2016 set to be record year for supermarket chains on Czech market

Photo: archive of Radio Prague

2016 is set to be a bumper year for the Czech Republic’s supermarket chains, which took in over CZK 200 billion in the first three quarters according to the national statistics authority. Meanwhile, a number are investing billions in buildings and new technology, iHned.cz reported on Thursday.

Photo: archive of Radio Prague
Supermarket chains saw revenues of CZK 204 billion in the January to October period, some CZK 4 billion more than in the same period in 2015, the news website said. If the trend continues this will be a record year for the large retailers.

The average Czech household spends around 13 percent more on fast-moving consumer goods in November and December than in the other 10 months of the year. What’s more, they tend to do that shopping in hypermarkets, Ladislav Csengeri of market analysts told iHned.cz

The large retailers’ prosperity is reflected in their ambitious investment plans, the news site said. For instance, Kaufland, the country’s biggest chain by turnover, has ploughed some CZK 3.25 billion into building new outlets and renovate existing ones this year. It has earmarked three times that amount for the same purpose over the next three years.

Kaufland saw a profit of CZK 2.1 billion crowns for the financial year that ended in February 2015. The discount chain Lidl – which like Kaufland is owned by Germany’s Schwarz – earned half a billion more in the same period.

Lidl is also lining up major investments in its Czech stores – no less than CZK 9 billion in the next two years. Its new outlets will come with a new concept that includes wider aisles and a greater selection of fresh foods and baked goods, a spokesperson told the news site.

Penny Market, which is also German, is to invest CZK 2.7 billion into a facelift that will make its shops look more like markets, iHned.cz said. Germany’s Globus – which has been longest on the local market after opening its first store here in 1996 – is to add small outlets that also serve food to its chain.

The chains are also investing in technology. Tesco was first on the market to bring in self-service checkouts in 2008 and says two-fifths of its customers are using them today.

Now, says iHned.cz, the company and Globus are turning their attentions to “Scan&Go” technology. This involves customers being given a handheld scanner when they enter a store and scanning their purchases as they go, paying without having to queue on their way out. Tesco say they may also bring in a mobile app for this purpose.

Tesco is the only one of the large chains that currently offers online shopping. However, Globus and Lidl also now looking to enter what is the fastest growing section of the market.