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GFK - Desk Research FMCG Distribution Channels - Romania
GFK - Desk Research FMCG Distribution Channels - Romania
Content
2
Content – PART 3
3
Content – PART 3
4
Content – PART 3
5
Unemployment, % 7.2
N= N= N= N= N= N=
21,623,849 11,879,897 9,743,952 21,623,849 11,879,897 9,743,952
9,3 7,4
12,6
8,1
9,6
47,9 11,2
48,8 49,8 13,8
12,8
11,4
12,8 14,8
10,4
13,6 13,8
13,4
Total country Urban Rural environment
environment
10,0 8,7 11,6
Women Men
Total country Urban environment Rural environment
Municipalities
Total 314 100,0 11,879,897 100,0
Less than 3,000 inh. 5 1,6 12,848 0,1
3,000 – 4,999 inh. 15 4,8 63,392 0,5
5,000 – 9,999 inh. 96 30,6 709,031 6,0
10,000 – 19,999 inh. 93 29,6 1,252,321 10,5
20,000 – 49,999 inh. 59 18,8 1,789,788 15,1
50,000 – 99,999 inh. 21 6,7 1,490,022 12,6
100,000 – 199,999 inh. 14 4,4 1,870,262 15,7
200,000 – 999,999 inh. 10 3,2 2,767,274 23,3
1,000,000 and more inh. 1 0,3 1,924,959 16,2
Communes
Total 2,850 100,0 9,743,952 100,0
Less than 1,000 66 2,3 48,908 0,5
1,000 – 1,999 554 19,4 877,763 9,0
2,000 – 4,999 1766 62,0 5,725,172 58,7
5,000 – 9,999 443 15,6 2,852,876 29,3
10,000 and more 21 0,7 239,233 2,5
POPULATION STRUCTURE
Romania – Population by counties (2004 census) Population
(inh.)
11
Cities
more than 200 th. inh.
Source:
Source: GfK
National RegioGraph
Institute of Statistics - Romania;
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
5,7
5,1 5,2
4,1
2,1
30,3
17,8
14,1
9,3 8,6
Unemployment rate
%
8,4 8,0
6,9 7,0 7,2
6,4
EU 25 1,7 EU 25 100
EU 15 1,5 EU 15 108
* The volume index of GDP per capita in Purchasing Power Standards (PPS) is expressed in relation to the European Union (EU
25)
average set to equal 100. PPS is a common currency that eliminates the differences in price levels between countries.
EU 25 2,2 EU 25 8,8
EU 15 2,1 EU 15 7,9
69
67 66
62
58
50 50
47 44 42 40 41
32
29 27 26
22 22 21 22
98 100
Germany = 100
90
77 75 74
70
65
57 56
52 49 47 45 46
36
33
30 29
24 25 24 25
PERSONAL CONSUMPTION
18
Average annual personal consumption per household,
%
46 44
49 Clothing and footwear
PERSONAL CONSUMPTION
19
2005/2004
real growth rate
Alcoholic
-1,7 drinks and tobacco
-1,7 financing essential needs still takes most of the
budget;
Clothing
-1,6 and footwear -1,6
food and beverages expenses are in decline, but
Housing and energy6,1
* 6,1 still
cover more than 40% of the household budget;
Furniture, equipement and maintenance
10 10 10
Young, still studying
8 9 9
5 5 Young singles
10
9 9
8 Young couples without children
6 6 5
Small families with small children
16 15 12
Large families with small children
7 4
6
10 Small families with school children
8 8
746
599
484
379
302
214
40,5 41,2
25,5 27,7
24,5
23,7
746 735
AVERAGE
Romania – NET WAGES
Incomes per BY SELECTED SECTORS Counties/ Avg. income
Euro per capita/ yearly
capita
23
Cities
despite positive trends in other fields, Romania has faced a high inflation rate level, decreasing though,
comparing to
2004;
the inflation target proposed by the Government and the National Bank for 2007 is 5% (+/- 1),
considered as
hard to achieve by the FMI representatives;
in 2005 GDP increased with a slower pace (4,1%) compared to 2004 (8,4%);
compared to Slovenia, Czech Republic and Hungary, Romania records considerable gaps, but the
analysts are
optimistic, estimating that these gaps can be diminished , considering that Romania recorded the
fastest growth in
GDP among UE members between 2000-2006;
compared to EU average level, Romania has a good position regarding unemployment rate;
in 2005 industrial production growth rate was 2%, while the exports covered 68% of the imports;
comparing the purchasing power in Europe by taking Austria as reference (100%), Romanian level
reaches 29%,
behind Russia (32%), but ahead of Bulgaria (27%) and Turkey (26%);
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
MACROECONOMIC SITUATION IN ROMANIA – AN
OVERVIEW
25
analyzing household structure by family life cycle, we can notice that older families without children
(employed or
unemployed) are dominant (43% in 2006) – with an upward trend compared to 2005 (39%);
from one year to another, the percentage of families with school children decreased (from 23% in 2004
to 16% in
2006);
overall net wages have risen continuously, but beginning with 2002 the growth rhythm has slowed
down;
the average number of employees in industry sector decreased compared to previous years, while for
