret that the pandemic has turbo-charged growth at many food retailers. But perhaps no retailer has benefited more from pandemic-related consumer behavior trends than Dollar General. Even before COVID, the retailer was already taking advantage of economic recessions, retail consolidation and a new fondness among consumers for frugality (and discounters) to amass impressive revenue and expansion over the past decade. Now, post-COVID, the company is planning to leverage momentum from the pandemic to keep aggressively opening stores, become even more of a grocery store than a dollar store, ramp up digital capabilities and hire tens of thousands of new workers to help drive all of that new growth. In 2020, Dollar General opened more than 1,000 new stores, and remodeled another 1,670 locations. This year, Dollar General plans to open 1,050 new stores, remodel 1,750 stores and relocate 100 stores, representing 2,900 real estate projects in total. With a current (as of this writing) footprint of 17,266 stores, Dollar General is riding a wave of favorable socioeconomic conditions to a projected 18,316 locations by the end of 2021. Historically, the more stores the company opens, the more profit and revenue it generates, and the more it can keep opening more stores. And Dollar General isn’t stopping at 18,000 or even 20,000 stores. During the company’s latest earnings report, Dollar General COO Jeff Owen said that the retailer is looking at a possible 34,000-plus store footprint. Much of the store base will remain rural, but the company has a new focus on the suburbs as a result of the pandemic-related exodus from urban areas. “Through a combination of our growing relevance with customers, format innovation, an evolving retail landscape and leveraging new technologies, we estimate a total of approximately 17,000 new store opportunities available across our format types, which we believe represents a long runway for new unit growth,” Owen said. Beyond opening new locations at a frenetic pace, Dollar General is also experimenting with more new formats. The company has its traditional store format (around 7,300 square feet), plus newer designs such as the DGX urban format (around 4,000 square feet) and the Dollar General Market format (around 16,000 square feet), all of which the company plans to keep growing. In March, however, the company said that it’s making “key changes to its development strategy,” including plans to build on the success of its Dollar General Plus Store, or DGP, format, and the introduction of two more formats, which the company began testing in 2020. THE ROAD TO 34,000 STORES 2021: 18,227 (est.) 2020: 17,177 2019: 16,278 2018: 15,370 2017: 14,534 2016: 13,320 2015: 12,483 2014: 11,789 2013: 11,132 2012: 10,506 2011: 9,937 2010: 9,372 2009: 8,828 2008: 8,362 Source: Dollar General financial reports “Similar to our larger-footprint DGP concept, the first new format has selling space of approximately 8,500 square feet, which compares to about 7,300 square feet of selling space for our traditional store,” CEO Todd Vasos said. “Beginning later this year, this new format, along with our DGP concept, will become our base prototype for nearly all new stores, replacing both our traditional and higher cooler-count DGTP format, allowing for a more optimized assortment and room to accommodate future growth.” According to Vasos, the company’s second new format is even larger, with approximately 9,500 square selling feet, and will be deployed opportunistically across new store relocation and remodel opportunities. “Notably, on average, our DGP and new store formats are outperforming the chain on a comp-sales basis and have considerably higher sales volumes compared to both the traditional and DGTP store, which bodes well for the future as we look to increase their unit counts in the years ahead,” Vasos said. For the fourth quarter ended Jan. 29, Dollar General reported that same-store sales increased by 12.7% on a year-over-year basis and operating profit was up 21% to US$872 million; revenue increased 17.6% to US$8.4 billion. For fiscal 2020, Dollar General’s same-store sales were up 16.3% and its operating profit grew 54% to US$3.6 billion; revenue increased 21.6% to US$33.7 billion. The retailer did forecast, as have others in the industry, such as Albertsons Cos. and Grocery Outlet, that it expects a same-store sales decline of 4% to 6% in fiscal 2021. However, on a two-year stack basis, the company projects that it will see