French food retailer Casino is eyeing up a large slice of the convenience market, as it looks to treble its Leader Price discount stores by the year 2010.
France's Casino plans to boost its network of Leader Price outlets to a total of 1 300.
UK research group IGD, in its latest report, says the Leader Price format is likely to achieve a 16% compound growth rate between 2001 and 2005.
FAST GROWING
Leader Price is Casino's fastest growing format, but also generates its best profit margin, 7% compared to 3.9% for the group as a whole.
Its almost 3 000 private label products which are between 30% to 40% cheaper than the supermarkets.
The Leader Price network stood at 400 at the end of 2001, but IGD forecasts this to rise by another 900 over the next eight years.
FRANCHISES
Franchises are expected to play a major role in this development. In its two key markets, France and Poland, franchises represent around one third of the store network.
IGD's international programme manager Louise Spillard said, "Casino has aggressive development plans for Leader Price, both in France and internationally. It plans to roll out 20 new stores a year in France until it reaches its target of 600.
Spillard continued, "It has a strong bias towards smaller stores which cater to consumers' growing need for convenience, in fact 71% of its operating profit is currently generated by what it calls `convenience formats' including supermarkets, convenience stores and discount stores such as Leader Price."
COPYRIGHT 2002 Agra Europe Ltd.
COPYRIGHT 2003 Gale Group
