Judith Kolenburg takes us behind the scenes at the judging event “International Salute to Excellence”. In other news, Hans Kraak reports on a new trend among grocery stores.
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What are today’s design trends? To find out, PLMALive speaks with Melvin Fahl, Chief Strategy Officer at WIN Creating Images & WIN NEO.
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PLMA E-Scanner – May 2022

May, 2022
Lidl acquires its own container ships

In view of continuing disrupted supply chains, Lidl will use its own container ships for freight forwarding. It has bought one ship and chartered three others. The ships are to help reduce delays and temper transport costs. It has appointed an experienced shipping manager to head the new division.

Due to Covid, the Suez Canal blockage, and the war in Ukraine, foremost among today’s challenges for retailers is the reliable flow of products from source to shelf, product availability, continuity and on-time delivery. In addition, personnel shortages are pushing up labor costs.

With its own shipping capacity, Lidl looks to secure the supply chain and manage the increased volume of different production facilities more flexibly in the long term. It is not the first investment of the company outside of its core retail business. Lidl’s mother company Schwarz also owns waste management company Prezero, through which it controls the entire packaging recycling cycle. In addition, Schwarz bought a major stake in IT security provider XM Cyber, which protects the retailer’s IT systems.

Is refill a new trend in retail?

In an attempt to reduce waste and packaging, several retailers in Europe are experimenting with in-store packaging free concepts. A wall or corner with bulk food dispensers is installed where consumers can fill a reusable bag or jar with the amount of product they wish.

Albert Heijn recently installed a special six-meter wall with dispensers with 70 products such as breakfast cereals, rice, pasta, spreads, tea and nuts. Eighty percent of the range is organic. Signs at the regular range indicate an option to buy the products without packaging.

In the United Kingdom, a group of supermarkets including M&S, Morrisons and Waitrose have joined the “Refill Coalition”, a trial to tackle single use plastic packaging. The coalition is to design a refill solution for products such as pasta, grains and personal care items. The solution is unique in that it also makes bulk products available for online orders, it will allow shoppers refill their own containers during home deliveries.

Aldi also offers customers household staples free of packaging. Customers can bring their own containers to the store, weigh the desired amount of product at the weighing station, and then fill their container.

The French government’s new Climate and Resilience Bill provides that by 2030, 20% of the floor surface of stores larger than 400 square meters must be adapted with refill systems.

Until now, the emphasis in reducing packaging waste has been on recycled packaging.  Now the focus is shifting to refillables, but there are logistical challenges. In-store refillable aisles take up a lot of space, it calls for an investment from retailers to install dispenser stations and the stations must be regularly filled and cleaned. The question is whether these models can be integrated seamlessly into the shopping experience and become a mass-market option.

Goodbye liquids, hello solids in health and beauty

Solid products are on the rise in the health and beauty market. Products include soap, shampoo, facial cleaners, conditioners, make-up removers and more. In response to growing consumers’ concern with sustainability and naturalness, more and more retailers are offering solid alternatives to liquid products.

Solid products have various advantages. First, they contain no water, are zero waste and replace plastic bottles and are, thus, a perfect fit for a more responsible beauty routine. In addition, they respond to the need of consumers for more natural and authentic products, and they are often vegan. Solid products are also practical, their fixed shape make them easy to take with you on-the-go or while travelling.

Carrefour recently launched its own range of solid products under the Carrefour Soft Green private label in Belgium. The range includes shampoos, soap and deodorants. One shampoo bar can be used for fifty to one hundred washes, the equivalent of two classic plastic bottles of liquid shampoo. The deodorants come in 100% recyclable packaging.

In France, Monoprix has developed a private label range of organic solid personal care products as part of wider efforts to expand its natural and responsible beauty offerings. Under the own brand BIO, the range features toothpaste, soaps, deodorants and shampoo. All products are Ecocert certified and carry the CosmeBio label, made with at least 98% ingredients of natural origin. In addition, the items are eco-packed in paper, cardboard or metal boxes, and are made in France.

While the market for solid products is still small, product ranges are rising, and with more bars on the shelf, visibility increases and sales of ‘Green beauty’ is expected to grow.

Casino converts 25% of its hypermarkets

Casino has been transforming its loss-making hypermarket network. Ten years ago, it had 125 Géant Casino stores in France. A few months ago, only eighty stores remained and in the coming weeks, twenty of these are to switch and become Casino supermarkets.

For years, the retailer has been working on its hypermarkets, including disposals,  
reductions in surface area, or transfers. The chain has seen a decline in its hypermarket business and says it will focus more on convenience and e-commerce formats.

Price war in the UK

To tackle the cost-of-living crisis, major retailers in the UK have recently announced massive price cuts and investments in own brand value ranges. Asda is putting £73m in dropping and locking the prices of more than a hundred products. In addition, it invested £45m in developing a new private label budget range called Just Essentials by Asda. Morrisons launched one of the biggest price cuts of the company with the reduction of prices of over five hundred items.

The cuts include part of its entry-level own brand products under the Morrisons Savers, Morrisons Wonky and Morrisons Essentials label. In addition, it introduced a new price comparison mechanism to convince consumers to switch from brands to private label.

Health and beauty retailer Superdrug is freezing the prices of over one hundred everyday essentials in the personal care, beauty, and healthcare categories for at least one year. Upmarket grocer Marks & Spencer is investing heavily in its value range Remarksable, it lowered prices for everyday staples such as milk, pasta, bread and bananas.

