Plus and Coop Merger to Produce a 10% market share

Supermarket chains Plus and Coop have announced they will merge and continue under the name of Plus. The consolidation will create a company with a turnover of five billion euros and 550 stores. This will make it the third largest supermarket chain in The Netherlands after market leader Albert Heijn and Jumbo. Albert Heijn has a market share of 35%, Jumbo 21.5% and the merged Plus will have a market share of 10%.

Experts view the merge a logical step in view of retailers’ need for high investments in IT, robotics and technology. The amounts needed are simply too high for smaller players and these are likely to disappear from the retail landscape in the future. The merger will save the new Plus around 50 million euros annually. The merger is subject to the usual conditions, like approval by the competition authorities, and is expected to close in early 2022.
Lidl Launches ‘With love local’ Line

Discounter Lidl has launched a local own brand “S ljubavlju, domaće” (With love, local) in Serbia. Consisting of about 80 SKUs initially, the new private label line includes traditional homemade products such as fresh milk, natural and fruit yogurts, homemade greaves, Srem pie crust, Fruška Gora cheese, raspberries and dried meat, all sourced from local producers.

In other countries, the retailer boosts local sourcing as well. In France, domestically sourced products are labeled “Origine France” and the company says that 72% of the range comes from French suppliers. In Spain, it emphasizes the ties with regional producers from, for example, the Basque country with the slogan "Euskalduna da, ona da" (It’s Basque, it’s good) and on the Balearic Islands it uses the slogan “És Balear, ES Bo” (It’s Balearic, it’s good). In Sweden, the retailer set up a special "Fast Track" program for smaller suppliers, which accelerates the listing process. 280 items are currently certified with the "Från Sverige" (from Sweden) seal of origin.

The focus on local is part of Lidl’s commitment to shorten the supply chain in order to work more sustainably. In addition, it helps the company establish good relationships with customers and suppliers within the countries that it operates. Worldwide, Lidl has 11,200 stores in 29 countries.

Initiative Seeks Recycling Vending Machines in Supermarkets

A European Citizens Initiative has called for the introduction of reverse vending machines for plastic bottles in supermarkets. The campaigners have called on the EU Commission to implement an EU-wide deposit scheme to recycle plastic bottles.

The #ReturnthePlastics initiative comes in response to the negative impact of plastic pollution on the environment, animals and humans. When plastics are not recycled or collected, they end up in landfills or waterways before entering the ocean.

On 3 July 2021, the EU Directive on single-se plastics came into force. However, the Directive, which bans the 10 most common single-use plastic items, such as plates, cutlery and straws – in Member States, does not include plastic bottles.

The initiative proposes that a deposit of €0.15 be paid with the purchase of a plastic bottle by the consumer at the cashier. A #ReturnthePlastics ‘special logo’ on the plastic PET-bottle would indicate this to consumers. When scanning the barcode of the plastic bottle, the €0.15 deposit would automatically be added to the consumer’s bill, mentioning that this amount is the deposit fee for the plastic bottle purchase.

Some EU countries have had a deposit return scheme (DRS) for plastic bottles for many years. Norway, Sweden, Finland, Denmark and Germany are frontrunners. They have achieved recovery rates of 90% after implementing their deposit systems. Other countries have indicated that they will introduce a system in the coming years. There are also a few countries that have not yet started a debate regarding the introduction of DRS on their territory.

The organizers of the initiative need to get the support of at least 1m EU citizens, with minimum numbers in at least seven Member States, within a one-year period before the Commission considers legislation.

Edeka Announces New Purchasing Alliance

Edeka has created a new purchasing alliance: Epic Partners. The alliance, which has its headquarters in Geneva, also includes Dutch Edeka partner Picnic, ICA, Magnit, Migros, Jerónimo Martins and its subsidiary Biedronka. Gianluigi Ferrari, previously CEO of the AgeCore alliance, will head the new entity.

The organisation will negotiate on-top conditions with manufacturers across national borders. With combined sales of around 140 billion euros, Epic’s focus is on large international brand manufacturers. The alliance will not negotiate with SME suppliers or farmers.

Christian Verschueren, DG of EuroCommerce, the principal European organisation representing the retail and wholesale sector in Brussels, sees the new creation as an important way for retailers to be able to keep consumer prices reasonable. Among manufacturers, the new alliance caused a stir. The first talks are expected to take place in the coming weeks.