commerce the
percentage slightly increased.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Source: own calculation according to Census 2002; National Institute of Statistics; GfK Desk Research – March 2007
* Carrefour, Cora, Trident, Pic, Real, Interex, Spar, Kaufland, Metro C&C, Selgros C&C, Profi, Plus, Penny Market, MiniMax Discount, Hard-Discount,
Billa, Gima, Artima, Angst, Primavara, Cris-Tim, Fidelio, Mega Image, Albinuta, La Fourmi
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
28
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Bucharest concentrates more than a quarter of the total number of major accounts* in Romania,
for Muntenia, Dobrogea; Oltenia and Moldova the number of outlets is low, compared to the
retailers are well represented in counties like Prahova, Timis, Brasov, Constanta and Hunedoara,
the most valuable companies in 2005 come from areas of economic activities like Energy, Financial
Petrom is on top, evaluated in 2005 at 8.977 million Euro, followed by BCR, Orange, Vodafone and
BRD;
among FMCG companies, the most valuable in 2005 were Coca-Cola HBC, Procter & Gamble, British
American Tabacao, Brau Union and Philip Morris, while among retailers, Metro Cash & Carry was the
leader, by far.
* Carrefour, Cora, Trident, Pic, Real, Interex, Spar, Kaufland, Metro C&C, Selgros C&C, Profi, Plus, Penny Market, MiniMax Discount, Hard-Discount, Billa, Gima, Artima,
Angst, Primavara, Cris-Tim, Fidelio, Mega Image, Albinuta, La Fourmi
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
3.1
Cash & carries 908 1.149 1.542 1.880 2.313 2.590 2.928 3.198 3.505 3.851
Discount stores 41 65 94 175 540 779 1.100 1.445 1.742 2.038
Forecourt stores 35 48 97 107 113 126 138 141 146 149
Hypermarkets 100 153 365 620 1.201 2.273 3.480 4.636 5.724 6.856
Supermarkets 137 208 325 866 923 1.039 1.241 1.452 1.627 1.808
Other stores 8.990 9.151 10.718 11.925 12.945 15.249 15.837 16.180 16.585 16.058
Total 10.211 10.774 13.141 15.573 18.035 22.056 24.724 27.052 29.329 30.760
Cash & Carry: membership-based wholesale format intended for resellers and commercial customers. In the food retail sector, usually a source for independent shop
operators. Customers serve themselves as in a supermarket and pay for their merchandise at the checkout (unlike delivered wholesale, where merchandise is brought
to the customer). In some countries, cash & carry outlets also sell to private consumers, e.g. in some Eastern European states.
Discount Store: large format (2,500 square metres-plus) general merchandise superstore that carries a wide assortment of non-foods, general merchandise, health
& beauty products and groceries. Stores typically have a strong focus on low prices. Grocery accounts for around 30-40% of the range.
Forecourt Store: convenience outlet located at a petrol station. Occasionally operated in a joint venture between an oil company and a grocery retailer.
Hypermarket: self-service store with a sales area of more than 5,000 square metres and generating high turnover, offering both a comprehensive food range and a
wide choice of non-food items. Depending on the individual operation, the non-food offer can be as deep and wide as in a department store.
Supermarket: self-service store with a grocery product offer, ranging from 400 to 2,500 square metres.
Depending on individual store sizes, there are also non-food items available.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
MARKET SHARE BY TYPE OF OUTLETS %
35
Source: Planet Retail
Other stores
52
60 57
64 Supermarkets
72 69
77
85 82
88
Hypermarkets
6
6
5 Forecourt stores
5
22
5 20
5 17
14
6 10 Discount stores
7
3 4 7
2 3 3 4 4 5 6
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Evolution of
number of stores 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
(modern retail)
•The distance between modern retail and the traditional one could widen in the following years in favor of the large
stores due to the extension plans of the international commerce networks as well as to the consumers’ behavior
changing habits.
•The transformations of the modern retail foreseen for the following 4-5 years represent the greatest opportunity for the
distribution companies.
•The first years after the integration in EU will bring a growth of the FMCG consumption and of the dealers’ businesses
based on the emergence of new brands and stores networks but also on the living standards.