To qualify as Re-Marks-able value, each featured product has been price benchmarked against key competitors and must also uphold M&S’ quality point of difference. It also launched a Family Dine In offer with regularly changing menus spanning a range of global-inspired cuisines. Finally, M&S introduced Bigger Pack Better Value choices for customers with on average a 10% saving across fridge essentials and cupboard family favorites.

In the Stores 

Zooroyal, Rewe’s online pet food and care subsidiary has opened its first brick & mortar store in Germany. The store offers a range of more than 12,000 SKUs, it includes an aquarium department with underwater world and an integrated digital animal brokerage exchange and on-site services like an external dog washing station, a dog stylist and a veterinary pharmacy.

Morrisons has launched a range of premium fresh British meat cuts and added-value products under its own brand The Best Gourmet Collection designed to offer shoppers the flavour of top restaurants at home for less.

Covirán introduces smart shopping carts in its supermarkets that allow customers to shop without having to go through traditional checkouts. A device installed in the cart scans, weighs and detects all products put in the cart and automatically adds them to the client’s account.

Dm drugstore chain has opened its first store in Poland, the retailer’s 14th country in Europe. In this new country, it will come across its strongest rival in Germany, Rossmann.

Co-op is scrapping the use by dates on all private label yoghurts to encourage customers to use their own judgement to establish the suitability to consume.

Casino stores are deploying a seasonality barometer colour coded display in the fruits and vegetables department to help customers develop a better knowledge of when a product is high season, off-season, early or late season.

Spar and Thuisbezorgd.nl are conducting a pilot to deliver groceries to home quickly in addition to food service items, such as sandwiches and drinks. Customers can choose among a range of more than 1,000 products from bread, milk and other fresh ingredients to toiletries and other last-minute necessities.

Lidl lets its customers get a look behind the scenes through a cooperation with social media influencers. The latter will get an insight into processes like manufacture of products, recycling processes, quality management and in-store operations and are supposed to report on their impressions via social media.

Carrefour Bio is the first retailer in France to implement blockchain technology to its own-brand organic products. Customers can access the entire life cycle of the product by scanning a QR code on the label.

Edeka is adding the new Naturkind own brand to its range. Naturkind consists of 60 items from 100% organic farming, and will be integrated into the product range of the Edeka and Netto stores. It includes products from fruit and vegetables, frozen, bread, to natural cosmetics.

Lidl incorporates its Cien Bio private label cosmetic line into its permanent offer, until now, the items were only seasonally on the company’s shelves. The line is offered in 100% recyclable packaging made with 96% vegan ingredients.

Selex aims to achieve private label growth of +5% by the end of this year. Research, comparisons, tests on the private label offer are on the agenda for the second retailer in Italy. The programme involves extensive testing and evaluating by a large number of consumers, from basic brands, to specialist lines to fancy brands.

Carrefour Spain launches an exclusive edition of the Monopoly game to its customers. The game is dedicated to food has 28 cards in which products or measures related to healthy eating and sustainability have been included.

Aldi uses a Channel 4 reality series to recruit new British suppliers. ‘Grow with Aldi’ is to be a six-part series, with a winner from each hour-long episode awarded a contract to supply the discounter’s 950 UK stores.

Market Research 
State of Grocery Retail 2022

McKinsey and EuroCommerce have published a report on The State of Grocery Retail 2022.’ It’s based on interviews with 60 European grocery CEOs and a survey of more than 12,000 consumers across nine European countries.

It reveals that, in the short term, the impact of the invasion of Ukraine as well as inflation and energy costs are top of mind for CEOs, putting even stronger pressure on prices and operational efficiency, along with the wellbeing of employees.

Future trading will feature increased margin pressure on grocery retailers, the report warns, with the need to cater for broader consumer demands, growing price pressure and increasing multi-channel complexity.

Changes in consumer demand with regard to product attributes and purchase channel and more insights and perspectives that will likely shape European grocery retail in 2022 and beyond will be discussed by McKinsey at PLMA’s pre-trade show seminars on Monday 30 May.

Food innovation: Pleasure, health and ethics are winners

French consultancy ProtéinesXTC has analyzed innovative products launched in the world in 2021. According to the study, the first axis of food innovation remains ‘Pleasure’, innovations with this claim represent 47.8% of the global innovations identified by the study in 2021, i.e. nearly one in two innovations.

The ‘Health’ attribute comes in second with over 30% of food innovations. Third important axis is ‘Ethics’, this attribute has been increasing continuously for 5 years and now represents 7.9% of innovations worldwide, with the highest share in Europe (one in ten).

PLMA News 
Pre-trade show seminar programme announced

Prior to PLMA’s “World of Private Label international trade show, which will be held from 31 May-1 June at the RAI Exhibition Centre in Amsterdam, there will be a special seminar programme on Monday 30 May from 14h–16h at the RAI’s Forum room.

Nielsen will give an overview of the latest private label, country-by-country market share data and trends. McKinsey will present new insights and perspectives that will likely shape European grocery retail in 2022 and beyond from its recent ‘State of Grocery Europe: Navigating the Market Headwinds’ report. The winners of PLMA’s Salute to Excellence awards will be announced and there will be a presentation of the findings of PLMA’s new international consumer survey ‘Will Europeans ever shop the same: assessing consumers’ post-pandemic behaviour’.

Events 
31 May & 1 June

PLMA's “World of Private Label” International Trade Show

26-27 October

PLMA’s Executive Education Programme