Six months after the merger of Konzum and Mercator, Croatian food-to-retail consortium Agrokor claims it has managed to stay in front of rival Lidl, while achieving growth in sales.
Speaking at a business event for suppliers in Zagreb, Jure Radoš, director of procurement at Konzum Hrvatska, and Tomislav Čizmić, director of Mercator in Croatia, said that the two retailers have achieved six billion euro in total revenues in the five Adria region markets (Croatia, Slovenia, Bosnia and Herzegovina, Serbia and Montenegro). This compares to the €1 billion in revenue of hard discounter Lidl.
In the last quarter of 2014, sales in Serbia were 11 per cent higher per square metre than in the same period in 2013, in Slovenia they grew by seven per cent and in Bosnia and Herzegovina by five per cent.
Konzum is responsible for the markets of Croatia and Bosnia and Herzegovina, while Mercator manages operations in Slovenia, Serbia and Montenegro. Together they have 2,000 stores with four million square meters of sales area.
Asked how Konzum and Mercator are facing up to increasing competition from discounters such as Lidl, Radoš replied that any Konzum supermarket can cope if it manages to match the offer from its rivals.
"Discounters have 1,500 and we have 20,000 products. Our task is to compete in terms of price with our products of the same quality with their 1,500, while the rest of the products represent an additional offer for customers," he explained.
Radoš and Čizmić announced new investments, such as the construction of distribution centers in Belgrade (Serbia), Ljubljana (Slovenia) and Sarajevo (Bosnia and Herzegovina), and a new concept of shopping malls.
They also said suppliers need to focus on the product category in which they are most competitive instead of launching in new categories where they are faced with intense foreign competition. Finally, they promised support for the consolidation of the manufacturing industry, as production in the former Yugoslavia region is highly fragmented.
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic
