Real chief says own brand is the way ahead

l
uH'r
t
Brands
Do you buy store brands. (ones owned
by the chain store se*ing them)
when food shopping? Why?
lWhy not?
Reading
Read this article from the Financìol
Times andanswer the guestions.
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Real chief says own brand is the way
ahead
by Gerrit Wiesmann in
Germany
Neuss,
Joèl Saveuse walks across the Real
hypermarket in northern Germany
s
in search of.those iittle biscuits,.
Moving from toys to the freezer
section, the 55-year_old, who runs
thecountry's biggest food retailer,
finds what he is looking for in
aisle 45. .This is my iavourite
.rs
'I ook. here's a simple picture of
Together
cent now.
by replacing its different in_housé
zo brands with a single orvn
brand
that links the retailer rvith a product
range. The aim is to raise in_house
brand sales frgl I 5 per cenr up
ro
25 per cent offood sales in trvò
to
zs three years'time. Mr Sav.ur"
ruy,
that customers get top quality flr
at Ieast I5 per cent less-thanihey
would pay for a name brand _ anà
is
aiming for a
quora, up froÀ 25 per
. A{r.r. working on the concept
for the last year,
Real introducÉd
.o 850 Real euality irems this
September - coincitlental but
with a
handful" of
rivals, the Frencirman is star.ting
a small revolution in German!
and Carrefour
3O-per-cenr
product,' Mr Saveuse says,
io holding a packet of chocolaL_
fiìled Mini Double Biscuits.
the contents,'he says as his finger
moye: across the packaging, ,and
rs top left is the..Real quality.;logo.,
Real gets- a better profit margin.
Such logic has seen Èeal,s
foreign rivals push true own_brand
Iines for decades. Real reckons up
to 60 per cent of Tesco,s UK sales
come from its three Tesco brands,
30
rs
'absolutely perfect timing' for
the
economic downturn that iollowed
the banking crisis, the Real head
f"ays.
Although Mr Saveuse
says
that shopping habits at Real have
not yet been affected by economic
tvoes, he stresses that next year
5,r
could see shoppers buying more
own brands as they look foi more
value lor mone),. .Crisis doesn.t
just bring.disadvantages.' he
says.
Civen the power of own brands
, good
rn
times and bad. it
is
ss surprising that German retailers
only launched distinctive
last year. The
cause
Germany's porverful discounters.
AIdi and Lidl have in the past
rn generation helped corner 40 per
cent of the food retail market
-
as against 6 per cent in the
UK - by selling liftle else than
a small range of own brancls,
65 a move copied by Real, with, say,
its lorv-cost .Tip, range.
'But we,re intemationalising
now,'Mr Saveuse says. .In polanà
and. Turkey, we're competing
;o against Carefour and f.r.o]
in Russia and Romania againsi
Carrefour * that has forcJd us
to focus on true own_brand as a
liray of building our presence.,
rs Strengthening
the Real brand
is key to reviving the chain. A
19"T, held back by discounters,
Mr Saveuse reckons the German
hypermarket has a fuiure. He
m should know. Until 2005, he
rvas second-in_command at
hypermarket pioneer Carrefour.
lines
11,4
@ Pearson Education Limited
2010 pHorocoptABr.E
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