“Galamart” will fuel sales – Newspaper Kommersant No. 228 (7429) of 08.12.2022
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Household goods retailers are entering the food segment. Thus, the network of cheap shops “Galamart” intends to expand the assortment at the expense of products. Another non-food retailer in this category, Fix Price, has launched such a business earlier, but the chain’s product sales are still low.
The plans of the federal franchising network of discounters with goods for the home “Galamart” to expand the range of food products became known from a vacancy on the HeadHunter portal. The company is looking for the head of a new product line “Food”. Galamart did not provide a comment.
The retail network of household goods “Galamart” includes more than 450 stores in Russia and Belarus. The first store of the chain was launched in 2009. Initially, outlets were opened under the Constant Sale Store brand; after rebranding in 2013, they were renamed Galamart.
One Story partner Olga Sumishevskaya believes that by expanding the assortment through food products, Galamart seeks to diversify its business, as well as increase traffic to its outlets. Mikhail Burmistrov, General Director of Infoline-Analytics, notes that the inclusion of food products in the assortment will allow the retailer to increase sales density. In a situation of decreasing purchasing power, food products in the assortment of stores look like one of the possible formats for business development, says Franshiza.ru expert Anna Rozhdestvenskaya.
When forming the range of food products, Galamart can rely on the experience of its main competitor, the Fix Price chain, which has supplemented the non-food segment with food products, Mr. Burmistrov believes. But Fix Price says that food products take up a small share of the assortment. At the same time, the share of food products in the total volume of Fix Price retail sales this year slightly decreased: in the third quarter of 2022 it was 27.2% against 27.9% in the same period in 2021 and 30.9% in the second quarter of 2022 .
Food suppliers and producers are also showing interest in cooperation with Fix Price networks, says Dmitry Leonov, deputy chairman of the board of the Rusprodsoyuz association. According to him, first of all, this concerns manufacturers who cannot get on the shelves of large federal chains. But, adds Mr. Leonov, it can be difficult for suppliers to fit into the narrow assortment and prices of these chains.
Alexey Vanchugov, managing partner of Vanchugov & Partners, suggests that Galamart can test the purchases and sales of food products in order to fully include them in the main assortment of new small-format hard discounters. As Kommersant previously wrote, Galamart plans to open the first few retail outlets in a new format for itself with an area of about 100 square meters. m in Chelyabinsk, Perm and Yekaterinburg. Now the area of most retail outlets of the network is 350-400 sq. m.
Today there is a high demand for franchises of small convenience stores in the economy segment, notes Anna Rozhdestvenskaya. In particular, the franchise of the Avocado network is actively developing. There is also a request to open Chizhik discounters owned by X5 Retail Group, but this chain does not have a franchise, Ms. Rozhdestvenskaya clarifies. The interest of retailers in small format stores is also confirmed by consumer behavior. According to NielsenIQ, about 45% of discount store visitors shop there once a week or more. And food products have reached the top of the most purchased goods in such stores. According to NielsenIQ analysts, against the backdrop of rising inflation and a reduction in real incomes, 89% of consumers consider price the main criterion for choosing a product.
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