•In Bucharest can be noticed that the market tends to become impenetrable due to the fact that the proper spaces for a
retail activity are hard to find and, if in case of the large surfaces they have already been secured, the neighborhood
stores and the supermarkets have low chances to enter on the market. A solution for this problem can be represented by
the purchasing of the competitors and it will surely be used more and more often from now on.
•Faster or slower, all the international traders extend by opening new stores using Greenfield investments. A real
competition in Romania will exist in the moment when it will be possible to extend or to enter on a market by making an
acquisition.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Market Share
Retail Banner 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Sales %
Auchan 0,0 0,0 0,0 0,0 0,1 0,3 0,6 0,7 0,8 0,9
Caprabo 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0
Carrefour 1,0 1,2 2,0 2,8 3,4 4,0 5,3 6,5 7,3 8,1
CBA 0,0 0,0 0,0 3,1 2,9 2,6 2,6 2,5 2,5 2,6
Delhaize Group 0,4 0,5 0,4 0,4 0,5 0,5 0,6 0,6 0,7 0,7
Gima 0,2 0,2 0,3 0,2 0,0 0,0 0,0 0,0 0,0 0,0
ITM (Intermarché) 0,1 0,1 0,1 0,2 0,2 0,2 0,3 0,3 0,3 0,3
Louis Delhaize 0,1 0,8 1,1 1,4 1,6 2,3 3,1 3,8 4,3 4,9
Lukoil 0,1 0,2 0,2 0,2 0,2 0,2 0,1 0,1 0,1 0,1
Maxima 0,0 0,0 0,0 0,0 0,1 0,1 0,0 0,0 0,0 0,0
Metro Group 7,3 8,4 9,4 9,5 9,9 9,6 10,0 10,4 10,9 11,7
MOL 0,0 0,0 0,1 0,1 0,1 0,1 0,0 0,0 0,0 0,0
OMV 0,1 0,2 0,4 0,4 0,4 0,3 0,3 0,3 0,3 0,3
Rewe 2,5 3,6 4,0 4,6 6,9 7,1 8,3 9,0 9,4 10,2
Schwarz Group 0,0 0,0 0,0 0,1 1,4 2,6 3,5 4,2 4,8 5,5
Shell 0,1 0,1 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0
Tengelmann 0,0 0,0 0,0 0,2 0,5 0,9 1,2 1,6 1,9 2,2
Univers'all 0,1 0,2 0,2 0,2 0,1 0,0 0,0 0,0 0,0 0,0
Others 88,0 84,9 81,6 76,6 71,8 69,1 64,1 59,8 56,6 52,2
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
SWOT CARREFOUR
38
Strengths Weaknesses
Number 3 on the market but without competition
Given the potential of the market, opening 20
in hypermarkets
hypermarkets doesn’t seem to be overtly ambitious
The 1st hypermarket in Romania exceed 3 times the
original sales projection No intention to introduce discount stores
Due to the increasing sales is the biggest hypermarket
Introducing Carrefour's global multi-banner
operator on the Romanian market strategy seems out of reach
Pioneer with hypermarkets in Romania
The Romanian market is characterized by
A network of up to 40 stores within a couple of years in
modest profit margins and tightening competition
capital and all cities >200000 inhabitants
Has brought modern retailing to Romania
Excellent local sourcing
Has built a network of reliable suppliers from zero
Romania’s GDP has been growing by between 4 to 5% Tightening competition can cut down
annually since 2001 Carrefour’s profit.
After Poland, Romania is the second largest market Carrefour’s current monopoly is threatened
in Central Europe by new and aggressive hypermarket competition
Hyparlo and Carrefour share their investments 50:50. (Cora and Kaufland)
Revenues from the sale of Hyparlo’s Italian supermarkets
Substantial investments
can be reinvested in Romania. – UDS 25 to 30 million for a hypermarket in the capital
Following its divestment of Italy, Hyparlo can fully – USD 20 million outside
concentrate on Romania, now its only foreign
investment.
Opportunities Threats
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
CARREFOUR
39
Corporate mission 20007
Planning to open at least three shops per year, Carrefour has as final goal to operate at least one
store in every town exceeding 150,000 inhabitants. On the background of an increasing competition at
the country level, the retailer tries to be the first to arrive on the hypermarket segment in major cities
outside Bucharest.
Carrefour investments in the country in 2007 will exceed EUR280 million(USD371 million) while the
predicted sales reach EUR 700 million(USD892.2 million) backed by network expansion.
In 2007, Carrefour will continue its strategy of securing the best quality-price ratio along with the
discount policy.
