CCA Groceries Retail Market Inquiry for 2021: Retail turnover rose by 8.4 % – Konzum plus in the lead

The Croatian Competition Agency (CCA) carried out the Groceries retail market investigation (including food, beverages and sanitary products for households) in Croatia for 2021.

The realized turnover of all the undertakings that were included in the market investigation for 2021 amounted to more than 43 billion Kuna, which actually means that the groceries retail turnover has risen by HRK 3.4 billion or 8.4 % in comparison with 2020. In 2020 the groceries retail market rose by HRK 306 million or 0.8 % relative to 2019.

The total sample included 47 undertakings.

The market inquiry indicated the rise in the total number of outlets by 2.5 % (4,825 outlets or 118 more than in 2020) whereas the net sales space increased by 4.8 % (1,51 million m2), indicating a reverse trend compared with the previous year.

Market structure and trends in retail groceries market in 2021

The largest grocery retailer in 2021 was Konzum plus. The market share of Konzum plus in 2021 was 20-30 percent with a slight decrease compared to 2020, despite the rise in groceries retail. In 2021, it had 620 outlets (608 in 2020). After a longer period, Konzum plus made one acquisition in October 2021, when it took over a small retailer, the undertaking Miracolo with its 13 small format outlets in Istria County.

It must be noted here that the above-mentioned market share of Konzum plus, as well as all other market shares, are shown in a percentage range, and not in exact amounts, as designated by the undertakings concerned as business secrets.

The rising trend in the groceries retail turnover was continuously recorded by the members of Schwarz Group. In 2021, Lidl also indicated a rise in its groceries retail turnover. Lidl’s market share in 2021 was 10-20 percent. Another member of Schwarz Group, Kaufland, also recorded a turnover rise with a market share of 5-10 percent. Together, both members of Schwarz Group indicated a stable market share of 20-30 percent in 2021.

In 2021, a total of 38 undertakings showed a rise in groceries retail compared to the previous year 2020 (when there were 30 of them), while 9 retailers indicated a negative trend with a turnover decrease (in 2020 there was a total of 21 undertakings with a falling turnover trend). Plodine, as in 2020, indicated the highest nominal rise, followed by Konzum plus, Lidl, Trgovina Krk, Tommy and Kaufland.

The regional retailer Trgovina Krk grew significantly due to the combined turnover with the connected undertaking Metss (Čakovečki mlinovi Group). However, Trgovina Krk, taken separately (without Metss turnover), indicated organic growth in its turnover, which was additionally intensified by the fact that in August 2021, Trgovina Krk d.d. merged with a part of the company Radnik Opatija d.d., also a member of Čakovečki mlinovi Group, by taking over 61 retail outlets of Radnik Opatija d.d. that continued to be active as an economic entity in its primary field of business – bakery and confectionary.

Looking at the top ten grocery retailers in 2021 compared to the previous year, Plodine recorded the largest increase in market share, followed by Tommy and Studenac.

In 2021, the rise in grocery retail turnover was recorded by the majority of regional retailers, namely: Mlin i pekare, Lonia Trgovina, Trgovina Krk, Boso, Ribola, Slavonija Bošković, Jadranka Trgovina and Pemo.

The change in 2021 compared to 2020 was that Mlin i Pekare overtook Lonia Trgovina in 10th place and was again positioned in the “Top 10” of retailers in terms of the grocery retail turnover.

In 2021, Studenac took the first place in the number of outlets (696 outlets), mostly small format stores and supermarkets.

Decline in asymmetry and moderate rise in market concentration

Asymmetry in the retail market declined further in 2021, in other words, in respect to the market share, the discrepancy between the leader in the market Konzum plus and its second rival Lidl has been diminished.

Compared with 2020 the report year showed a mild rise of the concentration ratio CR10 (the market shares of the 10 biggest retailers in the market), that was 83.4 in 2020 and 83.5 in 2021.

The results of the analysis of the five-top-rivals (CR5) indicated that the concentration ratio slightly rose from 66.1 in 2020 to 66.2 in 2021.

Changes at the regional level

Counties and the City of Zagreb

In contrast to the survey for 2020, when 13 counties and the City of Zagreb recorded a rise in the groceries retail turnover, in 2021, the turnover rise was recorded in all 20 counties and the City of Zagreb. The highest groceries retail turnover, after the City of Zagreb (HRK 7.8 billion), was recorded in Split-Dalmatia County (HRK 5.6 billion), Primorje-Gorski Kotar (HRK 3.8 billion) and Istria (HRK 3.2 billion). In other counties, the groceries retail turnover was less than HRK 3 billion.

The change from a negative to a positive trend in the counties on the Adriatic coast in 2021 was undoubtedly caused by the rise in tourist trade and increased consumption due to relaxed precautionary measures. As a result, the majority of retailers experienced a turnover growth in the counties on the Adriatic coast.

