French retailer Auchan is planning to boost its market presence in Portugal by opening supermarket franchises.
The chosen brand is Pão de Açúcar, and two stores are already in operation in Ericeira. By the end of the year, there will be between eight and ten stores operating in this format.
In an interview for daily Diário Económico, the director of franchising, partnership and exports of the Auchan Group, Jaime Lemos, revealed that the intention is to enter the "neighbourhood segment", where the retailer was not yet present in Portugal.
If the format proves successful, there is a plan to open around 80 stores by 2019. The expansion of this model will be based on a number of partnership agreements that already exist with about 50 companies, owners of individual supermarkets – which correspond to 123 points of sale – for which the group is already the main supplier of goods.
As regards to size, the stores range between 300 and 800 square metres, but there will be others that will have between 800 and 1500 square metres. The idea is to open 15 supermarkets next year and then about 20 supermarkets in each subsequent year to 2019.
Lemos pointed out that franchisees will have access to the same purchase prices for the Auchan private-label brand and to the Jumbo Card customer relationship programme.
The retailer will also provide training and assistance in setting up the store layout. Lemos expects that, as a result of the partnership, franchised stores could see their sales grow by between 25 per cent and 30 per cent.
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic.