comps increase 10% to 12% when compared with the company’s performance in 2019. Vasos said that the company is seeing increased market share in highly consumable product sales, as well as new subsets of customers. “These new customers continue to skew younger, higher-income and more ethnically diverse, underscoring the broadening appeal of our value and convenience proposition,” Vasos noted. “We continue to be encouraged by the retention rates of new customers, and we are working to drive even higher levels of engagement with more personalized marketing and continued execution of our key initiatives.” The larger market share and new customers can most likely be attributed to the retailer’s other key initiative for growth: fresh food. Dollar General’s cooler expansion program continues to be the retailer's most impactful merchandising initiative, CEO Todd Vasos said. Since 2019, Dollar General has been expanding the availability of fresh food at its stores as grocery chains consolidate and close locations, and more consumers seek a nearby one-stop shop for healthy perishables and essentials. That year, the retailer launched its DG Fresh initiative aimed at adding fresh and frozen food products to store assortments and enhancing distribution of those cold-chain consumables. At the end of 2020, around 1,100 Dollar General locations offered perishable grocery, including many of its Dollar General Market stores. The company plans to add produce to approximately 700 more stores in 2021, bringing the total number of stores that carry produce to more than 1,800. “DG Fresh continues to be the largest contributor to the gross-margin benefit we are realizing from higher initial markups on inventory purchases, and we expect this benefit to grow as we continue to scale this transformational initiative,” Vasos said. Another important goal of DG Fresh is to increase sales in the fresh food categories, he added. “We are pleased with the success we are seeing on this front, driven by higher overall in-stock levels and the introduction of new products in select stores being serviced by DG Fresh,” Vasos observed. In 2021, Dollar General plans to further accelerate the rollout of additional fresh offerings, including both national and private brands, as the retailer looks to further optimize its assortment while increasing its relevance with customers. “We believe DG Fresh provides a potential path forward to expanding our produce offering to more than 10,000 stores over time as we look to further capitalize on our extensive self-distribution capabilities,” Vasos said. In total, Dollar General’s replenishment network is now distributing to more than 16,000 stores from 10 facilities. Dollar General plans to open two new DG Fresh distribution facilities this year, and add tens of thousands more cooler doors to stores. “Our cooler expansion program continues to be our most impactful merchandising initiative,” Vasos said. “During 2020, we added more than 62,000 cooler doors across our store base. In total, we expect to install more than 65,000 cooler doors in 2021 as we continue to build on our multiyear track record for growth in cooler doors and associated sales.” At its traditional stores that have been remodeled with 22 coolers, the company typically sees a 4% to 5% rise in same-store sales. At its larger stores, where there’s room for 34 higher-capacity coolers, there’s a 10% to 15% rise in same-store sales. In addition to the margin benefits associated with DG Fresh and the retailer’s Non-Consumables Initiative, the company continues to pursue additional opportunities to enhance gross margin, including improvements in private-brand sales, global sourcing and supply chain efficiencies. “Our plans for 2021 include further expansion of our private fleet, which accounted for more than 20% of our outbound fleet at the end of 2020,” Vasos said. “Reducing stem miles is also an important contributor to these efforts, and the recent opening of our Walton, Ky., dry distribution center is expected to drive additional efficiencies as we move ahead.” The company’s private fleet program has grown from 80 tractors at the end of fiscal 2017 to more than 700 tractors and more than 550 drivers in spring 2021. Dollar General recently embarked on a hiring spree to support all of these initiatives. In April, the company said that it’s planning to hire up to 20,000 new employees this spring to support efforts across its store, distribution, transportation and corporate