Country Presentation Serbia - PowerPoint PPT Presentation

1 / 31
About This Presentation
Title:

Country Presentation Serbia

Description:

... Mini Maxi (convenience), Maxi (supermarkets) and Super Maxi (hypermarkets) ... C Market is considering diversifying into a hypermarket format. ... – PowerPoint PPT presentation

Number of Views:1070
Avg rating:3.0/5.0
Slides: 32
Provided by: igd9
Category:

less

Transcript and Presenter's Notes

Title: Country Presentation Serbia


1
Country Presentation Serbia
Updated November 2007
2
Contents
  • Retailers covered include
  • Map
  • Demographics
  • Political Outlook
  • Economic Overview
  • The Retail Market
  • Europanel Data
  • Top 10 Retailers
  • Challenges and Opportunities

3
Summary
  • Area 102,170 sq. km
  • Capital City Belgrade
  • National Currency Dinar
  • Population (2006)8.17 million inhabitants
  • Population Density 80 people/km
  • President Boris Tadic
  • Ruling PartyDemocratic Party of Serbia
  • Prime Minister Vojislav Kostunica

Source CIA
4
Demography 10 most populated Cities
Source City Population, 2002
5
Demographics
Population Growth Forecast (000s) Serbia
Montenegro
Population Split by Age, 2006 ()
www.igd.com/analysis/datacentre
Source IGD Datacentre, 2006, UN
6
Political Outlook
  • The Socialist Federal Republic of Yugoslavia
    broke up in 1991/1992 following the independence
    of Slovenia, Croatia, Bosnia and Herzegovina, and
    Macedonia. Two remaining republics of Yugoslavia,
    Serbia and Montenegro, formed in 1992 a new
    federation named Federal Republic of Yugoslavia
    (In 2003 this state was transformed into the
    State Union of Serbia and Montenegro).
  • The Government of Serbia and new Yugoslavia
    supported Croatian and Bosnian Serbs in the wars
    from 1991 to 1995. During this time, the country
    was under economical and political sanctions,
    which resulted in economical disaster that forced
    thousands of young Serbian citizens to emigrate
    from the country.
  • Serbia declared its independence on June 5 2006,
    following Montenegro's declaration the previous
    month. This marked the final dissolution of the
    State Union of Serbia and Montenegro, and the
    re-emergence of Serbia as an independent state,
    under its own name, for the first time since
    1918.
  • Fiercely independent and recovering from
    political turmoil, Serbia is now working towards
    EU membership, although problems concerning war
    crimes have halted proceedings.
  • The country is supported by international
    agencies with funds directed at developing
    frameworks within which civil society
    organisations can develop.

7
Economic Overview
www.igd.com/analysis/datacentre
Source IGD Datacentre estimates, Unicredit, IMF
8
Grocery Retail Market Sizes 2007e
Top 10 Global Markets
Top 10 Eastern European Markets
www.igd.com/analysis/datacentre
Source IGD Datacentre estimates
9
The Retail Market
Source IGD Datacentre estimates
www.igd.com/analysis/datacentre
  • IGD Grocery Retail Market corresponds to the
    total annual turnover (excluding VAT) of retail
    outlets predominantly selling food. It includes
    the sales of non-food articles (i.e. health
    beauty, pet care, clothing, DIY etc) sold by
    hypermarkets, supermarkets, discounters,
    neighborhood stores, specialised food stores
    (bakeries, butchers, etc) and open markets. It
    excludes all cash carry, delivered wholesale,
    foodservice and drugstores/chemists.
  • IGD Total Grocery Market includes is a wider
    definition of the grocery universe and is the sum
    of the grocery retail market and the cash and
    carry outlets.

10
Retail Consumer Spend Per Capita Serbia
Source IGD Datacentre
www.igd.com/analysis/datacentre
11
Retail Legislation
  • New custom and tax laws have reduced illegal
    imports into the country, but corruption and the
    black market remain a major problem.
  • The state retains discretionary authority over
    price changes of basic grocery goods, including
    milk, bread and cooking oil.
  • The Law on Trade regulates the activities of
    wholesalers and retailers. Wholesalers act as a
    distribution intermediary for retailers.
  • Franchise operations are not widely practiced,
    although there is no specific law affecting them.
  • Joint ventures are ruled by the Foreign
    Investment Law (2002). International investors
    are expected to provide capital, equipment and
    merchandise, whilst domestic investors provide
    personnel, warehouse space and channels for
    distribution.
  • On September 24 2005, the new Competition
    Protection Law (CPL) took effect in Serbia. The
    competition law regulates instances where
  • control over all or a part of one or more
    enterprises is acquired by another enterprise (a
    concentration)
  • there is an agreement between parties that would
    materially prevent, restrict or distort
    competition on the Serbian market
  • there is abuse of a dominant position on the
    market.

