Dra­matic drop in food re­tail­ing

Greeks cut down on con­sump­tion, turnover back at 2005 lev­els, and mar­ket shrinks, con­cen­trates fur­ther

Kathimerini English - - Focus - BY DIM­I­TRA MANIFAVA

Greeks have been re­peat­edly forced to cut back on food con­sump­tion since the out­break of the cri­sis, as last year’s 4 per­cent drop in food re­tail­ing took the to­tal de­crease in mar­ket turnover from 2009 to 2016 to 18 per­cent, ac­cord­ing to data com­piled by Nielsen re­searchers.

Last year’s de­cline was not only brought about by the fur­ther de- cline in de­mand, but also the spe­cial con­di­tions in the sec­tor cre­ated by merg­ers, ac­qui­si­tions and the re­struc­tur­ing of en­ter­prises, with Marinopou­los be­ing the most prom­i­nent ex­am­ple.

The Nielsen data also show a ma­jor trend to­ward con­cen­tra­tion in the sec­tor that the re­searchers es­ti­mate is set to con­tinue in the next few years, while this year food re­tail turnover is pro­jected to shrink by a fur­ther 2-3 per­cent com­pared to 2016.

Last year the sales value of food re­tail­ing – in­clud­ing small gro­cery stores – amounted to about 10.78 bil­lion eu­ros, down 4.1 per­cent from 2015. In ef­fect that means the in­dus­try went back 11 years, to 2005, though that was a pe­riod when food was bur­dened by far lower in­di­rect taxes and dis­pos­able in­come was spent on many other com­modi­ties and not pri­mar­ily food con­sump­tion, as is the case to­day.

In 2009, a year be­fore the coun­try en­tered the bailout process, food sales reached their his­toric peak, to­tal­ing 13.15 bil­lion eu­ros. The cri­sis and the en­su­ing fis­cal ad­just­ment mea­sures had a big im­pact on de­mand, re­sult­ing in the vi­tal re­struc­tur­ing of the sec­tor, with many small sales points and even su­per­mar­ket chains shut­ting down.

There­fore, while the 10 big­gest food re­tail­ers ac­cu­mu­lated 65.7 per­cent of the cat­e­gory’s to­tal turnover in 2005, the share of the top-10 com- 1.0533 pa­nies has soared to about 76 per­cent to­day. Com­pared to 32,000 in 2005, the num­ber of small food re­tail stores had de­clined to 27,000 in 2015.

Ma­jor food re­tail­ers (i.e. stores of at least 100 square me­ters) saw their sales value drop to 9.49 bil­lion eu­ros last year from 9.9 bil­lion in 2015, which is a 4.5 per­cent fall. If the im­pact of the Lidl dis­count su­per­mar­ket chain were de­ducted from the statistics, that drop would amount to 6.6 per­cent.

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