Developments
Carrefour is accelerating its expansion in the country with an extra EURO60 million (USD 79.1 million)
to its budget to support the extension of the hypermarket network in 2008. The five outlets intended to
built and to become operative by the end of 2008 are to be located in the Romanian cities of Bucharest,
Oradea, Arad, Suceava and Pitesti.
In 2007 are planned to be opened 4 hypermarkets : 1 in Bucharest( Unirea Square) and 3 in the
country (1 in Cluj-Napoca and 2 in Iasi).
There are approximately 55,000 products listed in the Carrefour hypermarkets (with 70% to 90% of
local origin) and after the country’s integration in EU this number will reach 60,000 products, “mainly
due to the imported products”.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
REWE
40
Ownership & Concept
SC Billa and SC Rewe in Romania are owned by Rewe Group via its Austrian Eurobilla
subsidiary.
Rewe is present in Romania by Billa Supermarkets, by its Penny (including XXL) discounters
and by Selgros cash&carries.
Billa is a modern-style supermarket with large sections for fresh food. Extensive selections are
provided on customer service counters for meat and cheese. There are about 7,500 articles.
Penny is a discounter with about 1,200 label products, selected branded products and a fresh
meat/ vegetable self-service area.There is a good range of non-food articles including household
appliances.
Renamed in January 2007 Penny Market XXL, the discounter has 2500 articles on sale and is
based on a price competitive philosophy but with extensive fresh food sections.
Selgros is a cash & carry with a large food and non-food store design. Articles range in the
economy to premium price range. The stores are officially accessible only to business wholesales
customers but in fact are used by private shoppers as well. It is likely that these form the main
client base so Selgros does compete with hypermarkets in Romania.
The cash & carries mainly sell domestically produced food, simply for supply chain reasons and
because they need to be price competitive.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
REWE
41
Developments
Rewe intends to open further stores, both under its Billa and Selgros banners.
In 2007 Rewe’s cash & carry chain Selgros will open three stores located in the Eastern part of
the country (in Suceava, Iasi and Galati).
Rewe’s local supermarket operation Billa plans to open between 8 and 10 new stores this year
in cities from northwestern Romania and southern Romania and expand its network in the
country to 30 units by the end of 2007.
Rewe’s Penny discount store banner will see significant investments and a fast extension after
the first Penny outlets were opened in 2005 and its XXL Mega Discount were rebranded under
Penny XXL stores in early 2007.
Rewe intends to build 30 Penny stores in Romania by the end of the year.
The Billa supermarket chain is to accelerate expansion in the country where it plans to
establish a network of between 150 and 200 stores over the next 10 to 15 years.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
SWOT REWE
42
Strengths Weaknesses
Even though the XXL Mega Discount stores have
Second largest retailer in the market, with three
an attractive low cost concept, their size limits
different formats established
their locations to the periphery of towns.
Substantial lead ahead of its international rivals.
Billa supermarkets are confined to more affluent
city area, of which there are not many
Billa supermarkets have a good position in their
at the present time.
city centre location, leaving them plenty of
opportunities to expand once the economy Slow growth in cash & carry sector
develops further compared to Metro.
Opportunities Threats
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
DELHAIZE GROUP
43
Ownership & Concept
Delhaize is present in Romania through its fully-owned Mega Image operation, which is started
buying in May 2000.
Supermarkets heavily based in the Bucharest area (although there are also one store each in
Ploiesti and Constanta), with a strong focus on fresh produce.
In terms of pricing, Mega Image benefits from the fact that it is the market leader in the
capital.
Some recently-opened stores have been much larger than the older units, featuring roughly
2,000 square meters per outlet. In these larger outlets, the non-food offer is playing a more
prominent role than previously , including items such as cosmetics ranges and children’s
products.
Developments
The Mega Image plans to expand to a total of 24 stores by the end of 2007 through
investments worth around EUR1 million for each newly opened store.
The company is planning to open 6 supermarkets this year, including three or four in
Bucharest.
The retailer stated its strategy of starting on an investment drive to open stores outside
the capital.
Mega Image remains well placed to maintain a market-leading position in the supermarket
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Strengths Weaknesses
Market leader in Bucharest; expansion into
further cities under way. Currently limited growth potential as local
incomes are low.
There are few competing modern groceries chains.
Small network = limited buying power.
Good reputation for quality and store design
appealing to the wealthy. Increasing presence of the Western European
retailers.
Dual format strategy to appeal to different
Slow progress in expansion of its networks.
customer types.
