Is retail in Germany getting smarter?
I was fortunate enough to visit Germany last month and spent
a great deal of time speaking to retailers and visiting stores.
I also had the opportunity to visit the Real – Future
Store, which is an enlightening step into the store of the (not
too distant) future. It operates as a store open to the public
while testing the latest technology innovations in retail at
the same time.
There are a number of innovations in the store that are on
the brink of being rolled out into mainstream retail, such
as, self service checkouts and self payment options. But,
the message that comes through strongly is that smart phones
will be an integral part of the shopping experience sooner
than you may think.
It was also alarming to see exactly how competitive the
German retail environment is - not only between retailers,
but also amongst brands and the ever dominance of private
labels. Here, retailers operate on a trading margin of between
.5 % and 1.5%. In South Africa retailers have it a little
easier. Pick n Pay, which experienced a difficult year in
2010 operated with a trading margin of around 2.7% and Shoprite,
a commendable 5.5%.
But, when operating in an environment, like Germany, where
the selling price of goods is so competitive, retailers need
to go to extreme measures to drive efficiency in their businesses
and even the smallest saving is treated with a great deal
of respect. This is particularly apparent when I visited an
Aldi store, where SKU’s are kept to a minimum and private
label products dominate the floor space. To be honest, it’s
not a great shopping experience. but it’s cheap and
it certainly keeps the competition sharp.
Private label products are the core of a retail offering in
Europe and it is difficult to see how brands are able to maintain
an effective presence, especially if they‘re not the
dominant player in their category. Most retailers have three
tiered offering of good, better and best. In certain categories
the “best and Better” options are between 20%
and 40% cheaper than the leading brand and “good”
is at times more than 50% cheaper.
Suppliers have been under this pressure for some time now.
Some brands have reduced the number of SKU’s while still
developing new products in order to keep ahead in the race
against retailer labels. Those brands that have excess capacity
due to the delisting of products by European retailers will
be looking for new markets and I have no doubt that we will
soon be seeing European suppliers aggressively targeting the
African continent.
Craig Ballantyne
Please feel free to make comments or raise new issues by emailing
the editor
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Economic News
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SA
counterfeit industry worth R362bn
The South African counterfeit industry is estimated
at approximately R362 billion and is viewed as one of
the world's fastest growing industries, with seizures
of fake goods up 46% annually according to a counterfeiting
expert at attorneys Adams & Adams. |
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New Products
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Country
Fresh Choc Duo Limited edition
The perfect chocolate combination of creamy milk chocolate
and white chocolate is now available in Country Fresh
Ice Cream. This limited edition Country Fresh Choc Duo
2-litre will be highlighted in store with shopper stoppers
and sampling campaigns over the peak summer season. |
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Tropika
2lt pack
The new pack will feature the same trusted fresh Dairy
Fruit Mix formulation, packed in the 2lt pack size with
a 45 day refrigerated shelf life
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New
Tropika Eazy 200ml pouch to meet the consumers needs
Tropika Eazy (UHT Process) in a 200ml pouch with a 6
month ambient shelf life. Available in four tasty current
flavours to stimulate greater purchase frequency. Strong
colour coded impact to draw visual attention to shelf.
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New
Elite Cheese 450g packs
Following the discontinued 500g pack there has been
high consumer demand that a large pack be re-introduced.
