Market News

Drought as another threat to grocery market?

Consumers and retailers have not yet managed to adapt well to the new reality related to the presence of the coronavirus epidemic in Poland, and another threat to the food supply is on the horizon – drought. A low level of harvest combined with a decrease in the purchasing power of Poles as a result of increased unemployment and wage cuts would have a disastrous impact on the economic situation.

 

Drought is inevitable?

Winter 2019/2020 was mild and dry, recent weeks were characterised by very low rainfall, and forecasts for the May-July period indicate precipitation in the standard or below, but mainly of storm characteristics – this type of rainfall runs off quickly and does not build long-term soil moisture. Thus, all factors indicate a high risk of drought, which will negatively affect the yield level in 2020.

Another challenge for grocery market

Low yields will result in further food price inflation, which, combined with the effects of the COVID-19 epidemic and the closure of the economy (increased unemployment, lower wages in some businesses, whole segments of the trade and services market not operating), means a decline in purchasing power for many consumers. Consumers may not only save on some non-food items (natural behaviour in times of crisis), but may be forced to give up some food items or replace them with cheaper products.

How will grocery chains react?

The question remains open as to how the food chains, which are the key recipients of food in Poland, will adapt to the new situation – the 20 largest market players are jointly responsible for as much as 74% of the value of the food market in Poland, according to PMR data for 2019. Biedronka itself, the market leader, has a share of 19%. In recent years, although the prices of fresh fruit and vegetables in shops were often at very high levels, at the same time farmers often pointed out that the chains take advantage of their position and offer very low purchase prices. On the other hand, if at least one large player at least temporarily refrains from price increases and takes the costs on, other networks will follow in its footsteps. This would mean that the impact on consumers would be postponed.

Leave a Comment

Your email address will not be published.

You may also like

Market News Trends

Polish state to consolidate the agri-food sector

post-image

The Ministry of State Assets (MEP) is working on the merger of companies from the agri-food sector, which are under state supervision. The National Food Holding (NHS) is to be established in this way.

June: selection of companies for the holding company

The consolidation will be based on the Krajowa Spolka Cukrowa, which is present on several markets, including sugar, starch and grain. The objective is to create a strong agri-food holding and enter new business segments. The idea behind the consolidation undertaken by MEP is that “on the one hand, consumers should receive competitive prices, and on the other hand, farmers and manufacturers should be well paid for their products”.

Currently, 48 companies that could be part of the holding are being analysed. The plan provides that the companies to be consolidated are to be selected in June. By the end of the year, more detailed research…

Read More
Market News

Robotisation in retail & logistics – overview for 2020, part II

post-image

Bartłomiej Łatka, Sales Director at Euvic IT, writes in the second part of the article about what robotization has to offer to the retail segment in 2020.

Mobile robots

Bartłomiej Łatka, Sales Director at Euvic IT

Recently, mobile robots have been pushing people out of storage space in large warehouses. There is a shortage of warehousemen throughout Poland, and warehouses often located on the outskirts of cities or even in the fields, struggling to provide staff. Especially during the holiday or flu season. Relatively high salaries, regulated by the law for working at night or on public holidays, as well as the risk of loss of manning – all that makes automated internal transport systems seem to have the best years ahead.

Among mobile solutions in trade and logistics we can distinguish the following groups:

  • Transport P2P (Point-to-Point) – AMR trolleys carrying baskets…
Read More
Market News

Glovo grows in food delivery in Poland

post-image

The Glovo mobile application, which specialises in on-demand deliveries, has just exceeded 1 million downloads in Poland (App Store and Google Play). Although a wide range of products can be ordered with Glovo, it is widely used to deliver food.

Glovo in Poland: 1 million application downloads

Glovo has been operating in Poland since July 2019, following the acquisition of PizzaPortal.pl. The idea behind the application is to be able to order “anything” and delivery takes place in less than an hour. Glovo has over 2,700 partner points in Poland, including McDonald’s and KFC restaurants and Biedronka and Carrefour shops. The application operates in 30 cities in Poland, but Glovo announces a systematic expansion of its offer and development of all order categories. In total, around the world, the application is used by approximately 2.6 million users per month. It is available in 22 countries and about 550 cities.

The most numerous…

Read More
Market News

Tesco is developing a click & collect service in Poland

post-image

Tesco develops its activities in the e-commerce segment. In May, the company added five new cities for the “Zamow i odbierz” (click & collect) service in Poland.

14 click & collect points

New locations where the service is available are Czestochowa, Zielona Góra, Opole, Kielce and Jelenia Gora. Thanks to the extension of the network of collection points, it is now possible to serve 15% more customers under this solution. In total, currently the click & collect option is available in 14 Tesco stores across the country. Around 2,000 customers use such purchases every week. The chain announces that it will soon introduce further novelties extending the scope of services.

Purchases made in the “Zamow i odbierz” option can be picked up in the store or delivered home by a taxi company cooperating with Tesco. When completing an order via taxi, payment must be made online. In case…

Read More
Market News

Robotisation in retail & logistics – overview for 2020, part I

post-image

As far as saturation with robots is concerned, the Polish market is unfortunately in the tail of the rankings, which is quite surprising if we take into account, for example, Polish GDP (where we have 22nd place in the world) or Human Development Index (Poland with 32nd place in the world).

Bartlomiej Latka, Sales Director at Euvic IT

In 2014, roboforum.pl wrote that “Poland, with the value of the index at 18, is at the bottom of the ranking. Higher density of robotization than Poland is characteristic not only for countries that are among the leaders in this respect, but also for countries with a similar level of development, such as Hungary or Slovakia. The average robotisation density in Europe is 4.4 times higher than in Poland (compared to the previous year, Poland reduced the distance to Europe by 1.1 points),…

Read More
Market News

Camaieu is leaving Poland

post-image

Camaieu clothing chain, specialising in women’s clothing, is leaving the Polish market. The company’s website has already stopped accepting orders and the stationary stores are to be closed at the end of June.

Camaieu is looking for an investor

As far back as 2018. Camaieu operated about 40 stationary stores in Poland. However, the chain has recorded negative sales dynamics in recent years, and the number of stores has been gradually decreasing. Currently, it amounts to 25. In total, the chain operates about 1 ,000 stores in 18 countries, more than half of which are located in France.

The COVID-19 pandemic and the closure of shops in shopping malls have worsened the company’s situation, but it has already been struggling with financial problems. According to Business Insider, the company planned to implement a restructuring plan from the spring, which was to include the closure of 125 stores in…

Read More