operations. The company also revealed an employee training partnership with Waterloo, Ontario-based Axonify to enhance business learning and development for its more than 157,000 front-line, supply chain and corporate employees. For the time being, the retailer says that it’s seeing increased labor productivity as a result of its Fast Track initiative, an in-store replenishment program that optimizes operations at the warehouse to speed up shelf stocking and decrease out-of-stocks. The second component of Fast Track is self-checkout, which was available in more than 1,600 Dollar General stores at the end of 2020. The company is on track to have self-checkout in the majority of its stores by the end of 2022. Dollar General continues to pursue additional opportunities to enhance gross margin, including improvements in private-brand sales, global sourcing and supply chain efficiencies. As a mature retailer in growth mode, Dollar General is laying the groundwork for future initiatives the company believes “will unlock additional growth opportunities as we move forward,” in Vasos’ words. One of those future initiatives is the expansion of digital, an area where Dollar General has lagged. The retailer’s strategy has been to build a digital ecosystem tailored to provide its core customers with a more convenient, frictionless and personalized shopping experience. How’s that going so far? “We made significant progress in 2020, highlighted by the accelerated rollout of DG Pickup, our BOPIS offering, to more than 17,000 stores,” Vasos said. “During the year, we also saw continued growth in customer engagement across our digital ecosystem, including our digital coupon offering, shopping list feature, cart calculator shopping and budgeting tool, e-commerce site, DG Go! mobile checkout, and our mobile app, which ended the year with nearly 4 million monthly active users.” Looking ahead, Dollar General plans to focus on offering an even more personalized digital offering, with the goal of driving higher levels of customer engagement and loyalty. The company also intends to expand its FedEx package pickup and dropoff service, now available in 8,500-plus stores, to more than 9,500 stores by year-end. “We operate in one of the most attractive sectors in retail,” Vasos noted. “And in an environment where customers continue to seek safe and convenient experiences, we believe our unique store footprint, further enhanced through our multiyear initiatives, provides a distinct competitive advantage and positions us well for continued success. We feel very good about the underlying business, and I’m excited about the opportunities that lie ahead.” See here for more: https://progressivegrocer.com/how-dollar-general-disrupting-grocery

Discount Retail Chain Lidl Sweden's Plus App and customer club have gotten off to a better start than expected. "Compared to other companies, we offer much more," says Robert Stekovic, commercial director. Lidl's commercial director Robert Stekovic is pleased with the app's development. It is now six months since Lidl launched its customer club and app. The low cost discount retail chain is very pleased with the results. "We get very positive feedback in the stores, although of course we also received some negative comments on social media. But that's how it usually looks", says Robert Stekovic. "Perhaps the fairest thing is to look at numbers and according to Lidl, these are very good. Hundreds of thousands, or about 20 percent of customers, currently use the app. More people have downloaded and used the app at checkout than the goal was, so we have had to adjust our goals", states Robert Stekovic. Recently, Lidl also changed its bonus system. Previously, regular customers received digital scratch cards with gifts, now the refund takes place instead in the form of a staircase. When the customer has reached SEK 1,000 (US$121) during the same month, they receive SEK 10 (US$1.21) back in the form of a coupon and when the customer has reached SEK 2,000 (US$242), an additional SEK 25 (US$3) is added. So it continues up to the maximum ceiling of SEK 8,000 (US$969) where the customer has received a total of SEK 300 (US$36) back. "Together with sharp membership offers and other benefits, we offer much more than other companies, even if customers do not really compare different bonus systems in that way", says Robert Stekovic. The technology behind the app is developed at Lidl Spain, where the discount chain has its technical