Clover has done so with a 450g pack and has been received
extremely well with initial targets easily met
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Brand Activity
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Shake
your Fruitree – a fully integrated Fruitree campaign
Fruitree remains one of the trusted juice brands, being
part of our lives for over 50 years. But it is the Thick
and Fruity taste of Fruitree that make this brand a
favourite in our world. We wanted to shake-up and share
this wonderful brand with as many people as possible,
using the most fun, exciting and dynamic media available
to spread our message. We wanted everyone, everywhere
to “Shake your Fruitree |
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Sip
a cup of Ciro Coffee and support the Pink Drive
Ciro Beverage Solutions (Ciro) has partnered with The
Pink Drive and Protea Hotels to bring you a series of
‘High Coffee’ events this October in order
create further awareness and raise funds for breast
cancer. |
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Tropika
Island of Treasure 4 reality TV show is set to enthrall
SA audiences
Johannesburg, 11th October 2011 – Clover's Tropika,
popular fruit juice brand, launched Tropika Island of
Treasure 4 (TIOT4) in July this year following its previous
three hugely successful seasons. |
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Featured Brands
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Ace
Ace, Kloof and Mona: These are traditional, tried and
trusted coffee mixtures of chicory and coffee. They
are known as “the brands I grew up” and
have become a very big part of the communities within
which they are strong. They have a unique footprint
as they display strength in different regions of South
Africa. |
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Frisco
Frisco has been in the NBL / AVI Beverage Business Unit
for over 10 years. Frisco is a fine powder, not granules,
that quickly dissolves to become light and frothy. Frisco
is the Smooth, Rich & Creamy, Mild Coffee which
can be enjoyed by the whole family. |
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Liquor News
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Pongrácz
comes of age with two gold medals at 21st Veritas Awards
Pongrácz, South Africa’s much loved Méthode
Cap Classique which celebrates its 21st anniversary
this year, received a princely birthday gift of two
Gold medals at the 2011 Veritas Awards. |
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Local
is Lekker at Tapas and Vine
Unwind at the end of the week and enjoy some West Coast
flavours when the Durbanville Hills Eatery hosts Tapas
and Vine on Friday, 21 October, and Friday, 18 November.
Click
here for more Durbanville Hills brand activity |
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KWV
is 2011's Veritas crown prince
KWV has been crowned as the king of Veritas 2011. Last
night (Saturday 8 October) this almost century old wine
and brandy company with its headquarters in Paarl, received
a remarkable five double gold and nine gold medals at
the 2011 Veritas Award ceremony – the most double
gold and gold medals ever won by one cellar.
Click
here for more KWV brand activity |
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Allesverloren
introduces its function and conference venue
The Allesverloren wine estate, about 100 km north-east
of Cape Town in the Swartland’s beautiful Riebeek
Valley, now offers function and conference facilities
for those wanting a genuine getaway that’s easy
to access |
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Roundhouse
chef, Eric Bulpitt's all new Amarula desserts
Chef Eric Bulpitt, who wowed diners at Cape Town’s
Jardine before taking his talents to the Roundhouse
in Camps Bay earlier this year, is fast establishing
a foodie following in his new venue. His original and
very accomplished dishes look set to surpass the spectacular
sweep of the bay.
Click
here for more Amarula brand activity |
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Two
Ocenas, five wines, five teams, more flavours and fun
Some of the Cape’s leading food, drinks and lifestyle
writers met on a beautiful spring day in October to
take up the Cooking and Caring challenge issued by the
Two Oceans wine brand. This involved making a dish with
fish given the green light by the WWF SASSI, (Southern
African Sustainable Seafood Initiative), paired with
a Two Oceans wine).
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Zonnebloem's
new team shines at 2011 Veritas
Zonnebloem’s micro-management of its grapes in
the vineyards and cellar is yielding excellent results,
says global marketing manager for the brand, Deidre
Samson. She was commenting on the cellar’s three
gold and four silver Veritas medals earned at the 2011
SA National Wine Show.
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Golden
reception for Nederburg at 2011 Veritas
Nederburg was showered in gold at the 2011 SA National
Wine Show, winning two double gold and nine gold medals
across the multi-tiered range to maintain its status
as the country’s most awarded winery.
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Cape
Legends scores at Veritas with double gold and gold
Cape Legends, which undertakes the marketing of a number
of leading estates and wineries, came away from the
SA National Wine Show with a double gold and three gold
Veritas medals. |
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Arniston
Bay Wines Get Serious at the 2011 Veritas Awards
Arniston Bay, the easy-drinking lifestyle wine inspired
by the relaxed spirit synonymous with the fishing village
of Arniston, showed its serious side this weekend after
being awarded a bronze medal at the 21st annual Veritas
Awards ceremony.