Opportunities Threats
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
3.1.1
18 21 20 21
26
30 32 31 31 32
Selgros
82 79 80 79
74 70 68 69 69 68
Metro
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
€ 908 1,149 1,542 1,880 2,313 2,590 2,928 3,198 3,505 3,851
mn
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
35 33
31
29
30
27
25
25 23 23 23
21 21
19 19
20 18
17
15
15 13
11
10
7
5
4
5
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Metro Selgros
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
27 26
31
40
44 47
48 48 48 49
Selgros
72 73
68
60 56
52 52 53 52 51
Metro
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total
sales
165,850 208,850 246,850 305,000 327,000 387,000 414,000 441,000 479,000 517,000
area
(sq.m.)
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
www.metro.ro
www.selgros.ro
3.1.2
– HYPERMARKETS –
16 Kaufland
21 25 24 25
27 25 25
28
8 3 4 4 4 4
Auchan
14 14 14 14 14
19
100 19 20
20 20 20 Real
84
73 70
50 Cora
39 38 38 37 37
Carrefour
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
€ 100 153 365 620 1,201 2,273 3,480 4,636 5,724 6,856
mn
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
30
ACTUAL FIGURES 80 FORECAST
70
70
25
60
60
20 50
50
18
40
15 40
33
30
28
30
10 23 24
7 21
18 18
20
5 8 15 14
4 12
5 13 10
3 8
2 2 10 10 13
1 1 1 3 6 11
1 9
7
0 0 5
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
I will now show you some cards with diseases and I will ask you to order them by how serious you think they are.
One answer only, prompted.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
19 Kaufland
31 34 31 31 31 31 31
46
Real
34
23 23 24 24 24
26
100
Cora
17 17 16 16 16
69 16
54
47 15 Carrefour
17 16 16 15
20
14 13 13 13 13
5 Auchan
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total
sales 972,74 1,168,86 1,364,99
8,700 34,900 51,539 93,538 310,156 573,080 776,620
area 4 8 2
(sq.m.)
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
www.carrefour.ro
www.cora.ro
www.kaufland.ro
part of Germany’s Lidl & Schwarz Group; present in Romanian market since 2005
has 23 hypermarkets in present, after an investment of 30 million Euro
employed about 4.700 people
intend to have 50 hypermarkets on local market until 2008
private labels: Soft Maximo, Grand Maximo, Clean Maximo, Aile, Amelia, Vitae D’Oro, Stilla, Benita, Mammita, Katy,
Classic Caterine, Classic Grande, Vita Star.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
3.1.3
– SUPERMARKETS –
11 CBA Super
17 14
9
9 Gamma
7 4 47 46 44
5 5 51
56 57 56
Delvita City
25 18
26
6 Gima
5 6 Superstore
5 13
3 1 12 12 Univers'all
2 5
4 4 11
4 10
9
8 InterEx
51 54
44
36 37 38
32 Mega-Image
25 27 28
Billa
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
€ 137 208 325 866 923 1,039 1,241 1,452 1,627 1,808
mn
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
CBA Super
Univers'all
63 62 60 Billa
65 65
72 72 73 71
76
InterEx
Gima
Superstore
4
5 23 24 Delvita City
5 22 22
17 4 15
15
13 11 14
Mega-
3 8 8 9 9
7 7 Image
3 5
8 6 4 6 6 6 7 7
4 5
Gamma
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total
sales 187,65 264,00 313,00 434,72 470,42 506,12
123,963 312,164 342,976 399,020
area 0 0 8 0 0 0
(sq.m.)
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
part of Germany’s Rewe Group is the first international retail network that entered the local market in 1999
has 22 supermarkets in all country
almost 2.000 employees
more than 80% of Billa products are coming from the local market
private label: Clever
ranked as one of the top companies in the Romanian trade sector with a turnover of 250.4 mil Euro in 2005
8-10 new stores will be opened this year, starting with Medias, Giurgiu, Bucharest – Henri Coanda Airport
3.1.4
– DISCOUNT STORES –
0 0 2 3 3 2 0 0 0 0
8 7 6 6
9 8
Albinuta
27
24 21 19
37 24 22
39 26
31
Profi
32 34
35 28
24
17
Penny XXL
73
63
59
20
Plus
40 40 41 42 41 41
17
Penny
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
70 180
180
64
60 160
150
140
50
120 120
40 40
34 100
35 90 80
30
30
26 80 70
24 62
21 26 60 50
20 18 65
15 58
54
16 40
48
10 10 5
4 4 5 7 20 9 10 11 12
8
2 6
0 0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Plus
27
35 34
47 50 49 51 55 58 59 Penny
21 XXL
12
15
16 Penny
17 13
13
11
11 10
9 17
53 21 18
50 50 18 Albinuta
17 16
27
17 21 18 16 15 14
Profi
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total
sales
area 15,000 24,000 33,900 72,306 121,600156,050210,900263,700311,900364,000
(sq.m.)