12
The Grocery Retail Market Format Development
Source IGD
13
The Grocery Retail Market Structure By Format
  • Traditional retail formats dominate the grocery
    sector, with approximately 30,000 independent
    stores operating the country.
  • Modern retail development is focused in Belgrade
    and other large cities, with cash carry formats
    first represented by Delta Ms first Tempo store
    in 2004 and Metro in 2005.
  • The discount sector is undeveloped in the
    country, providing an opportunity for
    international discounters to capitalise on the
    price-sensitive Serbian consumers.
  • Foreign investment laws, adopted in 2004, have
    proved beneficial to investors. It has given
    investors the right of free profit repatriation,
    duty free equipment imports and simplifies the
    employment procedure.

14
Breakdown of Shoppers by Housewife Age (Europanel
Data)
of buyers
52 w/e December 06
15
Breakdown of Shoppers by Household Size
(Europanel Data)
of buyers
52 w/e December 06
16
Breakdown of Shoppers by Presence of Children
(Europanel Data)
of buyers
52 w/e December 06
17
Market Share
Note Grocery data. Total may not add up to 100
due to rounding. Bracketed figures 2005 data

18
Top Retailers 2006
Grocery Retail Market Shares excludes cash
carry operations. Data is for grocery formats
only except Total Sales which includes
non-grocery if applicable.
Source IGD Datacentre, Company Reports
19
  • Serbian conglomerate Delta Holding operates four
    retail chains under its Delta M subsidiary
  • Maxi supermarkets
  • C-Market- supermarkets (51 stake acquired in
    2005).
  • Pekabeta convenience stores
  • Tempo cash carry

Key C/F Convenience Forecourt, CC Cash
Carry, S/S Superstore/Supermarket, HHypermarket
Source IGD estimates, 2006.
20
  • Maxi operates under three banners Mini Maxi
    (convenience), Maxi (supermarkets) and Super Maxi
    (hypermarkets). It also operates shopping
    centres.
  • Sales areas range between 500 sqm and 3,000 sqm
    and stores offer an average of 8,000 SKUs. It
    operated approximately 80 stores in 2006.
  • Delta M plans to invest 700m by 2009 with the
    expansion of Maxi into Montenegro and Macedonia.
  • Pekabeta is Delta Ms convenience store format.
  • The retailer currently operates approximately 160
    stores, mainly in Belgrade.
  • The stores have an average sales area of 200sqm
    and offer between 3,500 and 7,500 SKUs.
  • Expansion planned into the densely populated
    urban areas around Serbias main cities and towns.

21
  • C Market was acquired by Delta M in 2005.
  • The retailer currently operates approximately 250
    supermarkets. 60 of the chains turnover comes
    from its Belgrade stores.
  • C Market is considering diversifying into a
    hypermarket format.
  • It has also been reported that it is considering
    acquiring fellow Serbian retailer Si-Market.
  • Delta M opened its first cash carry store in
    2004. It currently operates one store in
    Belgrade.
  • The store has a sales space of 10,000sqm and
    offers 20,000 SKUs.
  • Further expansion of the chain, with stores
    planned in Novi Sad, Belgrade, Kragujevac and Nis.

22
Delta M Delta Agrokor merger
  • In November 2006, it was reported in the Serbian
    press that domestic conglomerate Delta Holding
    and Agrokor, owners of Croatian retailer Konzum,
    had started the merger process between their
    retail divisions.
  • The collaboration will strengthen the retailers'
    positions in Eastern Europe and enable access of
    Serbian goods onto the Croatian market and vice
    versa. The merger is likely to be completed in
    2008.
  • Delta M has reportedly forecast sales of 5bn in
    2009 when it plans to float the merged company on
    the London Stock Exchange.
  • The collaboration between Agrokor and Delta M
    will result in strong competition for Slovenian
    retailer Mercator, who challenged Delta M's
    leading position with its joint-venture with
    Serbian chain Rodic MB in May 2006.
  • The Mercator-Rodic alliance came amidst rumours
    that Delta M was planning a hostile takeover of
    the Slovenian chain, and recent press reports
    suggest that Mercator had been considered as a
    potential third party in the Agrokor-Delta M
    collaboration.

23
  • In April 2006, Rodic negotiated a joint-venture
    with Slovenian retailer Mercator.
  • Rodic MB became a co-owner of Mercators
    Slovenian stores and Mercator acquired Rodics
    Serbian stores.
  • The new joint-companies, named M-Rodic in Serbia,
    are operated centrally from a single
    headquarters. New trade centres are planned in
    Novi Beograd and Novi Sad.

Key S/S Superstore/Supermarket
Source IGD, 2006 estimates. Total sales are Net.
24
  • Metro entered the Serbian market in January 2005.
    It opened two new cash carry stores in the
    country in 2006.
  • In 2006, turnover increased 97 from 69m to
    136m, making it one of Metro's fastest growing
    markets.
  • The company plans to have eight to 10 stores in
    Serbia over the next three years.

Key CC Cash Carry
www.igd.com/analysis/datacentre
25
  • Simpo is a production company with interests in
    furniture, food beverages, trade
    transportation.
  • It established its food retail subsidiary in 1997
    through a merger with PC Vema.
  • Simpo currently operates approximately 85
    Si-Market stores in Vranje and 90 in Belgrade and
    Pancevo.
  • It has been speculated that Delta Holdings C
    Market subsidiary is considering acquiring the
    chain.

