Eutororg, Belarus' biggest retailer, posted a 8.9% increase in net retail sales in the first quarter of its financial year, as the company increased its focus on smaller, leased outlets.
In line with the company's asset-light performance, all nine stores opened in the first quarter were leased outlets, with an average size of 185 square metres.
Sales Performance
Eurotorg posted sales of BYN 1.13 billion in the quarter (€430 million), while like-for-like sales were up 3.4% in the quarter.
The positive trend in like-for-like performance was largely driven by increased traffic (+3.3%), the group said, while average basket remained unchanged (+0.1%).
The group's convenience formats accounted for 51% of total net retail sales in the first quarter, an increase of 4.4% percentage points year-on-year.
In the first quarter, the company's two online grocery services, E-dostavka.by and Gipermall.by, generated 900,000 orders, and saw revenue up 1.6%.
Eurotorg said that revenue from online grocery services increased by 15.5% during the period, which was influenced by the growing COVID-19 epidemic. It is currently looking at expanding its online grocery offer.
New Format
The quarter also saw the group launch a new hard discount format, under the Groshyk banner, which operates using a warehouse-style pallet display format, to keep operating costs down.
As of 31 March, three stores were operating under the Groshyk banner, it said.
Commenting on the group's performance in the quarter, Eurotorg CEO Andrei Zubkou said, “Eurotorg delivered solid operational growth in the first quarter of 2020: net retail sales increased by 8.9%, with a significant proportion of this growth coming from LFL sales, which were up 3.4%.
“The unprecedented challenge currently posed by the novel coronavirus pandemic has underscored the resilience of our strategic growth model. Due to their locations, convenience-format stores are in most demand among consumers amid social distancing restrictions, while price leadership has become an even more significant factor due to elevated uncertainty and lower incomes among some customer groups."
As of 31 March, Eurotorg operated a total of 872 grocery stores across Belarus, with a total selling space of 335,600 square metres.
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jon. Click subscribe to sign up to ESM: The European Supermarket Magazine.