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
www.pennyromania.ro
part of Germany’s Rewe Group; opened in Romania first discount store in 2005
counts 39 outlets: 34 Penny Market and 5 XXL Mega Discount
starting with January 2007 - XXL Mega Discount became Penny Market XXL
the discounter have 2 format stores: classic one - 750 m² area with more than 1,200 products and the big size one of
around
2500 m² and with around 3500 food/non food products
private labels: Boni, Top Floris
www.plus-discount.ro
3.1.5
– FORECOURT STORES –
5 3 3 3 3 3 3 3
13 10 11 10 9 9 9 9
23 7 Select
4
10
27 27 26 27 27 28
9 27 27
Ciao Agip
14
35
MOL
29
59 60 59 60 62 62 60 60
Lukoil
38
26
Viva Shop
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
680
645
592 665 660 655 650
600
530
500
400
350 360
330 340 370
310 320
300
300
191
200
187 137
91 120 115 113 110 108
81 77 105
100 81
50
48 52 58 26 28 30 32 34
24 36
23 23 24
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
I will now show you some cards with diseases and I will ask you to order them by how serious you think they are.
One answer only, prompted.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
FORECOURT STORES - RETAIL STRUCTURE BY SALES AREA
(sq.m.)
68
Source: Planet Retail
4
13
Select
24
57 53 57 56 56
36 59 58
19 Viva Shop
60
14
8 MOL
10 8 7
11 8 8 8
5
36 40 Lukoil
32 35 31 32 33 34 35
29
7 4 2 2 2 2 2 2 2 3 Ciao Agip
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total
sales 13,49
25,904 56,560 51,820 49,620 56,790 57,080 57,330 57,620 57,780
area 4
(sq.m.)
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Billa, Carrefour, Penny Market/XXL Mega Discount, Cora and Kaufland improved their value shares,
while the other accounts were stable;
with 19% value share for major accounts, Romania is placed as a still young market in terms of
concentration, together with countries like Bulgaria (15%), Serbia (28%), Bosnia & Herzegovina (29%);
most concetrated markets are Slovakia (71%), Czech Republic (62%), Croatia (61%) and Hungary
(60%);
at the opposite side are countries like Russia (7% ) and Ukraine (9%);
among the most important retailers, Metro and Selgros have the most dynamic activity in FMCG
promotion leaflets;
with 23 outlets at the end of March 2007, Kaufland plans the next opening on April 19th in Constanta,
followed by another new outlet in Roman on April 26th;
Carrefour plans to open 4 new outlets in 2007 (1 in Bucharest – Piata Unirii, 2 in Iasi, 1 in Cluj-Napoca)
, having by the end of the year a total of 11 outlets and intends 5 new openings in 2008 (Pitesti,
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
3.2
Supermarket: store with food and non-food products, mainly self-service and minimum two check-outs.
Include Key Accounts Supermarkets (La Fourmi, Mega Image, Billa, G’ Market, Angst, Amtima,
Univers’all, Spar, etc.) and supermarkets which are not part of a chain.
Hypermarket: Carrefour, Cora, Interex, Kaufland, Pic, Real, Spar, Trident, Auchan.
Discounters: modern shops with small prices for food and non food products: XXL Mega Discount, Profi, Plus,
MiniMax Discount and Penny Market.
Cash & Carry: include Metro C&C, Selgros C&C and Gamma C&C.
Boutique: traditional shops, which you can enter and find food and non-food products. Generally these
are rather small shops that you can very easily find on the ground floor of the blocks in urban area
and are very popular in the rural area as well – where people dedicate one room of their house to a small
shop where they sell different assortments of food and non-food stuff.
Kiosks: small shops which you can not enter, but you can find a variety of products. The service is
done through the small window, specific for this type of store.
Agro & Food Store: traditional over-the-counter shops for food, but you can buy also products for
personal and household care. These are basically the old “Alimentara” stores.
Street Vendors: include also market hall and open market vendors (open spaces for trade, especially for food
products).
