Grocery trade strategy
We continue the determined execution of our growth strategy, but for now our focus is on managing the situation brought on by the coronavirus epidemic. Information on the impacts of the epidemic on Kesko’s businesses can be found under the Operating environment section.
Our strategic objectives:
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STRATEGIC OBJECTIVE |
WHAT WE ARE DOING |
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The most customer-oriented and inspiring food stores with store-specific business ideas |
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Profitable development and redesign of the store network |
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A seamless omni-channel customer experience |
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Good price competitiveness |
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Developing retailer entrepreneurship as a competitive advantage |
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Significant growth in the foodservice business |
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Business environment
- Digital is a basic requirement
- Hybrid and polarised consumption set to grow stronger
- Significant demographic changes
- Emphasised importance of climate change and environmental consciousness
- Operations and concepts must be responsible and sustainable
Comparable figures
The grocery trade strategy review can be read in Kesko's 2019 Annual Report.
In 2019, the Finnish grocery trade market was worth approximately €18.6 billion (incl. VAT), representing a growth of some 2% (Kesko's own estimate). The overall market growth was impacted by e.g. continued good consumer purchasing power and a rise in prices, over onethird of which was attributable to increases in alcohol and tobacco taxes. Price competition in the Finnish grocery trade market has continued to be intense. However, consumers also increasingly value local food, sustainability, healthiness and quality..
MARKET SHARES
Grocery trade
The market share in Finland is 36.7% (Kesko’s own estimate based on Nielsen’s new comparison group which includes discount stores and service stations as well as grocery stores).
Competitors: Prisma, S-market, Alepa/Sale and Food Market Herkku (S Group), Lidl, Tokmanni, Minimani, Halpa-Halli and M-chain stores.
K-Citymarket's home and speciality goods
Market share cannot be reliably calculated.
Competitors: hypermarkets, department stores, discounters, specialist chains and online stores.
Foodservice
Kespro, Finland
The market share is estimated to have strengthened to approximately 42.2% (Kesko's own estimate, based on the Finnish Grocery Trade Association’s Foodservice wholesale market peer group).
Competitors: Meira Nova, Metro-tukku, Heinon Tukku, Suomen Palvelutukkurit.
| Number | Sales (pro forma) (VAT 0%), € million |
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| Retail sales and number of stores | 2019 | 2019 | Change, % | |
| K-Citymarket, food | 81 | 1,711.3 | 5.4 | |
| K-Citymarket, non-food | 81 | 586.5 | 0.5 | |
| K-Supermarket | 243 | 2,051.3 | 4.1 | |
| K-Market | 777 | 1,863.7 | 2.1 | |
| Neste K | 73 | 130.9 | -1.2 | |
| Others | 78 | 43.6 | 5.9 | |
| Total | 1,252 | 6,387.3 | 3.4 | |
| Kespro | - | 944.3 | 7.6 | |
| Grocery trade, total | 1,252 | 7,331.5 | 3.9 | |
| In addition, several K-food stores offer e-commerce services to their customers. | ||||
| Key figures | Rolling 12 mts 6/2020 |
2019 | 2018 | |
| Net sales, € million | 5,611.3 | 5,531.2 | 5,385.7 | |
| Operating profit, comparable, € million | 335.4 | 327.9 | 294.5 | |
| Operating margin, comparable | 6.0 | 5.9 | 5.5 | |
| Return on capital employed, comparable, %, rolling 12 months | 14.8 | 14.5 | 13.1 | |
| Capital expenditure, € million | 154.7 | 180.8 | 124.1 | |
| Personnel, average | - | 6,063 | 6,094 | |
| Properties | 2019 | 2018 | ||
| Owned properties, capital, € million | 763 | 658 | ||
| Owned properties, area, 1,000 m² | 516 | 433 | ||
| Leased properties, lease liabilities, € million | 1,495 | 1,512 | ||
| Leased properties, area, 1,000 m² | 1,520 | 1,581 | ||