office. "If you compare with other countries, the development in Sweden is good. We are not at the top but much higher than many other countries. Lidl Sweden has a fairly young customer base and the population has a high digital habit." What features can we expect in the future? "There will be a lot of focus on customer-specialized offers and then there will definitely be further development of the scratch card. There is great potential there, not least when it comes to third-party offers. A couple of weeks ago, for example, we had a promotional code in collaboration with Nike." See here for more: https://www.fri-kopenskap.se/article/view/795601/lidlchefen_om_appen_gatt_battre_an_vantat?token=mp20g3mhioehhmayjdmhldbokq0ucca1

Discount Retail Chain Lidl US (owned by the German Schwarz Gruppe) CEO Michal Lagunionek, the discounter’s fourth U.S. chief executive in its relatively short stateside history (entering the US in 2017), is the first of them to also be a member of parent company Schwarz Group’s management board. That arrangement is similar to how the company operates in important overseas markets like Germany. Significant also is that the oversight board had reportedly wavered as to whether to continue its U.S. invasion at all. A report in the German trade press earlier this month said that decision came only after a “long hesitation.” Similar chatter of abandoning the U.S. accompanied the appointment three years earlier of Lagunionek’s outgoing predecessor, Johannes Fieber. Some sources told WGB this speculation is typical of frothy industry coverage in the European trade press, but also reflects on the longstanding mysterious nature of privately held German discounters like Lidl and Aldi that tend to quietly operate below the radar and let economic trends and word-of-mouth gradually deliver business to them: Schwarz Group’s owner and founder, Dieter Schwarz, for example, is said to have never given a recorded interview nor allowed himself to be photographed. Forbes recently listed Schwarz as the 38th wealthiest person in the world. The history of discounters and the unique proposition they bring to shoppers as they expand also suggests their growth is a stealth, long-term play likely to be spread among multiple leaders over time. This also attests to the significance of Lidl’s decision to re-commit in the U.S., which possesses the size and population to become a leading contributor. Economic trends, a willingness among shoppers to embrace private brands, and small-store convenience also play in their favor over the longer term, sources says. “It’s always a long-time game when it comes to Aldi and Lidl,” Katrijn Gielens, a professor of marketing at the University of North Carolina’s Kenan-Flagler business school who studies discount retail, told WGB in a recent interview. “Don’t forget that neither of them are publicly listed, so they can usually afford to wait longer than what you would typically encounter with a listed company that has to report quarterly. And that is the typical scenario that happens their markets: They grow steadily.” The growth in discount stores is faster in units than in shoppers or market share. That is a byproduct of their unusual business model and value proposition, Gielens says. It takes time for U.S. shoppers to come to understand how to shop the hard-discount model, and their small stores typically draw from tight geographies, so customers lean about them in small increments. Their cost-conscious approach in the meantime typically does not budget for traditional national advertising campaigns, Gielens added. “People are usually very surprised when they find out that Aldi has been in the U.S market since the 1970s,” Gielens says. “They typically don’t know about them until they actually literally enter in their market around the corner, so to speak. That’s only when you really first encounter them.” A Big Push From Poland A Lidl spokesperson declined WGB’s requests for an interview with Lagunionek, whose only public remarks since taking the role was a statement accompanying notice of Fieber’s departure: “I look forward to working with the Lidl US team to continue to strengthen and grow our store network, and provide shoppers across our communities with incredible quality and unbelievable prices every day.” He's noted for having led Lidl as CEO of its division in Poland between 2006 and 2016, before moving to a board position at its headquarters in Germany. Poland has become something of a cradle for