The French government is currently discussing legislation that will favour hard discount retailers. The new law will ease restrictions on new store openings for retail surfaces between 300m² and 1,000m² - the core of the hard discount market. In 2007, hard discount was granted 25% of new food and household store opening authorisations, versus 40% for supermarkets and 35% for hypermarkets. This looks set to reverse over the next 18 months. The Mousquetaires group, owner of the Intermarché hypermarket chain and the hard discounter ‘Netto’, has already announced plans to double the number of hard discount stores.
The concept of hard discount retailing was introduced to France in 1988 by the two German leaders, Lidl and Aldi. By 1992, their market share was just 1.6% but it grew rapidly over the following 10 years to reach 10.5%. Since then, however, growth has been harder to achieve, in part because of the difficulties of getting new store opening authorisations. Today hard discount represents just 13.7% of the retail sector, or 8.1% of French household spending - significantly lower than most other European markets. In Germany, for example, hard discount enjoys a 35% market share.
Market Share (2003)
Supermarkets
34.90%
Hypermarkets
51.40%
Hard Discount
12.40%
Other
1.30%
In 2007, Lidl was the dominant hard discount player in France with 1,263 outlets versus 820 for Ed (Carrefour group), 688 for world leader Aldi, 425 for Leader-Price (Casino group) and 325 for Netto (Intermarche group). Two new entrants to the market in 2006/07 were the Auchan group with Les Halles d’Auchan (4 outlets) and Casino with Geant Discount and Discount Club. The average store size for a hard discount outlet was about 700m².
A boost for Hard Discount in France for 2009.
Address: IBT Partners - 17 rue du Colisée - 75008 Paris - France
The French government is currently discussing legislation that will favour hard discount retailers. The new law will ease restrictions on new store openings for retail surfaces between 300m² and 1,000m² - the core of the hard discount market. In 2007, hard discount was granted 25% of new food and household store opening authorisations, versus 40% for supermarkets and 35% for hypermarkets. This looks set to reverse over the next 18 months. The Mousquetaires group, owner of the Intermarché hypermarket chain and the hard discounter ‘Netto’, has already announced plans to double the number of hard discount stores.