Variety Stores in the Czech Republic

PROSPECTS

Chained variety stores drive growth in 2018

Value sales of variety stores in the Czech Republic are driven by the three leading chains – Tchibo, Top Shop and Flying Tiger Copenhagen. The channel remained very fragmented in 2018, with a strong but declining presence of independent stores generating the majority value share; however, as customers are increasingly demanding better service and product quality, they are turning away from variety stores to internet retailers and major retail chains.

Potential for growth within variety stores through franchising or alliance networks

Small independent and unbranded variety stores are exiting the category, as they are not able to compete with major retail chains or internet retailers. Additionally, economic growth and a low unemployment rate in the Czech Republic do not favour small independent businesses.

Fixed-price stores are not popular and have only a small presence in the Czech Republic

As of 2018, the concept of fixed-price stores in the Czech Republic had not been yet developed to an extent where consumers would actively seek out such stores. There were only two chained fixed-price store brands present in the Czech Republic during 2018 – Vše za 39 (later renamed to Vše za pulku) and VŠE ZA 50 Kc; however, the performance and popularity of these stores is unclear due to limited financial information.

COMPETITIVE LANDSCAPE

Tchibo opens its flagship store in Prague to increase its presence outside shopping centres

Tchibo, the leading variety store operator in the Czech Republic, opened its flagship store in Prague in April 2018. The store adopts a unique concept layout with a clearly separated coffee shop section and product store section.

Studio Moderna expands its Top Shop store network as part of its multichannel strategy

In 2018, variety store chain Top Shop continued its strong sales performance through gradual store expansion. The Top Shop brand owner and one of the leading homeshopping companies, Studio Moderna, also continued its channel diversification strategy in response to the declining homeshopping channel.

Flying Tiger Copenhagen posts dynamic sales growth through store expansion

Danish retail brand, Flying Tiger Copenhagen, continued with dynamic value growth in 2018, albeit at a slower pace than in earlier years after making its entrance in 2014. The company’s goal in the Czech Republic is to continue expanding its store network to at least 20 stores over the forecast period.

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