With a total turnover in 2010 of 7.1 trillion rubles ($239 billion), the retail food market is growing at 13 percent — more than twice the rate of the economy as a whole — and leading retailers are seeing growth of 30 to 40 percent. However, the main driver for food retail growth is the growth of prices.
The X5 Retail Group, the largest food retailer, plans to open 540 new stores all over the country. Magnit, the supermarket chain with the greatest geographic coverage, is to open 800 convenience stores and 55 hypermarkets. Discount chain Dixy hopes to open 150 convenience stores in Moscow and the regions, and intends to attract customers with a new logo, more efficient operations, sales and discount cards.
This expansion will build on last year’s boom, in which X5 added 1097 new stores, including 660 stores via its acquisition of competitor Kopeika. Magnit opened 827 stores, compared with 646 openings in 2009. Dixy had 646 stores open in the end of 2010, up from 623 open the previous year. With last week’s purchase of rival Victoria Group supermarket chain, Dixy will own 901 stores. Sedmoi Kontinent had 146 stores at the end of the year mostly in and around Moscow, compared with 139 a year earlier.
X5’s net revenue for 2010 was 341.6 billion rubles ($11.2 billion). Magnit earned 7.1 billion rubles ($241 million) for the same period. But the market is highly fragmented, with none of the major players having more than 4 percent share, according to UralSib.
Source: www.themoscowtimes.com