Retail Update - powered by LebensmittelZeitung
Retail Update - powered by LebensmittelZeitung
Wednesday, 01 February 2017

Hello, dear reader!
The war of the US retail giants is taking another turn. Big-box retailer Walmart makes its free two-day delivery service for members available to all its customers. Rival Amazon invests more than one billion dollars to build an air hub in Kentucky to support its fast deliveries. Read about the competitive strategies of these two companies and have a great start to the day.

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South Pacific
Aldi continues to expand   The German discounter is about to grow its operation in Western Australia, where it plans to open 14 stores this year, creating 350 jobs and taking its total number of stores in the arid outback to 33. The move will fuel yet again the ongoing battle for diminishing shopper dollars.  ▪
Notifications from New Zealand   Heineken-owned DB Breweries has bought Kapiti-based craft beer brewer Tuatara Brewing for an undisclosed sum. Meanwhile, Michael Spaans, director at dairy giant Fonterra, has stepped down from the board due to ill health and has been replaced by Ian Farrelly, who had retired from the role just last month.  ▪
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EUROPE
Ocado on the rise   The British online grocer has posted a robust sales increase for 2016, reaching a total of GBP 1.27 billion and says it is busy having talks with potential overseas clients. The company is also keen on experimenting with robots in partnership with academic institutions in Germany, Italy and Austria. ▪
Healthy results   Russian retail chain O'Key Group posted a 7.6% year-on-year increase in sales compared to last year. It's discount banner DA! experienced the most growth. Meanwhile, French luxury goods company LVMH enjoys record revenue and profits for 2016, thanks to strong sales in the US and Europe. ▪
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Morrisons buys plant   The British supermarket operator has announced the acquisition of Farmcare’s potato packhouse in Scotland, as part of a supply agreement. The company controls 40,000 acres of land in the UK, where it grows fruit, vegetables and potatoes.  ▪
USA & LATIN AMERICA
Optimising delivery options   Walmart counters Amazon Prime with the decision to end its two-day delivery service for members in favour of free-shipping for orders that hit a US$ 35 price threshold. Meanwhile, its Seattle-based rival supports its growing fleet of planes by building a new air hub near Cincinnati, investing US$ 1.49 billion into the project.  ▪
Killer quarter for Apple   The US tech company returned to its winning ways and beat analysts' expectations thanks to record iPhone sales. Revenues rose to US$ 75.9 billion in Q1, which marks a turnaround from the last quarter, when the company reported its first drop in revenue and profit in 15 years. ▪
High and low expectations   Citing improved regional economic prospects, Chile-headquartered retailer Cencosud anticipates consolidated sales of US$ 16.5 billion this year. The company plans to increase its online growth. The growth forecast for Brazilian supermarkets is not that rosy, as sales volumes fell 4.7% in the first 11 months of last year. ▪
AFRICA
Developments in Kenya   French retailer Carrefour has extended its delivery network to suburban Nairobi. Shoppers will pay more for the service if they are situated further out from the city. Supermarket operator Uchumi says that its net loss has narrowed to US$ 25.7 million, after having closed some outlets and selling assets. ▪
Negotiations in Jo'burg   South African retail giants Steinhoff and Shoprite say that they continue to have exclusive talks about a possible merger. This follows the announcement in December that the companies were planning to create an entity called Retail Africa. ▪

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