Cooperative Buying Groups
The EROSKI Experience
25 February 2012
CONTENTS
01
01
About EROSKI
02
How EROSKI sees partnerships
03
Our main partnerships
04
MONDRAGÓN and the International Year
of Cooperatives
Índice /
2
01
About
EROSKI
Índice /
3
1969, EROSKI S. COOP. IS BORN
EROSKI came into being when nine small, local,
independent consumer cooperatives decided to join
together.
On its inception EROSKI formed part of the MONDRAGON
cooperative movement, the seventh-largest business
group in Spain and which this year celebrates the 50th
anniversary of the creation of its first
cooperative.
01
About EROSKI
4
TODAY
> 43,494 employees
> 634,000 consumers
> Turnover of €8bn
> Spain’s third-largest food
retail distributor
01
About EROSKI
5
BUSINESS AREA
105
HYPERMARKETS
SUPERMARKETS
474
170
3
342
FOOD
BUSINESS
485
SELF-SERVICE
OUTLETS
01
About EROSKI
6
TRAVEL
BUSINESS AREA
218
PETROL
STATIONS
NON-FOOD
BUSINESS
OPTICIANS
59
37
PERFUMERY
SPORTS AND
LEISURE
281
01
36
About EROSKI
7
SALES FIGURES (millions of €)
9.000
8.000
7.000
6.000
5.000
4.000
3.000
2.000
1.000
0
01
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
About EROSKI
8
What sets our consumer
cooperative model apart?
Worker partners and consumer partners have an equal
say in the running of the cooperative.
01
About EROSKI
9
A COOPERATIVE MEMBERSHIP PROJECT
>
Average workforce of 43,494 employees,
14,579 of whom are partners.
>
Cooperative membership: The objective is
for all EROSKI workers to become
cooperative members.
>
Two new cooperatives to be formed in our
Group in March.
01
About EROSKI
10
CONSUMER-ORIENTED INITIATIVES
Education and information for healthier and more
responsible shopping choices:
> Consumer rights
> Nutrition and food
> Health and well-being
> The environment and sustainabllity
> Solidarity
> Etc
01
About EROSKI
11
CONSUMER-ORIENTED INITIATIVES
Healthier EROSKI products and better-informed choices:
>
Labels showing the amount of calories, salt, sugar, fat,
saturated fat, fibre etc, and featuring colour coding.
>
Elimination of artificial trans fats. In 2007 we became
the first Spanish retail distribution
company to remove trans fats originating
from partially hydrogenated vegetable oils
from their own-brand products.
01
About EROSKI
12
CONSUMER-ORIENTED INITIATIVES
Healthier EROSKI products and better-informed choices :
>
Upcoming launch of the Sannia range of delicious and
healthy products: lower in salt, sugar and fat or
containing special ingredients
(Omega3, fibre, vitamins, etc).
01
About EROSKI
13
The “With You” store
Our model for the future – another step forward in the
inclusion and involvement of the consumer partner
01
About EROSKI
14
Helping consumers lead healthier and more responsible lives,
creating a more appealing shopping environment,
and committed to competitive prices.
communication
of personality
adapted-integrated
local market
most attractive
price-promotion
health and
well-being
Improved clientpartner relationship
outstanding
fresh foods
01
About EROSKI
15
ABOUT THE “WITH YOU” STORE
>
A socially responsible store that is committed to the
environment: reduced energy consumption, no noise pollution,
use of renewable energies, etc.
01
About EROSKI
16
ABOUT THE “WITH YOU” STORE
Involves the customer, treats them as a partner:
>
Their interests and concerns are reflected in the “With You” store
(feeling better, losing weight, celebrating local festivities, etc).
>
Closer to the customer. More personal service.
>
We manage the brand, the store and Eroski itself in line with the
customer’s tastes and preferences.
>
Best customers will become
partners and play a part in
stores along with worker
partners.
01
About EROSKI
17
Our goal of a “franchised store’
A store based on our main asset – a cooperative formed by
workers and consumers.
01
About EROSKI
18
FRANCHISED STORE: BUSINESS MODEL
>
Increased contact between store workers and customers, aim
being to get closer to the customer and get to know them better.
>
Worker partners or cooperative members have the freedom and
power to make decisions and adapt the store to satisfy the needs
of their customers.
>
Stores are no longer identical
outlets in a chain. They become
part of the local fabric and
adapt to their surroundings.
01
About EROSKI
19
02
How EROSKI sees
partnerships
Índice /
20
PARTNERSHIPS: WHY AND WHAT FOR?
>
Our biggest competitors on the local market are or will be
international. This international dimension allows these retail
distributors to gain knowledge, economies of scale and increased
negotiating capacity.
>
The leading manufacturers are international and have greater
negotiating power than small- and medium-sized retail
distributors.
>
Consumer cooperatives do not expand abroad. Our model cannot
easily be exported.
>
Partnerships with similar organisations are the
international solution for coops.
02
EROSKI and Partnerships
21
EUROPEAN RANKING
Sales in 2010 (€bn)
A
140
117
120
Alidis, 3rd in Europe
91
100
81
74
80
67
54
60
47
42
42
40
31
40
20
8
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02
EROSKI and Partnerships
22
INTERNATIONAL RANKING
A
300
277
250
Intercoop, 5th in the world
200
150
100
78
60
46
50
30
29
26
22
21
18
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02
EROSKI and Partnerships
** 2007 data for Coop, Target, AEON, Coles AND IKEA, 2008 data for Wal-Mart, 2006 data for the rest. Exchange rate used: Euro 1=USD 1.37
23
WHO ARE OUR PARTNERS?
