GROCERY RETAILING AND LATVIAN FOOD MARKETING CHAIN. by IngūnaGulbe,Dr.oec June,2004

Transcription

1 GROCERY RETAILING AND LATVIAN FOOD MARKETING CHAIN by IngūnaGulbe,Dr.oec June,2004

2 SectorsintheLatvianfoodmarketingchainand flowofmaterialsinvalueterms,mls Data:AgriculturalMarketPromotionCenter 2

3 Groceryandtotalretailturnover, MLs Totalretailturnover Food,beverages,tobacco Data:CentralStatisticalBureau 3

4 Shareoffoodintotalexpenditures MLs % Spendingsonfood Otherexpenses Shareoffood,% Data:CentralStatisticalBureau 4

5 Storesizes,expecteddevelopmentofretail concepts Hypermarkets Supermarkets Discounters <20 >400 Otherstores Data:STCConsulting,CentralStatisticalBureau 5

6 Purchasingcriteria Firststage price brand supplycontinuity quality origin Introductoryperiod trialperiod2-12weeks demand customerresponse margins Data:AgriculturalMarketPromotionCenter 6

7 Concreteconditionsofsupplyrelationship listingfee,shelfspaceallowances,end-ofaisledisplayfees termsofpayment,retrospectivediscounts returnofunsoldunits specialpromotionslike 3for2 deals bulkpurchasediscounts specialcontributionsatopenings,remodelings,extensions, mergers replacementofweaker20%ofbrandsuponaquarterly performance Data:AgriculturalMarketPromotionCenter 7

8 Atleastonshoppingperyear,%oftotal shoppers Smallstore Supermarket Marketplace 48 Shoppingcenter 40 Hypermarket 24 Warehouse Mobiletruck Kiosk Gasstation Data:BalticDataHouse 8

9 Numberofshoppingsperyearinlargestretail networks,million Other Maxima-TMarket RIMI Mego CityMarket-Supernetto Elvi 0.35 Nelda Supermarkets/conveniencestores Discounters Data:BalticDataHouse 9

10 Mainreasonsinretailoutletselection,%oftotal shoppers Closenesstohome Goodprice Smallstores Marketplaces Freshproduce Discountoffers 38 Supermarkets 46 Wideassortment 42 Bulkshopping 33 Data:BalticDataHouse 10

11 Productvalueratings,%oftotalshoppers 89 Taste 55 Price Countryoforigin Bestbefore 38 Producer,brand Appearance Labellinginformation Data:BalticDataHouse 11

12 Breakdownofpercapitaexpendituresonfood2002, valueterms Data:CentralStatisticalBureau 12

13 Levelofselfconsumption 0% 50% 100% Purchased Self-consumed Bakery Oils,fats Meat Fish Sugar,sweets Eggs Dairy Fruits Vegetables Data:CentralStatisticalBureau 13

14 Dataandinformationissuesindeterminingthe performanceofthefoodchain Seriousproblemsinobtainingdataonfoodconvergenceareidentified Farmsales dataonvolumessoldthroughretailoutletsarenotcollected Manufacturingoutput only aggregatedataprovidedbygovernmentalstatisticsareavailable in somesectorswithhighconcentrationevenaggregatedataarenotavailable becauseofconfidentiality,supportedbylaw Retailsales: retail marketproductspecificinformationofferedbyafewcommercial companiesisveryexpensive turnoverandsalesestimatesusuallydonotcorrectfirmsnon-foodsales nodataareavailableonspecialiststoressalesinbakery,dairy,meat,fish, confectionerysegments 14

15 Mainproblemslimitingthecompetitivenessofthe Latvianfoodmarketingchain lackofcommunicationandunderstandingbetweensectorsofthe foodchain fragmentedandinefficientfarmingsector ratherfragmentedfoodprocessing lowconsumerpurchasingpower limiteddataoncoststructures andsalesvolumesnecessaryforindepthanalysisofthefoodchainperformance growingimpactofcross-borderallianceswithingroceryretailing limitedpossibilitiestoprotectdomesticagriculturalproduction 15

16 Proposalsforincreasing thecompetitivenessof Latvianfoodmarketing chain creatingofaconstructivedialogue betweenpartnersinthefoodchain bettercommunicationwiththe consumers,includingmore targetedmediacoverage assistancetoproducers,better equippingthemtomeettheneeds ofthemajorplayersinthemarket quality Parties involved MinistryofAgriculture CooperationBoardofLatvian AgriculturalAssociation FederationofLatvianFood Processors TradersAssociation LatvianStateInstituteof AgrarianEconomics MarketingCouncil 16