New Ranking of Top 50 European retailers

Analyst Edge by Ascential has released its annual European food retail ranking forecast for 2021. Three German chains top the list. Based on turnover, Schwarz Group is first with estimated revenues of 144.57 billion euros, for a growth of 5.3%. More than three quarters of the turnover can be attributed to its subsidiary Lidl. In second place, at a large distance, is Rewe, which is expected to grow by 4.5% to 81.33 billion euros this year. Third is Aldi, which is forecast to grow by 6.6% to a turnover of 75,48 billion euros. UK market leader Tesco is in fourth place, ending the year with 73,54 billion euros of sales, a decline of five percent. German market leader Edeka follows with a turnover of 69,87 billion euros.

The next four places are held by French retailers Carrefour, E. Leclerc,  Auchan and ITM (Intermarché), followed by Dutch Ahold Delhaize, which is expected to have a turnover of 35.5 billion euros. This corresponds to a growth of 8.3%, the highest growth among the top ten companies.

As for other countries, the first Russian retailer is the X5 Retail Group on the 12th spot, Spanish chain Mercadona is 13th, Polish Eurocash 15th, Italian Conad 17th, Swiss Coop is 18th, Portuguese Jerónimo Martins 22nd, Swedish ICA Group 23rd, Finnish Kesko 37th, Danish Salling Group 39th, Norwegian Reitan Group 40st, Belgian Colruyt 44th and Irish Musgrave ends the list in 50st place.

Target Store Brand Sales Outpace Store-Wide Growth

Target has reported its owned brands had a jump in sales in the “mid-teens” for the second quarter, outpacing total sales increases for the retailer.

 “Our diverse collection of owned brands continues to grow and provide differentiation across our assortment,” Target’s Christina Hennington, executive vice president and chief growth officer, said during the company’s financial call announcing the results.

 She added that in the food and beverage category, Good & Gather showed a strong growth in sales and Target’s new line of snack and food products, Favorite Day, has also shown encouraging results. Food and beverage sales reported “low, double-digit growth.” Bakery, café, and deli sales were especially successful, with sales above 50%.

Plant-Based Foods Sales Projected to Reach $162B by 2030

Bloomberg Intelligence has reported the global plant-based foods market is forecasted to have dramatic growth in the coming years. The expected sales of plant-based foods could reach $162 billion by the year 2030, up from $30 billion in 2020.

The two largest subcategories of plant-based alternatives -- dairy and meat -- are expected to continue as the largest segments. Bloomberg foresees growth to be found in new formulations and products such as plant-based ice cream, cheese, sour cream, and butter. An increase in consumer concerns about health and sustainability and the continued growth of vegetarians and ‘flexitarians’ are also predicted to be drivers of growth.
Albertsons Launches Subscription Delivery Service

Following in the footsteps of Amazon, Walmart and Ahold Delhaize U.S., Albertsons has launched a subscription delivery service, along with a larger shopper loyalty program and a new app.

The new subscription delivery service is called “FreshPass” and gives exclusive unlimited grocery delivery service with member-only perks. The company also announced the launch of its “Albertsons Deals & Delivery” app, and “Albertsons for U”, a redesigned shopper loyalty program.

Albertsons is highlighting store brands with the new service. FreshPass offers 5% off the company’s O Organics and Open Nature private label products. Albertsons also announced store brand penetration has reached 25.2%; the company launched 318 new store brand products during the first quarter. 

FDA Rejects CBD as a Dietary Supplement

The U.S. Food and Drug Administration has reaffirmed that CBD can’t be marketed as a dietary supplement. Two product applications from CBD companies, Charlotte’s Web and Irwin Naturals, were both denied in August. FDA rejected the two notifications as CBD is the active ingredient in the approved drug product Epidiolex and the agency would not let it be marketed as a dietary supplement.

 FDA’s concerns focused on the scientific evidence submitted by the companies which the agency said did not provide an adequate basis to conclude that a dietary supplement would be safe. For these reasons, FDA ruled CBD products are excluded from the dietary supplement definition.

Although the FDA has claimed it wants to ensure consumer products containing CBD are safe, it has yet to act, which creates a major problem for the CBD industry. They are legally produced and used across the nation, but CBD products are currently not regulated at the federal level and state regulations vary, creating difficulties in transportation and sales.

Walmart Offering Local Delivery to Other Retailers

Walmart has announced its in-house delivery platform, Spark Driver, will be available to other businesses so independent contractors delivering Walmart groceries and products can make additional deliveries along the way.

 Called Walmart GoLocal, the service is another way for the company to strengthen its delivery platform by adding more paying pickup and drop-offs while drivers are out. It is a direct competitor to other last-mile delivery services such as DoorDash, Instacart, and Shipt, which is owned by Walmart’s rival Target.

 Under this new system, the delivery person wouldn’t arrive in a Walmart vehicle or Walmart attire, which helps make it an option for other big chains. Executives at Walmart explained the far-reaching potential of the new service, which could deliver cupcakes from a local bakery or auto parts from a national retailer to a car repair shop.