European Grocery Retailing 2007

Verdict Research: European Grocery Retailing 2007 analyses the grocery market across 25 EU member states. The report explores the dynamics, growth trends and drivers of the market and provides detailed strategic recommendations for retailers. It also profiles and assesses the prospects for Europe's 10 top grocers including Ahold, Aldi, Carrefour and Tesco.

Report Highlights


For many years hypermarkets appeared invincible with their operating scale offering them unrivalled advantages over smaller formats. But now this dominance is being challenged by the expansion of hard discounters that have developed a highly profitable business model which offers convenience, quality and market leading prices to shoppers Carrefour's European market leadership is under threat. It must reform its hypermarket business to keep its lead over second placed Tesco. The UK retailer's EU sales have reached 80% of Carrefour's, and given its current rapid growth and proven ability to deliver on ambitious expansion plans has potential to overtake Carrefour within 10 years. The European grocery market grew by 2.2% to EUR864bn in 2006, a slightly better performance than 2005. While the mature core markets of western Europe showed slowing growth rates of 2.0% in 2006, less developed eastern markets grew by 4.7%.
[Fade out the market survey infos]

CHAPTER 1 EXECUTIVE SUMMARY 21
Key Findings 21
Main Conclusions 22
CHAPTER 2 EUROPEAN MARKET – ECONOMIC OVERVIEW 27
Key Findings 27
Key Messages 28
GDP 30
Consumer Expenditure 33
Inflation 36
Interest Rates 38
Employment 41
CHAPTER 3 EUROPEAN MARKET – DEMOGRAPHIC OVERVIEW 44
Key Findings 44
Key Messages 45
Trends 47
Growth by Country 48
Age Breakdown 50
Consequences for Retailers 53
Households 54
Urban Population 58
CHAPTER 4 EUROPEAN MARKET – RETAIL SPENDING 60
Expenditure 60
Retail Share 65
Spend by Country 67
Growth 71
Per Capita 73
CHAPTER 5 GROCERY RETAILING IN THE EU 76
Key Messages 76
Grocers Sales Summary 77
Grocers Space Summary 78
Grocers Store Numbers Summary 79
Grocers Sales 80
Grocers Space 89
Sales Densities 92
Grocers Store Numbers 95
Average Store Sizes 99
CHAPTER 6 GROCERY RETAILING IN FRANCE 101
Legislation 103
Recent Developments & Trends 104
Shares of Grocery Retailers in France 105
Outlook for Grocery Retailing in France 106
CHAPTER 7 GROCERY RETAILING IN GERMANY 107
Legislation 109
Recent Developments & Trends 110
Shares of Grocery Retailers in Germany 111
Outlook for Grocery Retailing in Germany 112
CHAPTER 8 GROCERY RETAILING IN ITALY 114
Recent Developments & Trends 115
Shares of Grocery Retailers in Italy 116
Outlook for Grocery Retailing in Italy 117
CHAPTER 9 GROCERY RETAILING IN THE NETHERLANDS 119
Recent Developments & Trends 120
Shares of Grocery Retailers in the Netherlands 122
Outlook for Grocery Retailing in the Netherlands 123
CHAPTER 10 GROCERY RETAILING IN SPAIN 124
Recent Developments & Trends 125
Shares of Grocery Retailers in Spain 126
Outlook for Grocery Retailing in Spain 128
CHAPTER 11 GROCERY RETAILING IN THE UK 129
Recent Developments & Trends 133
Shares of Grocery Retailers in the United Kingdom 134
Outlook for Grocery Retailing in the United Kingdom 135
CHAPTER 12 STRATEGIC ISSUES 137
Threats 137
Arrested Development of the Hypermarket 140
The Rise of the Discounters 144
Rising Energy and Fuel Prices 147
Opportunities 151
Green Retailing 152
Internationalisation 155
International Presence 157
Non-food & Private Label Development 159
Convenience Trend & Internet Retailing 161
Format Diversification 164
CHAPTER 13 COMPANY COMPARISONS 165
Overview 165
CHAPTER 14 AHOLD 169
Company Overview 169
Recent Key Developments 170
Sales Performance 172
Benchmarks 174
Store Portfolio 175
Outlook 177
CHAPTER 15 ALDI 178
Company Overview 178
Recent Key Developments 180
Sales Performance 182
Benchmarks 183
Store Portfolio 184
Outlook 186
CHAPTER 16 CARREFOUR 188
Company Overview 188
Recent Key Developments 190
Sales Performance 191
Benchmarks 193
Store Portfolio 194
Outlook 198
CHAPTER 17 E.LECLERC 201
Company Overview 201
Recent Key Developments 202
Sales Performance 203
Benchmarks 204
Store Portfolio 205
Outlook 206
CHAPTER 18 EDEKA 208
Company Overview 208
Recent Key Developments 209
Sales Performance 210
Benchmarks 211
Store Portfolio 212
Outlook 213
CHAPTER 19 GROUPE AUCHAN 215
Company Overview 215
Recent Key Developments 217
Sales Performance 218
Benchmarks 218
Store Portfolio 219
Outlook 221
CHAPTER 20 ITM ENTREPRISES 223
Company Overview 223
Recent Key Developments 224
Sales Performance 225
Benchmarks 225
Store Portfolio 226
Outlook 228
CHAPTER 21 REWE 230
Company Overview 230
Recent Key Developments 231
Sales Performance 232
Benchmarks 233
Store Portfolio 234
Outlook 236
CHAPTER 22 SCHWARZ GRUPPE 238
Company Overview 238
Recent Key Developments 239
Sales Performance 240
Benchmarks 241
Store Portfolio 242
Outlook 244
CHAPTER 23 TESCO 247
Company Overview 247
Recent Key Developments 249
Sales Performance 251
Benchmarks 253
Store Portfolio 253
Outlook 256
CHAPTER 24 APPENDIX 259
USD conversion tables 259
CHAPTER 25 GLOSSARY 269
Definitions 269
[Fade out table of contents]

