Auchan only has large stores in Romania, with a floor area of 12,000 to 13,000 square meters, a segment that has been growing at a slower rate than other segments of the market in the last few years. Consumer spending habits have changed since 2009-2010, with Romanian consumers looking at product prices and proximity of the store to their homes first. Therefore supermarket and convenience store chains have expanded in full gear to a total of more than 900 out of 1,500 modern retail stores.
The change in consumer spending habits was the reason why Carrefour has already expanded from hypermarkets to supermarkets and to convenience stores. Auchan might therefore follow into the footsteps of Carrefour.
Auchan has been developing in full swing after buying 20 Real hypermarkets in 2012-2013 and continuing to open new hypermarkets, as well. The expansion put it on fourth place among retailers in Romania by revenue, behind Kaufland, Carrefour and Metro. Since development on the large format store segment is subject to space availability, expanding into a new segment makes sense.
However, Auchan might enter the supermarket business through an acquisition rather than opening its own stores, since the market is already crowded with Mega Image (more than 420 stores), Profi (more than 300), Carrefour (over 100 small format stores) and Billa (85) operating on it. Auchan might therefore either buy an already developed foreign-held network or several small local retail chains.
Auchan officials did not return ZF’s calls for comment on their plans to enter a new market segment by press time.
(English version by Loredana Fratila-Cristescu)