In Ukraine, there are fewer and fewer new grocery shops, “Segodnya” writes with reference to the research of GT Partners Ukraine.
During the first half of 2017, 229 new outlets appeared in the country, and in the same period of this year, there were only 201.
Back in July, Igor Guglya, the head of GT Partners Ukraine, predicted that by the end of the year 500 shops would appear in Ukraine, although in 2017 they opened 511.
Then experts explained this trend by the growth of rental rates for the last year by 10-15% and saturation of the food retail market. In addition, the purchasing power of the population is declining.
Today, analysts tell about a steady trend of slowing the development of food retail in Ukraine. According to Guglya, in the first half of the year 2018, the food networks opened 201 outlets, and 160 of them were brand new, the rest of them just replaced the signboard as a result of rebranding or acquisitions.
Moreover, fewer stores are opened by the leaders of the network food retail, despite their market advantages. Experts explain this in addition to these reasons, the deficit of large areas for shops.
The downward trend is also corrected by the trend of “monopolization”: when dozens of small retail outlets disappear, and in their place, one large store opens.
Networks began to expand into rural areas, where rental prices are lower than in cities, experts say. There, this tendency is moving towards confrontation, the decline in the purchasing power of Ukrainians.
Even if it gradually grows by 2-4%, this percentage will not allow “to open new outlets under such sluggish economic growth,” sums up Alexey Doroshenko, director of the Ukrainian Association of Trade Network Suppliers.
Against this background, competition between food retailers is exacerbated: as we wrote earlier, they are beginning to change formats, improve business processes in order to keep buyers. In addition, networks are increasingly using franchise as a method to reduce their costs.