Lidl’s international leaders over the years: Radosław Liberski has been CFO in the US since 2019; and Lagunionek’s successor as Poland’s CEO, Maksymilian Braniecki, last year took over its Central and Eastern Europe divisions, noted Sebastian Rennack, a senior retail analyst covering Central and Eastern Europe for Lebensmittel Zeitung, the German industry trade. Lidl entered Poland as a newcomer in 2002. Today it is the country’s third-largest grocery chain and by Rennack’s figuring, its most profitable, with more than 500 stores generating 5 billion Euros in annual sales, and EBIT profit margins of 7.9%, two to three three times better than most competitors. Lidl benefits especially in Poland and Eastern Europe, where its German heritage is seen a quality advantage, Rennack added. He estimates these regions together generate about 1 billion Euros (about US$1.2 billion) in pre-tax profits annually. “In my perspective, they finance their price battles with Aldi in Germany and the U.S. expansion with this,” he said. Not announced by the company but also new to the U.S. leadership team at Lidl are another two top European leaders: Dirk Fust, who previously led Lidl in Demark, will serve as Lagunionek’s top deputy, Lebensmittel Zeitung reported. And Jassine Ouali, described by the trade paper as an “up-and-coming” talent, is expected to join the management team this summer. Atlanta and Points Further In the U.S., Lagunionek joins Lidl as it takes a breath after a busy three years under Fieber, who announced his resignation last month. In addition to addressing Lidl’s early U.S. real estate missteps and converting its first major acquisition, moves seen to have stabilized the young brand after a rocky start, the coronavirus pandemic along with political and social unrest in the U.S. over the last year made for what Fieber in a letter to colleagues described as “one of the most challenging periods in a generation,” and heightened his desire to attend to his family in Europe. Lidl said last summer it would open 50 new U.S. stores by the end of this year, making a US$500 million investment that would get it to around 150 stores. That expansion, which included Best Market flips in metro New York and the reopening of acquired former Shoppers Food sites in metro Washington, is now all but complete. The coronavirus crisis and its attendant trend to limit trips to niche and specialty stores in the meantime is receding and food price inflation, historically an ally to discount stores, is expected to be on the way. Gielens said she would expect Lidl could turn expansion efforts next to greater Atlanta, which currently has a small handful of stores, plus a few owned properties dating its initial but since-altered entry plan, but is also nearing the completion of a regional distribution center in nearby Covington, Ga. Reports indicate Lidl has expressed interest in Atlanta in occupying ground-floor sites in various mixed-use and housing facilities. “Typically you’ll see them follow the distribution centers, Gielens says. “I’m quite convinced that they will expand further.” Rumblings of “dramatic” food price inflation in the meantime could create more opportunity for shoppers to discover discount stores like Lidl, indicating Lagunionek and his new team could find plenty of opportunity to gain share in the years ahead wherever they do business. “Each time you see something going on in the economy, they win,” says Gielens of hard discounters. “It sort of goes in shifts, and it always sticks, because the element that they typically use is that once you try them, and you learn about them, you probably will be convinced of the message that they’re giving here: that we do have is good quality, and it is much lower prices. What you see in a recession is the share of these guys goes up and it doesn’t go down again.” See here for more: https://www.winsightgrocerybusiness.com/retailers/whats-new-about-lidls-new-ceo

Discount Retail Chain Aldi France (German family owned) has completed almost half of the transformation plan of the Leader Price which it has acquired. More than 200 stores have already changed their brand into Aldi and the discounter is announcing 69 additional stores in June. Aldi store network in France 156,000 square meters: this is the additional area that Aldi has gained in France, in six months of work. More than 200 stores, out of the 547 bought from the Casino group, have been transformed since January to adopt the Aldi brand and concept. June is shaping up to be a particularly prolific month as the discounter plans to complete 69 additional transformations. By the fall, or at the latest by the end of the year, the Aldi chain in France will cross the 1,400 store mark. The list of Leader Prices that will be transformed in June: Auvergne-Rhône-Alpes - Saint-Marcel-lès-Valence (Laye Échangeur zone; 26320) - Ugine (25 av. Jean Marie Meunier; 73400) - Moulins (21/25 Cours de Bercy; 03000) - Saint-Just-Saint-Rambert (198 bd Jean Jaurès; 42170) Bourgogne-Franche-Comté - Semur-en-Auxois (Rue du Commandant l'Herminier; 21140) - Quetigny (Zac des Charriers - Bd du Grand Marché; 21800) - Migennes (6 & 10 av. Jean Jaurès - Lieu-dit les Écoles; 89400) Loire Valley Center - Saran (Shopping Center - Zone des 100 Arpents - Rue André-Marie Ampère; 45770) - Vineuil (Business development; 41350) Hauts-de-France - Halluin (Route de Roncq; 59250) - Lezennes (Rue Chanzy; 59260) - Nogent-sur-Oise (112 BC from Europe; 60180) - Laigneville (Departmental road 916A; 60290) Ile-de-France - Paris (16 rue Louis Braille; 75012) - Paris (154 bd de Charonne; 75020) - Savigny-le-Temple (Les Routoires activity park; 77176) - Verneuil-l'Étang (CC rue Marcel Sembat; 77390) - Saint-Germain-sur-Morin (Route de Paris; 77740) - Rosny-sous-Bois (Zac de Nanteuil; 93110) - Livry-Gargan (14/16 rue Eugène Masse; 93190) - Romainville (9 rue Paul Doumer; 93230) - Pantin (Impasse d´Aubervilliers; 93500) - Joinville-le-Pont (59, rue Gallieni; 94340) - Vitry-sur-Seine (21 av. Maximilien Robespierre; 94400) - Chennevières-sur-Marne (13 rue du Belvédère; 94430) - Le Mesnil-le-Roi (105 avenue de Poissy; 78600) Normandy - Aunay-sur-Odon (3, market place; 14260) New Aquitaine - Angoulême (548 route de Bordeaux; 16000) - Champniers (Z.A. Les Montagnes; 16430) - Ruffec (Les Champs de Longchamp; 16700) - Angoulins-sur-Mer (Zac Les Ormeaux; 17690) - Objat (11 av. Georges Clémenceau; 19130) - La Roche-Chalais (2, avenue de Charente; 24490) - Bordeaux (99 bd Albert 1er; 33000) - Villenave-d'Ornon (539 route de Toulouse; 33140) - Saint-André-de-Cubzac (La Garosse East, Chemin de Perrot; 33240) - Blaye (112 rue de l'Hôpital; 33390) - Pessac (C.C. Formanoir; 33600) - Mont-de-Marsan (Bd Jean Larrieu; 40,000) - Nérac (Lieu-Dit "Laiguillon" - Route de Lavardac; 47600) - Bayonne (Place des Gascons; 64100) - Niort (Espace Mendès France; 79000) - Châtellerault (26 rue Louis Blériot - BP 425; 86104) - Saint-Benoît (29, rue du Panier Vert; 86280) - Saint-Junien (Z.I. Les Martines; 87200) - Couzeix (Zac de Buxerolles; 87270) Occitania - Foix (Z.I Labarre rue Alse Labarre; 09000) - Pamiers (Route de Mirepoix; 09100) - Carcassonne (Lotissement des Romains - Rue de la Place; 11000) - Beaucaire (Corner RN 99/908 Chemin Communal du Clapas de Cornut; 30300) - Toulouse (41 av. Jean Moulin Quartier Empalot; 31400) - Vernet (3, Place Paul Muret; 31810) - Cazouls-lès-Beziers (ZAE Saint-Julien; 34370) - Beziers (Route de Bessan; 34500) - Balaruc-le-Vieux (C.C. Balaruc Loisirs - Lot n ° 26; 34540) - Cabestany (Mas Guerido - 6 Rue Gay Lussac; 66330) - Castres (152 rue Soeur Audenet; 81100) Pays de la Loire - Rezé (Rue Ernest Sauvestre; 44400) - Saint-Herblain (277, route de Vannes; 44800) - Ruaudin (La Lande du Camp; 72230) Provence-Alpes-Côte d'Azur - Marseille (12 Av. Des Poilus; 13013) - Marseille (11 bd de Paris - 5 rue de Forbin; 13002) - Gardanne (Avenue du Pont de Peton; 13120) - Fos-sur-Mer (C.C. Les Vallins; 13270) - Salon-de-Provence (Avenue de Wertheim; 13300) - Rognac (Lieu-dit de la Figuière; 13340) - Martigues (Corner Quai Alsace Lorraine / Bd Mongin - Imm. Le Rond-Point; 13500) - Forcalqueiret (Zac des Fontaines; 83136) - Hyères (Place Vicomtesse de Noailles; 83400) See here for more: https://www.lineaires.com/la-distribution/69-nouveaux-magasins-aldi-attendus-en-juin

