Price wars at supermarkets.
| Auteur | Hollingdale, Michael |
| Fonction | Money |
Switzerland's biggest supermarkets are preparing to go head-to-head in a fierce battle to win the hearts, minds and, not least, the wallets of the country's shoppers. That could be good news for Swiss consumers, who are used to spending much more on their weekly trip to the supermarket than their European neighbours.
The size of the retail cake up for grabs in Switzerland is a cool CHF 83.1 billion and it's an industry dominated by the big two--Migros and Coop.
Competition
For many years, in fact, Migros was the undisputed queen of the Swiss high street but the upstart princess, Coop, has been gaining ground in recent years and, at its annual press conference in March this year, announced that it had finally drawn level with its rival.
In 2003, both had a market share of 16.7 per cent and together they control around a third of the Swiss retail market--a figure that rises to around 50 per cent for groceries alone.
"We are growing at the fastest rate of any retail company," says Coop Chief, Hans-Peter Loosli, clearly hoping that this may be the year that the Basel based firm finally manages to emerge from the shadow of. its Zurich rival.
In a market that is actually shrinking overall, this would be a remarkable achievement, although Migros actually contests the fact that the two companies are now equal first at the top of the retail table. It points out that if the Migros-owned department store, Globus, is included then its real market share jumps to 18.3 per cent.
Migros also hits back by saying that much of Coop's 6.5 per cent increase in turnover is less impressive than it first seems with much of the rise attributable to the consolidation of the Epa and Waro stores.
It's true that without the completion of these takeovers growth would have been far more modest at 1.6 per cent. Loosli, however, says these claims are without foundation and blames sour grapes, "The acquisition of existing stores is just a quicker alternative to building our own shops."
Loosli also likes to stress that Coop's success in raising its turnover has not been achieved at the cost of the customer. This is a touchy subject for the company, recently criticised by a consumer survey for being more expensive than other retailers. "Coop has become cheaper," he says, pointing out that prices for the entire range of goods on sale are 0.6 per cent lower than they were in the previous year.
The war of words between the two companies is bound to intensify over the coming...
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