KESKO HAS SENT A NOTICE OF TERMINATION TO 11 CITYMARKET RETAILERS

Kesko has sent a notice of termination to the 11 Citymarket retailers who have not signed the new chain agreement. When transferring to the new system, Kesko cannot apply parallel systems. The reformed chain operations between Kesko and about 1,450 K-retailers were introduced from the beginning of 2001. A total of 30 Citymarket retailers have signed the new chain agreement.

In the Citymarket hypermarkets, retailers are as entrepreneurs responsible for the food trade. Kesko’s subsidiary Citymarket Oy is responsible for the nonfood trade in the hypermarkets. The period of notice for the retailers is six months. The operations of all Citymarket hypermarkets will continue normally during and after the period of notice.

A total of over 98 percent of the K-retailers have approved the new chain agreement or a customer agreement. The new operational system will be adopted gradually over about two years. It is expected to significantly improve the K-stores’ efficiency and competitiveness and the retailers’ profitability and to give good opportunities for the improvement of Kesko’s profitability within the next few years.

The cooperation system between Kesko and the K-retailers intensifies chain operations in the development of retail store concepts, in category management, marketing, purchasing operations and logistics. In the new chain operation, Kesko is responsible for the continuos development of store concepts, the management of chain operations and the purchasing of the products included in the chain selections. The retailer continues to be responsible, as an entrepreneur, for his business operations, and he uses the chain concept in his store. The retailer is also responsible for the purchasing and selection of local products.

Kesko Corporation
Corporate Communications

Atte Kaksonen
Manager

Distribution
- HEX Helsinki Exchanges
- Main news media