Our partners have the following profile:
>
Independent. They cannot be bought or sold.
>
Not competitors.
>
Possess similar values: preferably cooperatives.
>
Shared vision of the partnership: strategic alliance.
>
Business affinity.
ALIDIS and INTERCOOP are a response
that ensures we will not be competing at a
disadvantage with rivals who have expanded
abroad.
02
EROSKI and Partnerships
24
03
Our main
partnerships
Índice /
25
ALIDIS – FOOD MARKET
>
European alliance of independent retail distributors, formed by:
•
Intermarché: 3rd in France
•
Edeka: 1st in Germany
•
Eroski: 3rd in Spain
03
Main Partnerships
26
ALIDIS – A LONG-TERM PROJECT
Key dates:
>
1998: Intermarché creates Agenor (Geneva)
>
2002: Les Mousquetaires and EROSKI found ALIDIS
>
2005: EDEKA joins ALIDIS
>
2007: The partners all become part of Agenor
03
Main Partnerships
27
ALIDIS – STRUCTURE
33.33%
Strategy
33.33%
33.33%
100%
Operational level
03
Main Partnerships
28
ALIDIS – OBJECTIVES
>
Strengthen the competitive position of each partner.
>
Merge purchasing.
>
Share information freely on suppliers, raw materials, sales and
store management.
>
Develop, acquire and share technologies, techniques, systems,
programmes and knowledge.
>
Engage in joint business ventures.
03
Main Partnerships
29
ALIDIS – FRAMEWORK INTERNATIONAL PURCHASING AGREEMENTS
03
Main Partnerships
30
ALIDIS – NEGOTIATION OF JOINT PURCHASING
03
Main Partnerships
31
ALIDIS – EXCHANGE OF KNOW-HOW
Automated platforms. Visita to M-50 (EROSKI) and Hamn (EDEKA)
MADRID: 07-04-2011
HAMM: 24-05-2011
03
Main Partnerships
32
ALIDIS – EXCHANGE OF KNOW-HOW
Self checkout systems. Visit to leading centre in ITM self checkout sales
EROSKI self checkout pilot system
Intermarché self checkout system
03
Main Partnerships
33
ALIDIS – EXCHANGE OF KNOW-HOW
Improvement in own-brand range of products: Showrooms.
Presentation of entire MMDD ranges at Geneva. 11 categories
presented in Q4 2011 and 11 scheduled for Q1 2012
03
Main Partnerships
34
ALIDIS – EXCHANGE OF KNOW-HOW
Other workshops in progress:
>
“Green” store
>
Organic products
>
Promotional marketing and customer loyalty cards
>
Category management of a number of sections
>
New store formats and concepts
>
…
03
Main Partnerships
35
INTERCOOP – NON-FOOD MARKET
>
Intercoop represents a group of cooperative retailers
~
~
~
~
>
Turnover of €40bn
9,000 stores
200,000 employees
18 million members
We share similar values and ways of
doing business, and we also see the
safeguarding of “social responsibility in
non-food products” as a priority.
Norway
03
Italy
Sweden
Finland
Denmark
Main Partnerships
36
INTERCOOP – NON-FOOD MARKET
Intercoop has been operating in Asia since 1979 as the global
sourcing office for Europe’s biggest cooperative retailers.
Shanghai
China
Karachi
Pakistan
New Delhi
India
Dhaka
Bangladesh
Hong Kong
Head office
Ho Chi Min
Vietnam
03
Surabaya
Indonesia
Main Partnerships
37
INTERCOOP – ACTIVITIES
>
>
Market information for partners
Creation of product ranges:
•
Own-brand range of each partner
•
Fantasy brand
>
Joint management of suppliers: location, selection, monitoring
>
Single negotiating stance with suppliers.
>
Group buying of products.
>
Joint operating process:
•
Quality control
•
Logistics (freight)
•
Ethical audits
03
Main Partnerships
38
Final Conclusions
03
Main Partnerships
39
FINAL CONCLUSIONS
>
Partnerships yield significant advantages: economic advantages
and better know-how.
>
These are essential for cooperatives.
>
To achieve significant benefits each partner has to be intensely
committed.
Tactical partnerships: low commitment, low returns.
Strategic partnerships: high commitment, high returns.
>
Importance of partner profile (independence and same values
and vision).
03
Main Partnerships
40
FINAL CONCLUSIONS
Difficulties faced by cooperatives and not by competitors:
>
Local and defensive competitive vision.
>
Weak leadership.
>
Inability to delegate abroad.
>
Slowness in making and implementing decisions.
03
Main Partnerships
41
FINAL CONCLUSIONS
High potential of partnerships between cooperatives:
A European cooperative network oriented towards the health
and well-being of consumers and society can be created.
>
This would help us make better purchases.
>
Develop better products for the consumer.
>
Enhance our know-how.
>
Others (joint business ventures and services).
03
Main Partnerships
42
04
and the
International Year of
Cooperatives
MONDRAGON
Índice /
43
www.eroski.es
48