Click
here more Arniston Bay brand activity |
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Featured Retail
Services
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Ferroprint
(flexographic printing)
Having started from humble beginnings as a pastime (to
keep founders Denis and Eve Ferrow occupied after retiring
from their farm in the Drakensberg), the business has
created a strong foothold in the exacting field of flexographic
printing, and has set the pace for this industry in
South Africa. Today, Ferroprint is easily the biggest
converter of self-adhesive material in Southern Africa. |
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Sachet
Manufacturers (contract packagers)
Sachet Manufacturers, Jacobs, Durban-based contract
packer of foodstuffs, homecare and personal care products.
The business, started in 1995, commenced with packing
personal care products and dry foods into sachets but,
in 2003, acquired preparation, cooking, pasteurising
and retorting equipment, together with various packing
machinery from Robertson's the Alrode plant.
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Retail Services
News
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Primedia
Instore is giving back to the community
As a responsible corporate citizen, Primedia Instore
strives to ensure that it is playing its part in creating
measurable and sustainable improvement to the surrounding
communities in which the company operates, by committing
itself to numerous corporate social initiative (CSI)
projects. |
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Tavern
TV proves a highly effective medium to reach the emerging
black middle class
Which brand would not want to captivate a market that
holds over 40% of spending power in South Africa? One
Digital Media’s recent study shows that their
Tavern TV network manages to do just that, and it does
it very successfully. |
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Imperial
Logistics and GIBS launch Programme of Excellence
Top-ranked business school, The Gordon Institute of
Business Science (GIBS) and IMPERIAL Logistics, a global
leader in logistics and supply chain management, have
launched their Supply Chain Management and Logistics
Programme of Excellence. |
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Imperial
Logistics awarded two PMR Diamond Arrows
IMPERIAL Logistics has received two Diamond Arrow Awards
at the 2011 Professional Management Review (PMR) Awards.
PMR.africa has conducted its annual, national survey
on FMCG Supply Chain Management Companies in South Africa.
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Zetes
Announces Premier Partnership with Motorola Solutions
in South Africa
Zetes (formerly ProScan), has announced its new premier
partner status with Motorola Solutions in South Africa,
following the recent acquisition of the ProScan Group
by Zetes Industries, a leading pan-European company
specialising in automatic identification solutions and
services for goods and people. |
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Events
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UCT
Unilever launches massive study into ‘top end’
consumers
When: 11 Oct 2011 – 14 Oct 2011
Venue: Various. This event will be held in Durban, Cape
Town and Johannesburg. |
Robertson
Wine on the River
When: 14 Oct 2011 – 16 Oct 2011
Venue: Robertson |
SOCAP
SA 2011 Conference
When: 3 Nov 2011 – 4 Nov 2011 |
New
dairy experience come to the Cape
When: 4 Nov 2011 – 5 Nov 2011
Venue: Sandringham (next to the N1 between Cape Town
and Paarl) |
Food
Safety Conference
When: 21 Nov 2011– 24 Nov 2011
Venue: The Crowne Plaza, Johannesburg |
Global
Sources: China Sourcing Fairs
When: 30 Nov 2011 – 2 Dec 2011
Venue: Gallagher Convention Centre, Midrand, Johannesburg
· Global
Sources, Baby & Children's Products China Sourcing
Fair
· Global
Sources, Hardware & Building Materials China Sourcing
Fair
· Global
Sources, Garments and Textiles China Sourcing Fair
· Global
Sources, Gifts & Premiums China Sourcing Fair
· Global
Sources, Home Products China Sourcing Fair
· Global
Sources, Solar & Energy Saving Products China Sourcing
Fair
· Global
Sources, Electronics China Sourcing Sourcing Fair
· Global
Sources, Fashion Accessories China Sourcing Fair |
Networking
expo for the logistics and supply chain management industry
When: 22 Mar 2012 – 23 March 2012
Venue: Gallagher Convention Centre, Midrand, Johannesburg
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Cards
& Payments Solutions - even bigger and better for
2012
When: 13 Mar 2011 – 14 Oct 2011
Venue: Earls Court, South Hall, London
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Featured Client
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Active Clients
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