Other Shops specialized stores: cosmetics shops, beverages shops; gas stations; drugstores; “Economat”
stores; bought from abroad etc.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
OUTLET TYPES – MARKET SHARES & PURCHASING
STRUCTURE
72
Share of outlet types, value %
Supermarkets
8 11 13
Hypermarkets 16 16
7 1
1 2
7 1 4
Discounters 13 7 2 8
12 7 4
Cash&Carry/ Wholesalers 12 6
11
Agro&Food 10
Boutiques 44
43 43
Kiosks 43 41
General Stores 3
6 3 2
Street vendors 6 6 2
9 7 5 1
4
6
Others 10 5 4
9 8 5 6
2002 2003 2004 2005 2006
value per
frequency of
Period: 2006 value share, % penetration % purchase act,
purchase
RON
Total Romania 100,0 100 209.6 7.0
12 11 14 15
20 20 19 18 17 17 18
23 3 7
2 7 1 6 1 1
5 5 2 4 1 6 3
1 5 3 10 4
8 4 4 7
11 13 6 7
23 7 8 12
9
30 8 12
8 19
2 21
4
5 2
5 56 47 42 44
4 54 38 42
41 38
28 34
23
1 2
3 2 1 7 1
1 1 2 9 6 4 5
6 1 5 1 7 4 4 5
6 5 4 8 6 3 2 8
8 3 2 3 7
5 4 4 6 5 3 6 7 7 5
2005 2006 2005 2006 2005 2006 2005 2006 2005 2006 2005 2006
BUCHAREST*
BUCHAREST* MUNTENIA, OLTENIA BANAT-CRISANA- TRANSILVANIA MOLDOVA
DOBROGEA MARAMURES
BUCHAREST*
BUCHAREST* 150-350 thsd. inh 50-150 thsd. inh. Up to 50 thsd. inh. Rural Community
16 19 15 17 16
8 6
8 3 11 11
4 5
6 5 4 5
6 11 7 10
10
12 8
7
41 48 34
35 35
1
1 4 1
1 4 1 4 5
4 4
4 5 3 11 4
6 6 5 5
Total FMCG Food Basket Beverages Basket Personal Care Basket Home Care Basket
14000 Metro C&C
12647
Selgros C&C
12000
Carrefour
Count of Promoted Products
10000 G’market
7563 Cora
8000 6842
Kaufland
1200 Metro C&C
Selgros C&C
10 10
1000 Carrefour
Count of Promoted Products
867
809
Cora
800
G’market
6 39 639
Real
600 53 8
Univers’all
4 33
377 Kaufland
400
328
2 84 269
256
Mega Image
200
1 80
14 3 1 37
La Fourmi
Billa
0 XXL Mega Discount
Profi
1 record=1 promoted product
Angst
Artima
3500 Metro C&C
32 57
Selgros C&C
3000
Carrefour
Count of Promoted Products
247 9 Cora
2500
Real
2000 1 861
G’market
1659
Kaufland
1500
XXL Mega Discount
953
1000
80 6 Plus Discount
4 37
Penny Market
500 332
235
1 41 119 118 Brico Store
47 45 35
0 MiniMAX Discount
Billa
1 record=1 promoted product
Profi
Praktiker
HYPERMARKETS
DISCOUNTERS
Average monthly FMCG spending per household (RON) 87.49 111.61 122.44
150-350 50-150 Up to 50
Bucharest* Rural
thsd.inh. thsd. inh. thsd. inh.
Frequency of purchase (every x-th day) 0.42 0.53 0.51 0.61 0.63
Average number of purchasing occasions per
month 12.8 16.0 15.5 18.5 19.2
Average purchase (RON) 12.04 8.55 8.59 7.44 5.30
Average monthly FMCG spending / hh (RON) 154.60 136.60 133.34 137.40 101.89
hypermarkets doubled their value share in 2006 (8%) compared to 2005 (4%), as well as
discounters that raised from 2% in 2005 to 4% in 2006;
in Cash & Carry and Hypermarkets, people tend to spend more, but less frequently, while in
supermarkets they are going more often, spending less;
looking over the value shares of different types of outlets by regions, it is obvious the increasing
importance of hypermarkets in Bucharest; Muntenia-Dobrogea and Transilvania also recorded
significant share increase for hypermarkets;
in rural community and small urban, traditional trade is still dominant, but perspectives are
optimistic for the modern trade in the future;
Cash & Carry and wholesalers have significant importance for big cities (150-350 thsd.
inhabitants);
when shopping for food, buyers tend to prefer supermarkets, as well as agro & food stores, while
for beverages they prefer proximity stores (boutiques);
the situation is different when shopping for personal care and home care products, for which
modern trade is preferred due to large range of offered products and brands from which buyers can
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
analyzing the purchase structure by outlet type - considering small shopping to be less than 14.51
RON per purchase act and big shopping, the purchase acts that exceed this amount - we can
conclude that:
-> 78% of the 2006 FMCG expenses were made in frequent shopping occasions (small
shopping trips) with an average amount spent per purchase act of 6 RON;
-> high expenses per purchase act are made, as expected, in cash & carry (94%) and
hypermarkets (78%), but also in supermarkets (52%) and discounters (50%);
-> small shopping is typical for traditional trade (an average of almost 7 RON/purchase
act).
