Hypermarkets in Romania

2021 DEVELOPMENTS

Hypermarkets continues to struggle as growth rates remain below par in 2021

Hypermarkets registered a sub-par performance in Romania during 2021 as the influence of the third and fourth waves of the COVID-19 pandemic presented major challenges to retailers operating in the category. On a practical level, hypermarkets were generally not subject to the severe restrictions placed on the operation of retail outlets during 2020 and 2021 due to the status of these stores as primary sources of essential goods.

Omnichannel retailing emerges strongly to support flagging hypermarkets sales

One of the most important trends to emerge in hypermarkets towards the end of the review period was the much stronger focus on e-commerce that was seen among category players in the wake of the COVID-19 pandemic. With consumers often reluctant to visit a store to go grocery shopping due to the perceived risk of coming into contact with the COVID-19 virus that this would present, there was a huge upsurge seen in demand for food and drink e-commerce during both 2020 and 2021.

Kaufland continues to expand throughout Romania, underpinning its strong leadership

At the end of the review period, Schwarz Beteiligungs GmbH remained the leading player in hypermarkets in Romania with its Kaufland chain well on top in a highly competitive category. Kaufland’s success in Romania can be treated mainly to the strong expansion of the chain’s outlet network throughout the country in recent years, with Kaufland hypermarkets appearing in second-tier and third-tier cities during the review period.

PROSPECTS AND OPPORTUNITIES

A muted performance ahead as demand shifts towards proximity retailing

The underwhelming performance registered in hypermarkets in 2021 is expected to continue into the forecast period, with the category set to find itself at odds with the prevailing consumer trends in grocery retailers. Specifically, the forecast period is expected to see further increases in consumer demand for proximity retailing formats that offer convenience.

Few changes expected to be seen in the competitive environment in hypermarkets

Over the forecast period, it is expected that the competitive landscape in hypermarkets will remain largely unchanged. The substantial amounts of investment capital required to develop a chain of hypermarkets means that only major multinational retailers with strong international brands such as Kaufland, Carrefour, Auchan and Cora are able to compete in the category.

Hypermarkets players set to take action to address flagging sales

With hypermarkets set to remain under pressure during the forecast period for the reasons stated above, the category’s leading players are expected to focus more of their attention on developing marketing and business development programmes with the potential to give them an advantage and minimise potential losses in a flagging retail category. Among the specific focus areas that are likely to emerge is the increasing demand for products of local origin that is being seen among the remaining population, a trend that has arisen primarily from the affection and respect that local consumers have for smaller domestic producers of fresh food.