German retailer Tegut has posted a sales increase of 1.2% for 2017, surpassing the billion euro sales mark for the first time. The retailer posted full year sales of at €1.008 billion, up from €996 million in 2016.
The retailer, owned by Switzerland's Migros Group, increased its productivity per unit area for the fifth period in a row (by 0.9%) and generated 25.4% of its sales from organic products.
The retailer also performed slightly better than its parent company, which posted a 1% sales increase for full year 2017 yesterday.
Store Expansion
Tegut opened eight new stores and closed six during the year, while eight stores underwent renovation. The retailer’s total store portfolio tallied at 273 at the end of 2017, up one store from last year.
The retailer plans to open ten new stores during 2018, including three supermarkets, two local shops and two Tegut ‘Lädchen’, it said.
In May 2017, the retailer took over the bakery chain Herzberger and invested around €700,000 by the end of the year in the business.
Logistics
In the coming year, Tegut said it plans to expand and modernise its logistics operations, with a new logistics centre planned for 2021 in Hünfeld and a telematics/track&trace solution to monitor its flow of goods.
This solution will enable Tegut to improve the delivery quality for sales, with real-time notifications and temperature monitoring of delivery vehicles, the retailer said.
It has also partnered up with online giant Amazon since March 2017, making thousands of its products from its ambient foods range available to customers on Amazon.de, Amazon Prime Now, Amazon Pantry and Amazon Fresh.
Organic Range
Tegut has also expanded its organic offering; last August, it commenced offering organic organic bananas with the Demeter seal all year-round, a first in German retail, it said.
In the GMO-free section, the retailer has worked with the Verband Lebensmittel ohne Gentechnik (Association for Non-GMO Food) to become the first German grocery retailer in November 2017 to implement the ‘GMO-free’ label into its loose foods section at the service counter.
The certification will start officially at the fresh food section at the beginning of 2018.
Under its 'Landprimus' range, the retailer has also worked on improved meat production and sourcing, encouraging better holding conditions and shorter transport of cattle, which earned it an award from the German Agricultural Society.
A New Look
The year also saw Tegut launch a new marketing campaign, with its revamped customer magazine, a new poster campaign and delivery trucks bearing slogans including 'On the way to becoming organic - a pioneer for organic products for over 30 years!' or 'Freshly loaded, fresh in the store! Fruits and vegetables at their best '.
The retailer celebrated its 70th anniversary last year with a series of promotions between September to November, including special offers as well as lottery and charity campaigns for the benefit of the SOS Kinderdorf charity.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Kevin Duggan. Click subscribe to sign up to ESM: The European Supermarket Magazine.
