Swedish retailer ICA Gruppen has announced plans to implement a series of 'prioritised step changes', which will result in capital expenditure of around SEK 4 billion (€380 million) next year.
The group made the announcement at its Capital Markets Day, in Solna, Sweden, where it said that the step changes are necessary for the group to 'consolidate its strengths during the next three years'.
Capital expenditure at the business for 2019 is expected to come in at around SEK 3.3 billion (€310 million), which is lower than the company's previous estimates.
Measures To Implement
The step changes announced by the group include the introduction of common sourcing throughout ICA Gruppen, including at its Rimi Baltic and Apotek Hjärtat business; creating business value through artificial intelligence and advanced analytics; a transformation programme to reduce costs and build new capabilities; climate beyond neutrality; and a strengthened food ecosystem.
These will replace ICA's existing strategic priorities, the group said.
It also plans to make 'large investments' in its store network, as well as its IT, CRM and e-commerce capabilities, and it maintaining a 'high pace of investment' in its Rimi Baltic operation, both in terms of expanding the store network and completing construction of a new warehouse in Riga, Latvia.
Well-Positioned
“ICA is well positioned and have taken big steps to use the potential in our group structure," commented Per Strömberg, CEO of ICA Gruppen.
"But to ensure continued success in a changing business environment, and to take full advantage of our opportunities, we need to consolidate our strengths in a number of key areas. We are therefore singling out our prioritised step-changes that we will be working with during the next three years. Internally we will set targets for each area and will measure our progress every year."
November Performance
Elsewhere, ICA said that sales across its store network increased by 4.1% in November 2019, compared with the same period last year. Like-for-like sales were up 3.7%.
Its Maxi ICA Stormarknad banner saw the highest level of growth, up 6.1% (+5.5% on a like-for-like basis). ICA Kvantum was up 5.4% (+4.0% like-for-like), ICA Nära rose by 3.0% (+3.0% like-for-like) and ICA Supermarket was up 1.6% (+1.8% like-for-like).
For the month of November, sales totalled SEK 9.9 billion (€940 million), while for the period January to November, sales were SEK 110.4 billion (€10.51 billion), which is an increase of 3.1% over the previous year.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