Discount Retail Chain Lidl Polska (owned by the German Schwarz Gruppe) plans a double-digit increase in the range of products offered in the non-food category. For the 2021/2022 season, it will reach the chain's stores by 77%. more non-food items. From June, lidl-sklep.pl customers will be able to use the new delivery option, which is Paczkomat® InPost. InPost parcel lockers are located at over 700 Lidl stores throughout Poland. Such a large network as Lidl quickly develops the online sales segment, and Paczkomaty® InPost builds additional synergies in this area. We have been cooperating with the Lidl network for several years, we have already deployed over 700 InPost Parcel Lockers® at our stores, ”emphasizes Wojciech Kądziołka, InPost spokesman. The Lidl e-shop offers a wide range of products and accessories: from Esmara and Livergy clothes, through Florabest garden furniture, Lupilu and Playtive children's articles, to Parkside tools with a 3-year warranty. In the lidl-sklep.pl store, customers can pay by bank transfer, BLIK or card. For orders from PLN 199 (US$55), delivery is free, but regardless of the value of purchases, customers can take advantage of a free return. “With the comfort and satisfaction of our customers in mind, we are constantly working on the development of our online store. Every day we expand the range, we also develop new functionalities, incl. purchase without registration, BLIK payment, or easy ordering via the Lidl mobile application. Thanks to the delivery of orders from lidl-sklep.pl to Paczkomaty® InPost, shopping will become even more enjoyable, ”says Aleksandra Robaszkiewicz, Head of Corporate Communications and CSR Lidl Polska. The lidl-sklep.pl online store was launched in April 2019. At the beginning, there were about 500 articles. At present, the online offer includes over 2,000 products in eight categories: fashion, home, child, workshop and car, kitchen, sports and leisure, health and beauty, and garden. See here for more: https://www.dlahandlu.pl/e-commerce/wiadomosci/lidl-zakupy-z-e-sklepu-trafia-do-paczkomatow-inpost,98452.html

Discount Retail Chain Five Below (publicly listed NYSE: FIVE) said it will add Associate Assisted Self-Checkout (ACO) to be in over 60% of the value chain’s fleet by the end of this year. The discounter opened 67 net new stores and ended the first quarter of 2021 with 1,087 stores in 39 states, an increase in stores of 18% from the end of the first quarter of fiscal 2020. In addition to the new stores, Five Below remodeled about a dozen stores in Q1 into its new prototype and now expects to finish 2021 with about 30% of stores in the “five beyond” format, president and CEO Joel Anderson said. Additionally, ACO, as the retailer calls it, is in most of these remodeled stores, and the company is adding it to over 250 stores, to be in over 60% of the chain by the end of this year. “ACO allows our crew to move from behind the register to the floor to assist our customers with their shopping and checkout process, which makes for a better and faster customer experience,” said Anderson in the earnings call. “Five beyond and ACO are just two examples of how fast we are transforming the Five Below concept to make it an even better experience. For digital, which includes marketing, as well as e-commerce, we focused on increasing our brand awareness through more targeted marketing, utilizing paid search and social platforms such as Instagram. Through digital channels, we are able to highlight our amazing value, hot new products, and inspire and delight our customers.” The discounter also made significant progress in preparing its next two distribution centers to open, he noted. Five Below started inbound shipping to its Arizona DC, or ship center, and also broke ground on its Indianapolis ship center in mid-April. The Arizona ship center is expected to open later this summer and will include e-commerce fulfillment, which will improve service to customers in the western states. “These ship centers feature a new warehouse management system, which, combined with our demand forecasting platform, will help optimize our inventory levels and allocations,” said Anderson. Five Below reported net earnings of US$49.6 million in the quarter, compared to a loss of US$50.6 million in the year-ago period. “Our first quarter results kicked off a great start to fiscal 2021, surpassing our expectations. Our teams did an outstanding job executing in an environment of elevated consumer demand,” said Anderson. Five Below is on track to open 170 to 180 new stores this year. “We are excited to continue growing and innovating across our key strategic initiatives of product, experience and supply chain. With the inherent flexibility of our eight worlds, unique merchandising approach and focus on innovation, we believe we remain in a position of strength to continue growing Five Below and driving sustainable, long-term value for all stakeholders.” See here for more: https://risnews.com/five-below-adding-associate-assisted-self-checkout-250-stores?oly_enc_id=8775F0135745H1C&utm_source=omeda&utm_medium=email&utm_campaign=NL_RIS+Executive+Insight&utm_keyword=