Table 1: Consequences of population change for retailers 2005-2015 53
Table 2: EU retail expenditure 2000-05 60
Table 3: EU retail expenditure growth 2000-05 60
Table 4: Total retail spend per country – EU15 2000-05 67
Table 5: Total retail spend per country – 10 new member states 2000-05 69
Table 6: Total EU25 grocers market overview 2001 & 2006 76
Table 7: EU 15 grocers sales by country 2001-06 80
Table 8: EU 15 grocers sales growth rates by country 2000-06 81
Table 9: New member states grocers sales by country 2001-06 82
Table 10: New member states grocers sales growth rates by country 2001-06 83
Table 11: % share of EU25 grocers sales total by country 2001 & 2006 87
Table 12: EU Grocers selling space (m sq m) by country 2001-06 89
Table 13: EU Grocers selling space growth by country 2001-06 90
Table 14: % share of EU-25 grocers selling space total by country 2001 & 2006 91
Table 15: EU grocers store numbers by country 2001-06 95
Table 16: EU Grocers store numbers growth by country 2001-06 96
Table 17: % share of EU grocers store numbers by country 2001 & 2006 97
Table 18: France grocery retail snapshot 2001-06 101
Table 19: France % share of value sales by format 2001-06 102
Table 20: France % change in value sales by format 2001-06 102
Table 21: France grocery market share 2005 105
Table 22: Germany grocery retail snapshot 2001-06 107
Table 23: Germany % share of value sales by format 2000-05 108
Table 24: Germany % change in value sales by format 2000-05 108
Table 25: Germany grocery market share 2005 111
Table 26: Italy grocery retail snapshot 2001-06 114
Table 27: Italy grocery market share 2005 116
Table 28: The Netherlands grocery retail snapshot 2001-06 119
Table 29: The Netherlands grocery market share 2005 122
Table 30: Spain grocery retail snapshot 2001-06 124
Table 31: Spain grocery market share 2005 126
Table 32: UK grocery retail snapshot 2001-06 129
Table 33: UK % share of value sales by format 2001-06 130
Table 34: UK % change in value sales by format 2001-06 130
Table 35: UK grocery market share 2006 134
Table 36: Carrefour hypermarket benchmarks 2000-05 141
Table 37: Leading European grocers sales 2006 165
Table 38: Leading European grocers market shares 2006 166
Table 39: Leading European grocers sales densities 2005-06 167
Table 40: Ahold company overview 2006 169
Table 41: Ahold trading record 2000-06e 172
Table 42: Ahold gross profit 2004-05 172
Table 43: Ahold sales by division 2004-05 173
Table 44: Ahold benchmarks 2005-06e 174
Table 45: Ahold store portfolio 2005 175
Table 46: Ahold store portfolio change 2004-05 175
Table 47: Ahold JV and Associates store portfolio 2005 175
Table 48: Ahold JV and Associates store change 2004-05 176
