Boston, MA -- (SBWIRE) -- 06/30/2014 -- In 2013 current value sales in grocery retailers in Portugal declined by 2%, to reach ?19.8 billion. This was a slightly better performance compared with 2012. The acute drop in the employment rate, along with decreasing consumer confidence and disposable incomes, were the main factors explaining this negative trend. As a result, price and affordability became even more important to consumers at the end of the review period, leading to aggressive promotional strategies from the main retailers with the aim of encouraging customer loyalty. For instance, loyalty cards which provide consumers with special discounts on grocery purchases and in partnership with other companies (such as petrol stations) gained popularity during the unfavourable economic environment and due to the strong increase in fuel costs.
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Concentration characterises grocery retailers in Portugal, which is dominated by strong domestic players, notably Sonae Modelo Continente - Hipermercados and Jer?nimo Martins - Distribui??o de Produtos de Consumo. Sonae Modelo Continente - Hipermercados was the leading player in Portugal in 2013, with a retail value share of 19%. The company?s overall lead was mainly attributable to its strength in hypermarkets, the second largest grocery retail channel, in which its Continente brand claimed first place in 2013 with a value share of 44%. This was partly due to the fact that the group behind Continente is Sonae, which owns most of the shopping malls in Portugal. Moreover, it was also the second largest retailer in supermarkets, in which it held a 23% value share. Continente Modelo supermarkets are mainly located in residential and high-traffic areas of Lisbon, which are a high cost per square metre relative to discounters. More expensive locations require a business model which differs from discounters, but this enables the company to sustain its loyalty amongst those consumers who are looking for nearby stores with a wide product assortment.
The most important constraint to growth in the next few years is likely to be the evolution of private consumption, related to the government?s measures to combat the economic recession and the increase in unemployment, which will leave consumers even more strapped for cash. In the short term, the value sales of grocery retailers are expected to continue decreasing, as the recession will continue to impact the purchasing behaviour of Portuguese consumers. Sales are not expected to start recovering before 2015-2016. Also, the main grocery retailers will continue to invest primarily in small formats such as supermarkets and discounters. The value sales of supermarkets are predicted to remain stagnant over the forecast period, whilst discounters is likely to prove slightly more robust, with a value CAGR of 1% at constant 2013 prices.
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The Grocery Retailers in Portugal market research report includes:
- Analysis of key supply-side and demand trends
- Detailed market shares for international and locally-based retailers
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- How is grocery retailing performing in Portugal?
- Are consumers switching towards more convenient grocery channels?
- Are independent and family run grocery stores coming under pressure in Portugal?
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Product coverage: Modern Grocery Retailers, Traditional Grocery Retailers.
Data coverage: market sizes (historic and forecasts), company shares, brand shares and distribution data.
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