	June 2010

	IN THE STORES Real, the hypermarket retailer owned by Metro, plans to significantly increase its private label range this year
	PLMA NEWS Private label gains across Europe, PLMA Yearbook reports
	EVENTS

“World of Private Label” keeps growing

Neither difficult economic conditions nor the threat of volcanic ash kept buyers and sellers from around the world from getting to PLMA’s 2010 “World of Private Label” International Trade Show held last month in Amsterdam. Visitors from more than 90 countries attended the event, which filled up the RAI convention centre with more than 1900 exhibitors.

   The growth of “World of Private Label” reflects the success of retailer brands across Europe. The latest data compiled for PLMA’s 2010 International Yearbook shows that private label gained market share in 14 of the 20 countries tracked by Nielsen and currently represents at least one of every five products in all but two of the countries.
   PLMA is introducing a trade show that focuses on the private label opportunity in China. PLMA in conjunction with the Shanghai International Sourcing Promotion Center is holding the Shanghai Private Label Fair on 8-10 December 2010. The show will help exhibitors meet buyers from China's leading retailers and wholesalers as well as trading companies and manufacturers in China. For more information, click on shanghai@plma.nl
   The next PLMA exhibition will be its annual US Private Label Trade Show in Chicago on 14-16 November. Private label is growing strongly in the U.S. and now accounts for nearly one out four products bought in supermarkets. Total private label sales climbed to more than $86 billion, according to PLMA’s 2010 Private Label Yearbook.

Belgium: Ahold may enter, Carrefour may exit

   Two big international retailers may be changing places in Belgium. Ahold is considering entering the market with its Albert Heijn stores from The Netherlands, while Carrefour is selling off some stores amid press speculation that it may eventually leave the country.
   John Rishton, CEO of Ahold, Albert Heijn’s parent, told analysts: “We see opportunities to grow in Belgium. We are evaluating organic growth for Albert Heijn into Belgium, in particular whether we can push over the border and use the logistic strength of our Dutch operation”.
   Carrefour has announced its intention to close as many as 21 stores in Belgium by the end of June in an effort to fix its loss-making operations. The retailer, which operates 56 hypermarkets, 378 supermarkets and 191 small stores in the country, says it has no plans to withdraw from the market.
   The other two top retailers, Colruyt and Delhaize, are pushing hard to increase their market share. Delhaize CEO Pierre-Olivier Beckers commented: “Delhaize Belgium’s performance is outstanding and our continued price repositioning efforts, together with successful sales building initiatives have resulted in continued weekly market share gains for 15 months now”.
   Colruyt, a discount retailer, plans to open 17 shops in Belgium this year, including Colruyt supermarkets and eight OKay corner stores. “In the long run, we have a list of 70 possible locations for Colruyt supermarkets,” Jef Colruyt told a local publication. He said the retailer could add more than 100 OKay corner stores as well as 80 more shops to its network of 260 Spar stores.

Carrefour plans 15% cutback in SKUs

   Carrefour plans a big cutback in the number of SKUs for fast-moving consumer goods, Lars Olofsson, CEO, told a business publication. The retailer’s Carrefour Category Optimisation (CCO) program will result in 15% few items carried, a reduction in the number of supplier brands and more private label. Previously, the executive said Carrefour aims for private label share to eventually reach 50% of all products sold.
   Carrefour also hopes to get customers back in its hypermarkets by capitalizing on Carrefour Competitive Pricing to better target promotions and prices. The hypermarkets will feature more attractive everyday pricing and fewer-but-bigger promotions.
   Carrefour recently launched “PromoLibre” for its loyalty cardholders in France. Each week, Carrefour promotes a specific product category: loyalty cardholders who buy three grocery products from the promotional category can get the cheapest of the three products for free.

UK recommends cuts in saturated fats

The UK Food Standards Agency has recommended substantial reductions in saturated fat reductions. The FSA says that plain, sweet and savoury biscuits and plain cakes should have saturated fat reduced by 10% from 2008 levels by the end of 2012. The FSA plans further recommendations soon on dairy and meat products, pastry and savoury snacks.
The FSA states that in the case of doughnuts and other fried buns, the sector should move to reduced saturated-fat frying oil where possible, and the agency cautions that reformulation should not result in increased levels of total fat, trans fat or sugar added to the product recipe. The agency, whose recommendations are voluntary, said it has included additional industry information on costs and reformulation.

EC makes online retailing rules

The European Commission has made new competition rules for online retailing. The EC says companies will be free to adopt the type of distribution they prefer provided their agreements “do not include restrictions on price fixing and that neither the producer nor distributor has market share of over 30%”. Producers can choose their distributors on the basis of quality standards for the presentation of products.

Wal-Mart sees supply hub in India

Wal-Mart is looking to make India a major sourcing hub for its business around the world. “We will look forward to export products worth hundreds of millions of dollars from India in the future”, said Scott Price, Chief Executive of Asian operations. The retailer recently opened the second wholesale store in its Indian joint venture with Bharti Enterprises.

Casino uses online system for its brands

Casino will use an e-management system, called Trace One, to develop its private label ranges at the Franprix and Leader Price formats. Trace One offers a platform for e-collaborative European management development and quality of private label products. Casino noted, “This platform is already operational and tested in the majority of our suppliers. This will enable us to develop our private label faster and more safely”. The retailer said the new system will help assure product compliance to group policy quality and food safety standards, and a faster reaction in case of emergency or crisis support.