Table 49: Ahold selling space development 2004-05 176
Table 50: Aldi company overview 2006 178
Table 51: Aldi trading record 2000-06e 182
Table 52: Aldi benchmarks 2005-06e 183
Table 53: Aldi store estate 2005 184
Table 54: Aldi store portfolio and selling space 2004-05 185
Table 55: Carrefour company overview 2006 188
Table 56: Carrefour turnover 2000-2006e 191
Table 57: Carrefour sales incl VAT by region and format 2005 192
Table 58: Carrefour benchmarks 2005-06e 193
Table 59: Carrefour hypermarket benchmarks 2005-05 193
Table 60: Carrefour store portfolio 2005 194
Table 61: Carrefour selling space development by country 2005 196
Table 62: Carrefour selling space development by format 2000-05 197
Table 63: E.Leclerc company overview 2006 201
Table 64: E.Leclerc trading record 2000-06e 203
Table 65: E.Leclerc benchmarks 2005-06e 204
Table 66: E.Leclerc store portfolio 2004-05 205
Table 67: E.Leclerc space provision 2004-05 206
Table 68: Edeka company overview 2006 208
Table 69: Edeka turnover record 2000-06e 210
Table 70: Edeka benchmarks 2005-06e 211
Table 71: Edeka store portfolio 2005 212
Table 72: Edeka outlets, selling space development 2001-2005 212
Table 73: Groupe Auchan company overview 2006 215
Table 74: Groupe Auchan trading record 2000–06e 218
Table 75: Groupe Auchan benchmarks 2005-06e 219
Table 76: Groupe Auchan hypermarket store portfolio 2004-05 219
Table 77: Groupe Auchan supermarket store portfolio 2004-05 220
Table 78: Groupe Auchan store estate and selling space 2004-05 221
Table 79: ITM Entreprises company overview 2006 223
Table 80: ITM Entreprises trading record 2000-06e 225
Table 81: ITM Entreprises benchmarks 2005-06e 225
Table 82: ITM Entreprises store portfolio 2004-05 226
Table 83: ITM Entreprises selling space development 2004-05 227
Table 84: Rewe company overview 2006 230
Table 85: Rewe trading record 2000-06e 232
Table 86: Rewe turnover by format 2004-05 232
Table 87: Rewe benchmarks 2005-06e 233
Table 88: Rewe store portfolio 2004-05 234
Table 89: Rewe store estate and selling space 2004-05 235
Table 90: Schwarz Gruppe company overview 2006 238
Table 91: Schwarz Gruppe estimated trading record 2000-06e 240
Table 92: Schwarz Gruppe benchmarks 2005-06e 241
Table 93: Schwarz Gruppe store portfolio 2005 242
Table 94: Schwarz Gruppe store estate and selling space 2004 - 2005 244
Table 95: Tesco company overview 2006 247
Table 96: Tesco trading record 2001-07e 251
Table 97: Tesco Continental European turnover 2001-06 252
Table 98: Tesco operating profit and margin 2002-06 252
Table 99: Tesco benchmarks 2005/06 & 2006/07 253
Table 100: Tesco store portfolio 2001-06 254
LIST OF FIGURES