An important change in 2021 compared to 2020 was that the County of Istria has overtaken the County of Zagreb in the fourth position in terms of the groceries retail turnover. The highest nominal growth in the groceries retail turnover was achieved in the observed year of 2021 by the County of Istria, where the growth in groceries retail turnover amounted to HRK 585 million (an increase of 22 percentage points) , followed by Split-Dalmatia County, with the groceries retail turnover of HRK 541.4 million (an increase of 10.7 percentage points), and Primorje-Gorski Kotar County, where the turnover growth in 2021 was HRK 345 million compared to 2020 (an increase of 10 percentage points).

The City of Zagreb and six counties (Split-Dalmatia, Primorje-Gorski Kotar, Istria, Zagreb, Zadar and Osijek-Baranja) realized almost two-thirds (65.4 percent) of the total groceries retail turnover in the Republic of Croatia in 2021, continuing the recent trend, with a slight increase compared to 2020 (64.9 percent).

Regarding the individual retailers in the City of Zagreb and the counties, Konzum plus was the leading retailer in the City of Zagreb and six other counties (Zagreb, Krapina-Zagorje, Varaždin, Karlovac, Lika-Senj and Osijek-Baranja), just as in the previous year.

Members of the Schwarz group remained the leaders in four counties. Lidl was the leading retailer in Koprivnica-Križevci and Bjelovar-Bilogora County, while Kaufland was the leading retailer in Brod-Posavina and Požega-Slavonia County, the same as in the previous year 2020.

Cities of Split, Rijeka, Osijek

Tommy retained the first position in Split, with a decrease in the market share. In Split, in 2021 there was a change of trend compared to the last year’s survey with an increase in the groceries retail turnover compared to 2020, most likely due to the increase in tourist trade and relaxed anti-pandemic regulations.

In Rijeka, Plodine continued to be the market leader, while all other retailers kept a stable turnover.

In Osijek, Konzum plus remained the biggest retailer while all the groceries retailers in Osijek increased their turnover as well.

Supermarkets keeping the lead

The results of the market investigation showed that the highest nominal rise in the realized turnover in 2021 compared with the previous year in the amount of HRK 2.2 billion (an increase of 11 percent) was recorded in supermarkets. For the sake of comparison, the highest nominal rise had been almost HRK 227 million in the reference year of 2020 compared with 2019 in the convenience stores around the corner.

The rise in the groceries retail turnover in 2021 was recorded by all four observed types of sales outlets, the highest in supermarkets (11 percent), while the lowest turnover rise was recorded by small shops (slightly less than one percent).

Supermarkets have remained dominant in the structure of sale both regarding the realized turnover, and the net sale space they occupy. In the observed year of 2021, the consumers still predominantly shopped in hypermarkets and supermarkets – more than two thirds or 71 % of the total groceries retail turnover was realized in big format shops, above 50 % in supermarkets and less than 22 % in hypermarkets.

Similar as in the previous year, self-service stores held the share of some 44 % of all retail outlets, 23 % share was held by hypermarkets, both being the big-format shops occupying the largest net sale space. These were followed by supermarkets with 22 % share and small shops with some 7 %.

On-line shopping and loyalty programmes

The results of the inquiry for 2021 showed that groceries on-line shopping has still not taken a significant share in the total turnover structure of the groceries retail shops. The highest share in the on-online groceries retail turnover was recorded by Konzum plus.

Loyalty programmes were applied by 16 groceries retailers, two more than in 2020. Lidl and Tommy started their loyalty programmes at the end of 2021. Konzum plus and Kaufland had the highest number of members in their loyalty reward programmes.

Profit margin

In 2021 the CCA has further expanded the retail groceries market investigation in the Republic of Croatia to profit margins of retailers applied across different categories of goods. The categories that were selected by the CCA were: meat and meat products, poultry meat and eggs, bakery products (bread, pastries), milk and dairy products, fresh fruit and vegetables, soft drinks and water, confectionery products (biscuits, chocolates, candies, etc.) and basic food products (flour, sugar, rice, noodles, edible oils, etc.

The indicators taken into account by the CCA included 2021 and the period May/June 2022, that is, the period when the questionnaire was sent to the retailers.

The results of this research showed that the average margins for food products in 2021 and in the period May/June 2022 were the highest in the category of bakery products and confectionery products, and relatively high in the category of fresh fruit and vegetables and basic food products (flour, sugar, rice, noodles, edible oils, etc.).

Of the eight observed categories of goods, three categories indicated a decrease in the average profit margin (poultry meat and eggs, milk and dairy products, fresh fruit and vegetables) in May/June 2022 compared to 2021, while in five observed categories of goods the average profit margin increased.

Please click here for a detailed version of 2021 CCA’s Groceries Retail Market Inquiry in the Croatian language.