the average monthly FMCG spending per household increased by 40% in 2006 compared to 2004,
when the expenses per month were of only 87.49 RON (for the measured FMCG products);
while Bucharest inhabitants are spending 12.04 RON per purchase act, rural inhabitants are
spending only 5.3 RON; in rural, though, the low expenses per purchase act are compensated by a
higher number of purchasing acts per month of 19 occasions, compared to 13 occasions in
Bucharest;
this trend finds explanation in the importance of modern trade for Bucharest buyers, who prefer to
spend more at one purchase occasion and go shopping less frequently.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
3.3
1%
Private Labels
99%
Branded
Private Labels
Segments
12% 1% 9% Food
Beverages
78%
Personal Care
Home Care
PL CARREFOUR 37
PL CORA 35
PL G`MARKET 5
PL KAUFLAND 54
PL MEGA IMAGE 23
PL METRO 168
PL MINIMAX 14
PL PLUS 51
PL PROFI 27
PL REAL 32
PL REWE-DISCOUNTERI 12
PL SELGROS 47
PL XXL 4
16%
84%
Russia
0%
Czech Republic 100%
17%
83%
Ukraine
0%
100%
Hungary
22%
78%
Croatia
7%
93%
Source: GfK Consumer Tracking; Calculation based upon consumer basket including monitored product categories; Measure: value share (%); Period: 1HY
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
PRIVATE LABELS – SELECTED CATEGORIES WITH HIGH PL
SHARES
87
Edible Oil
Napkins
11 9
12 11 Handkerchief
10 9
89 91
88 89
90 91
volume % value %
volume % value %
volume % value %
4 3 Branded
Breakfast Cereals
6 3
96 97
Tinned Vegetable
4 4
94 97
volume % value %
96 96
volume % value %
volume % value %
compared to other CEE markets, with a value share of 1% in Romania, private labels are still in an
incipient stage and have enough space to develop in the next years;
countries where private labels are well represented are Slovakia (23%), Hungary (22%), Czech
Republic (17%) and Poland (16%);
some selected categories for which the development of private labels is noticeable in Romania are
Edible Oil, Breakfast Cereals, Paper products (Napkins and Handkerchiefs);
continued private label growth in neighboring countries and the beginning of such development in
Romania, could lead to the progressive consumer attention towards products belonging to both
segments – low end and premium , at the cost of the middle segment.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
OVERVIEW
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
The year 2006 ended a phase for both Romanian history and retail industry, since 2007 places our
country in a European context and starts a new development phase for what we call retail and FMCG. The past
three years showed that we are more and more a society with changing needs, for which the consumption
begins to receive a different dimension.
After the 2005 explosive growth, the rising trend of consumption continued last year with a lower
growth rate. The beginning of the year was the most promising time, continuing somehow the 2005 euphoria,
while the following quarters brought significantly lower growth. Most products showed a rising trend, based on
less spending for bulk and home-made products and more on brand/industrialized goods.
Modern retail development, one of the main factors that encouraged consumption growth in 2005,
continues to play an important role on the Romanian market. Nevertheless, in 2006 the story took a different
turn, therefore hypermarkets and discounters played the major part. Supermarkets, the most dominant retail
form in the country, consolidate their position, reaching a market share of 23%.
Attracting a larger number of consumers was the determining factor, influencing evolution of
modern retail in 2006, with hypermarkets and discounters almost doubling customer traffic. However, the
number of such clients is significantly lower than supermarket customers, which benefit from a better
geographic spread, with more than 60% of Romanian families shopping at supermarkets for their FMCG.
GfK Custom Research FMCG Distribution Channels - Romania June 2007
Romania
Besides an almost double figure of hypermarkets and discounters consumers, another trend of
Romanian retail is that both shopping frequency in modern retail and the money spent during one shopping
trip rose significantly, unlike traditional trade, where both factors declined.
If the main conclusions for 2006 were the development of modern retail and changing shopping
habits due to increased income, 2007 marks the beginning of a period which will outline several strong
trends. EU accession brings a new context for retail evolution, therefore, dissolving the borders between
Romania and EU will change the familiar notion of import/export into a new form of transfer/exchange of
goods among the EU members states.
European experience shows that only the strongest brands will appear on shelves, the others being replaced
by private label items.
Based on the above scenario and even more, we can definitely say that growth has been
recorded on every level, which together with the neighboring countries experiences, made us estimate a 50%
market share for modern trade in year 2010.