Slovakian and Czech markets expanding faster than inflation

Last year, FMCG sales expanded at a faster rate in Slovakia and the Czech Republic than inflation. The Schwarz group is the market leader in the Czech Republic, while the biggest retail group in Slovakia is Tesco. Retail sales of FMCG products grew by 5.9 percent in Slovakia, in the December 2007-November 2008 period, compared to the preceding year. Sales in terms of quantity were up by 0.8 percent. Growth turned into a decline of 0.5 percent in terms of quantity in the second half of the year. Co-operative ventures are strong in Slovakia. Jednota has 2,265 small, traditional units and 58 others in the 401-1 000 square meter segment. In 2007, it generated total sales of more then EUR 1 billion, taking second place behind Tesco on the list of retail enterprises. The two chains of the Schwarz group (Lidl and Kaufland) follow in third place. It is interesting that the Kaufland chain has decided to avoid Hungary, continuing it expansion in Romania, Croatia and Bulgaria. CBA Slovakia kft. is fourth on the list of top retailers. Small, traditional store still account for 40 percent of the total retail market in Slovakia. Hyper markets have a 31 percent market share, while supermarkets and discounts have a combined market share of 25 percent. Last year, hyper markets produced a year on year expansion in terms of value of 8.8 percent. Supermarkets produced expansion of 11.3 percent, while sales generated by traditional stores grew by only 1.1 percent in terms of value. Sales of the top 30 food categories rose by 5 percent last year. Larger than 400 square meter stores accounted for 53 percent of sales in the top 30 categories. FMCG sales in the Czech Republic were up by 11.1 percent last year, whereas the inflation rate was only 4.1 percent. In the October-November 2008 period, sales grew by 0.8 percent in terms of quantity. Only multinational retail groups are present in the Czech top 10. The Schwarz group is in first place (Lidl and Kaufland), Ahold with Albert supermarkets and Hypernova hyper markets is second, while Tesco is third on the list. The number of hyper markets was 262, while small stores accounted for only 20 percent of the retail market last year. Hyper markets hold a market share of 36 percents, while discounts and supermarkets have 19 and 17 percent respectively. Discounts generated an increase in sales of 18.9 percent last year. Lidl (197 units), Penny Market (183 units), Plus (123 units) are the largest discount chains. Sales of the top 30 food categories were up by 10 percent last year.