Rewe offers a sustainable brand

Rewe has introduced a sustainability brand called Pro Planet. It will highlight existing private label ranges whose manufacturing involves sustainable methods. After its introduction in fruit and vegetable departments in Germany, the label will be rolled out to other product categories including both food and non-food across all of Rewe’s store banners. Pro Planet was developed in cooperation with the Centre on Sustainable Consumption and Production, a joint organisation of the United Nations Environment Program and the Wuppertal Institute for Climate, Environment and Energy.
In Czech Republic, Rewe’s discounter Penny Market is introducing an economy private label line called PR!CE. The range is initially comprised of six products and marketed under the strapline '`etYíme pro Vás,' (Savings for You). The simple, uniform packaging design resembles brown and white cardboard boxes with barcode imprints.

Migros to expand Bio brand

Migros in Switzerland will expand its organic private label Bio this year and introduce new packaging. The focus of new products will be on bread, dairy products, meat and charcuterie and frozen food. The Bio private label currently comprises 1,000 SKUs. Last year, sales of Bio products rose 7% and the retailer wants to increase volume by reducing prices on many of the items by more than 5%.

Auchan revamps Simply Market

Auchan is revamping its new Simply Market format following the banner’s weak sales results. SKUs will be increased from 10,000 to about 11,000. Promotions are being introduced again as well as service counters. The changes are being made to capture consumers who prefer promotions and a wider range of products on offer.

ICA launches new banner

ICA in Norway is launching a neighbourhood store banner, called Matkroken. The company’s existing ICA Nær and ServiceMat neighbourhood stores are due to be rebadged to the Matkroken banner. The conversion of 30 stores will be finalised by mid-June. By the end of the year, the group plans to have up to 60 stores.
In Sweden, ICA has opened its first eight Cura pharmacies, following the country’s recent liberalisation of the pharmacy market. The retailer aims to have about 20 pharmacies operating by the summer of this year and a total of 100 Cura stores in the next few years.

Marks & Spencer debuts Perfection brand

Marks & Spencer is revamping its cosmetics range. A new brand, Perfection, has been launched which replaces existing cosmetics brands Per Una and Autograph. Perfection consists of 44 products in the health and beauty category. Another range, Perfection Illusions, includes seven products. “Perfection consolidates our cosmetics offer into a single brand, making it easier for the customer to shop,” said the retailer.

Alcampo launches gluten-free range

Alcampo has launched a range of 15 gluten-free products in Spain which includes chocolate croissants, baguettes and loaves of bread. The range was been created for its parent company, Auchan. These products will be sold at both Alcampo and Simply Market stores. The retailer already sells 270 items for coeliacs, of which 120 are of its “Vivir mejor” or “Live better” Auchan private label range. Alcampo plans to continue developing its gluten-free range this year.

Boots and Waitrose sell each other’s brands

Two UK-based retailers, Boots and Waitrose, have begun selling some of each other’s brands. Four Boots stores now stock a selection of Waitrose lunchtime products, such as sandwiches, wraps and desserts. As part of the trial, Boots health and beauty products and toiletries will be on offer within seven Waitrose stores. Products include items from the No7 skincare and cosmetics brand.

IN THE STORES

Real, the hypermarket retailer owned by Metro, plans to significantly increase its private label range this year.

Aldi has introduced regionally sourced organic dairy products in Ireland. The Liskeel brand comprises several yoghurts made from organic milk. Aldi has also launched Irish meats under the Nature’s Isle brand.

Tesco plans to open 50 stores and a distribution centre in Poland, along with a 57,000 sqm distribution centre in Gliwice.

Eroski in Spain has removed trans fats from all its private label products. The retailer says trans fats were removed from more than 100 products.

Asda is expanding its ‘Free from’ range, catering to people with food intolerance. The UK retailer is introducing gluten-free pizzas, pasties, sausage rolls and steak pies.

Casino will no longer use palm oil in its food products and replace it with rape seed, sunflower or vegetable oils.

Makro in the UK has entered a partnership with Palmer & Harvey to form a new buying group called PalMak.

Franprix has launched a range of 10 wines; five reds, three whites and two rosés.

Dm-Drogerie markt in Germany has shifted from its strict EDLP strategy to counter discounts offered by its drugstore competitors, according to published reports.

Waitrose in the UK has extended its sandwich and salad range, with 90 new products. The range now includes ‘open’ sandwiches, tear and share rolls, and large salad bowls.

Axfood in Sweden has introduced a sustainability initiative that involves the environment, animal welfare and social issues.

Pharmacy chain 36.6, a health and beauty retailer in Russia, is now selling its private label SKUs to government-controlled State Unitary Enterprises, Bryansk Farmatsia and Farmatsia.

Pick n Pay, a South African grocery retailer, reports double-digit growth in private label sales.

Spar in Denmark has opened 18 Eurospar stores across the country.

AB Vasilopoulos in Greece will roll out a discount format. AB intends to open around 60 stores within the next 5 years.

In the Czech Republic, Kaufland plans to substantially extend its economy private label line, K-Classic. The hypermarket retailer will introduce products in the confectionery, savoury snacks, drinks and pet food and nonfood categories.

PLMA NEWS

Private label gains across Europe, PLMA Yearbook reports

   Private label reached record market shares across Europe last year as retailers relied more than ever on their own brands to offer value to shoppers coping with the great recession, according to Nielsen data prepared exclusively for PLMA’s 2010 International Private Label Yearbook.
   For the first time, private label accounts for at least 40% of all products sold in a total of five countries. Overall, private label gained in 14 of the 20 countries tracked by Nielsen and currently represents one of every five products in all but two of the countries.
   The gains came in the western national markets such as France, Germany, Spain, The Netherlands and Belgium, but were especially strong in emerging retail markets such as Poland, Hungary, Slovakia and Turkey. This growth is creating a solid foundation for more growth as retailing matures in these countries.

EVENTS

14-16 November	US Private Label Trade Show Chicago
8-10 December	Shanghai Private Label Fair Shanghai

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