Source IGD 2006 estimates.
Key S/S Superstore/Supermarket
26
  • Vero is owned by Greek company Veropoulos.
  • It entered the Serbian market in 2002 and
    currently operates 3 hypermarkets, under the
    Super Vero fascia, in Belgrade.
  • It plans to invest 20m euro in 5 Serbian
    hypermarkets by 2008.

Source IGD estimates 2006.
Key H Hypermarket
27
  • Mercator entered the Serbia Montenegro market
    in 2002 with the opening of a hypermarket in
    Belgrade.
  • In September 2006, Mercator received a 40m loan
    from the IFC to fund its Bosnia-Herzegovina and
    Serbian expansion plans.
  • In April 2006, Mercator entered a joint-venture
    with Serbian retailer Rodic MB.
  • Rodic MB became a co-owner of Mercators
    Slovenian stores and Mercator acquired Rodics
    Serbian stores.
  • The group plans to invest 200m in expansion in
    Serbia  Montenegro by 2008.

Key H Hypermarket, SSupermarket,
C/FConvenience Forecourt
Source IGD 2006. Total Sales are Net.
28
  • Intermarchés entry into the Serbian market in
    2004 formed part of the groups move eastwards
    and followed previous entries into Bosnia
    and Romania. 
  • ITM plans to operate 11 stores in Serbia over
    time and aims to make Belgrade the centre of its
    southeast European region. Future developments
    include expansion into Bulgaria and Macedonia.

Source IGD Datacentre estimates, 2006.
Key S/S Superstore/Supermarket
29
Challenges and Opportunities
  • Serbia remains one of the poorest CEE market.
    Furthermore, political uncertainty has hampered
    economic development and will remain a challenge
    until a clear programme for EU accession can be
    agreed.
  • The potential EU accession does, however,
    highlight that the country has strong growth
    prospects.
  • High inflation and unemployment undermines
    business and investor confidence. The government
    tackling FDI by creating a one-stop-shop for
    investors to reduce bureaucracy and corruption.
  • Delta Holding is the clear market leader making
    it difficult for foreign retailers to enter the
    country through acquisition.
  • Mercator and Rodics joint-venture has provided a
    strong challenger to Delta Holding and will
    provide opportunities for suppliers seeking to
    grow their business in the country.

30
Market Share Definitions
  • IGD Market Shares
  • IGD defines the grocery retail market as all
    food, drink and non-food products (i.e. health
    beauty, pet care, clothing, DIY, tobacco etc)
    sold through all retail outlets selling
    predominantly food in a given country. This
    definition includes modern retail formats such
    supermarkets and hypermarkets as well as
    traditional retail formats such as open air
    markets and traditional food stores such as
    bakers. However, it excludes cash carry and
    drugstores.
  • IGD Market sizes are derived from national
    statistical sites wherever possible. In all other
    cases, the figures published in this report
    represent IGD estimates and are based on a
    consistent methodology and knowledge of local
    markets.
  • For each retailer, the turnover used is total
    grocery (rather than total company), and
    therefore excludes non-food formats (such as DIY,
    electrical stores, department stores etc). IGD
    also excludes cash carry formats and retailers
    and drugstores / chemists from this measure to
    ensure a consistent market share figure.
    Therefore these shares are based on IGD Grocery
    Retail Market Sizes.
  • 1.Retail turnover is excluding VAT
  • 2.Retail turnover is excluding non-food formats
    (e.g. furniture, electrical stores etc)
  • 3.Metro cash carry operations are excluded
  • 4.Where known, we have subtracted the cash
    carry operations of players such as Carrefour and
    Rewe to use a pure grocery retail estimate of
    turnover.
  • IGDs market shares differ from ACNielsen or TNS
    data due to the different methodologies applied
    to calculate the market shares (till roll data
    and customer panel information respectively
    from limited categories).
  • Europanel Data
  • Europanel market shares are based on purchases
    made by private households, and cover the
    purchasing of fmcg products bought in all outlets
    even if they do not sell primarily food
    (e.g. pharmacies).
  • In many countries, the definition excludes large
    items bought in hypermarkets (e.g. television,
    washing machine).
  • It does not cover Cash Carry (except where
    private households buy directly from them),
    institutions who may buy some of their products
    from retail outlets (e.g. hospitals, schools etc)
    and purchases made for out of home consumption
    (e.g. caterers, offices etc).

31
For More Information
  • Visit the Serbia hubpage on Retail Analysis.
  • Use the IGD Datacentre for key macroeconomic data
    on Serbia, plus statistics on retailers
    operations by banner and format.
  • Got an iReports subscription? Try checking our
    International Research reports.
  • To find out how an IGD Customised Briefing can
    bring you up to speed on the market and the key
    players, email nick.everitt_at_igd.com
  • Still cant find what youre looking for?
    Contact us igd_at_igd.com or 01923 857141.
Write a Comment
User Comments (0)
About PowerShow.com