The Guardian has an excellent article summarizing the state of the global supermarket industry with detailed profiles about the often struggling or rapidly changing supermarket sector in a number of different countries. The article began by noting how just in Europe alone, the discounters that have wrought havoc for Tesco PLC (OTCMKTS: TSCDY), Morrisons, Asda and J Sainsbury plc (LON: SBRY) (who control two-thirds of the UK supermarket market) have an even more powerful grip on the industry. The article then goes on to summarize the state of the supermarket market in the following countries:
- Germany. “German supermarkets fought that same battle two decades ago.” (Matthias Queck, a Frankfurt-based analyst for Planet Retail)
- France. Competition in France is fierce, it is not as openly cutthroat as in the UK and it is much more tightly regulated.
- Spain. 2014 has been marked by a return to the out-of-town hypermarkets, where households shop less often but buy more on each trip.
- Italy. “Supermarkets are really the only sector [in Italy] where competition has worked out.” (Liliana Cantone of Italian consumer association Altroconsumo)
- United States. There has been an increase in the number of options available to consumers where once they had two or three local competitors, now they have four.
- Australia. Supermarket chains Coles and Woolworths (OTCMKTS: WOLWF) control roughly 70% of the sector with what’s left of the market fought over by independents and big discounters such as Aldi and Costco Wholesale Corporation (NASDAQ: COST) with the former making huge gains in market share from about 3% in 2005 to 10% this year.
- Japan. The second-biggest retail market in the world includes myriad supermarket chains – some of which operate only a handful of stores while Wal-Mart Stores, Inc (NYSE: WMT), the only “everyday low pricing” operator in Japan, has forced domestic rivals to keep their prices low where it operates stores.
- China. Walmart, Tesco, METRO AG (ETR: MEO) and Carrefour (OTCMKTS: CRRFY) have been operating in the country for years, if not decades, but they’re increasingly vying with a cohort of local chains, discount shops and convenience stores for customers who would often rather shop online.
- South Africa. Big chains like Shoprite (OTCMKTS: SRGHY), Massmart (OTCMKTS: MMRTY), Pick n Pay (OTCMKTS: PKPYY), Spar and Woolworths (JSE: WHL) compete intensely with each regularly hyping loss-leading bargains (albeit not yet at cut-throat British levels) while many analysts believed the landscape would be transformed by the 2011 entrance of Walmart who’s footprint remains relatively small compared to giants such as the Shoprite group.
To read the whole article, Brutal competition batters supermarkets the world over, go to the website of the Guardian.
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