LIail spend per country – EU15 2000-05 260
Table 104: Total retail spend per country – 10 new member states 2000 & 2005 261
Table 105: EU 15 grocers sales by country 2001-06 262
Table 106: New member states grocers sales by country 2001-06 263
Table 107: Leading European grocers sales 2006 266
Table 108: Leading European grocers market shares 2006 267
Table 109: Leading European grocers sales densities 2005-06 268




Figure 1: GDP: Top 10 countries in European Union 2005 30
Figure 2: GDP growth forecast of Top 10 EU countries 2006 & 2007e 30
Figure 3: GDP: Other 15 countries in European Union (€50bn+) 2005 31
Figure 4: GDP: Other 15 countries in European Union (€50bn-) 2005 31
Figure 5: GDP growth forecast of other 15 European Union countries (4.5%+) 2006 & 2007 32
Figure 6: GDP growth forecast of other 15 European Union countries (4.5%-) 2006 & 2007 32
Figure 7: Consumer expenditure of Top 10 European Union countries 2005 33
Figure 8: Consumer expenditure forecast growth of Top 10 European Union countries year-on-year 2006 & 2007e 33
Figure 9: Consumer expenditure: Other 15 countries in European Union (€35bn+) 2005 34
Figure 10: Consumer expenditure: Other 15 countries in European Union (€35bn-) 2005 34
Figure 11: Expenditure forecast growth of other 15 European Union countries year-on-year (6.0%+) 2006 & 2007e 35
Figure 12: Expenditure forecast growth of other 15 European Union countries year-on-year (6.0%-) 2006 & 2007e 35
Figure 13: Harmonised Index of Consumer Prices – growth of Top 10 EU countries 2004 & 2005 36
Figure 14: Harmonised Index of Consumer Prices – growth of other 15 EU countries (2.6%+) 2004 & 2005 36
Figure 15: Harmonised Index of Consumer Prices – growth of other 15 EU countries (2.6%-) 2004 & 2005 37
Figure 16: Central bank interest rates, official lending rates 2005 38
Figure 17: ECB interest rates 2000-06 39
Figure 18: BoE interest rates 2001-06 40
Figure 19: Total unemployment rates of Top 10 EU countries 2000 & 2005 41
Figure 20: Total unemployment rates of other 15 EU countries (7.7%+) 2000 & 2005 42
Figure 21: Total unemployment rates of other 15 EU countries (7.7%-) 2000 & 2005 42
Figure 22: EU population totals (000s) by country 2005 46
Figure 23: Five year trends in total EU population growth 2000-2020e 47
Figure 24: Forecast population growth (%) for the Top 10 countries in EU by GDP – 2015 on 2005 48
Figure 25: Forecast population growth (%) for other EU countries 2015 on 2005 49
Figure 26: Historical changes in EU age breakdown 2005e on 1995 50
Figure 27: Forecast changes in EU age breakdown 2015e on 2005e 50
Figure 28: Comparison of EU age groups 2005e & 2015e 52
Figure 29: Top 10 EU countries by GDP – household numbers 2005 54
Figure 30: Other EU countries household numbers 2005 55
Figure 31: Top 10 EU countries by GDP – average household size in 2005 56
Figure 32: Other EU countries average household size in 2005 57
Figure 33: Comparison of EU countries by urban population % – Top 10 EU countries by GDP – 2006 58
Figure 34: Comparison of EU countries by urban population % – Other EU countries – 2006 59
Figure 35: Top Six EU member states retail growth % 2000-05 62
Figure 36: EU-15 retail spend and change % 2000-05 62
Figure 37: New member states spend and change % 2000-05 63
Figure 38: EU25 retail spend and change % 2000-05 64
Figure 39: EU retail spend as % of total consumer expenditure 2000 & 2005 65
Figure 40: Growth in EU retail spend by country 2005 on 2004 71
Figure 41: EU per capita retail spend 2000-05 73
Figure 42: EU15 per capita retail spend by country 2005 74
Figure 43: New member states per capita retail spend by country 2005 75
Figure 44: Share of EU grocers sales by leading country 2006 77
Figure 45: Share of EU grocers selling space by leading country 2006 78
Figure 46: Share of EU grocers stores by leading country 2006 79
Figure 47: New member states grocers sales by country 2006 84
Figure 48: EU15 grocers expenditure per capita 2005 85
Figure 49: New member states grocers expenditure per capita 2005 86
Figure 50: EU grocers sales 5 year growth rates by country 2001-06 88
Figure 51: EU 15 grocers sales densities (€ per sq m) 2006 92
Figure 52: New member states grocers densities (€/sq m) 2006 93
Figure 53: % Change in grocers sales densities EU 2006 on 2001 94
Figure 54: Grocers store numbers of new member states 2006 98
Figure 55: EU 15 grocers average store size (sq m) 2006 99
Figure 56: New member states grocers average store size (sq m) 2006 100
Figure 57: Threats facing grocers 2007 137
Figure 58: Carrefour hypermarket sales densities 1996-2005 140
Figure 59: Carrefour hypermarket sales per store 1996-2005 140
Figure 60: Carrefour hypermarket selling space 1996-2005 141
Figure 61: Success factors for Aldi 2006 144
Figure 62: Rising energy and fuel prices – direct impact on grocers 2007 147
Figure 63: Rising energy and fuel prices – indirect impact on grocers 2007 148
Figure 64: Rising energy and fuel prices – opportunity for grocers 2007 149
Figure 65: Growth opportunities for grocers 2007 151
Figure 66: EU presence by country and grocer 2006 157
Figure 67: Household number growth and drivers 2006 161
Figure 68: EU 15 grocers sales densities 2006 264
Figure 69: New member states grocers densities 2006 265
[Fade out list of tables / figures]