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Private Label

Eroski Focuses On Private Label And Debt Reduction

By Branislav Pekic
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Eroski Focuses On Private Label And Debt Reduction

Spanish supermarket chain Eroski is intensifying its focus on private-label brands as a key strategy to compete with rivals Mercadona and Lidl.

Eroski aims to appeal to value-conscious consumers by promoting its own brands, offering high-quality products at affordable prices, it said.

The retailer's five private-label food brands – Eroski Basic, Eroski, Eroski Seleqtía, Eroski Natura, and Eroski Bio – are not only sold in Eroski stores but also in Vegalsa and Caprabo outlets in Galicia and Catalonia.

In the most recent financial year, these private-label brands contributed to 34.8% of Eroski's food sales, achieving sales of 51% in fresh food.

Eroski plans to boost the penetration of its private brands through investments in marketing, shelf-space optimisation, and collaboration with suppliers.

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Multi-Format Strategy

Additionally, Eroski remains committed to its multi-format and omni-channel strategy, investing in both physical stores and online channels to reach a broader customer base.

The company's market focus includes key regions of Spain where it holds leadership in market share, namely the Basque Country, Galicia, Navarra, the Balearic Islands, and Navarra.

Bond Issue and Loan

Elsewhere, Eroski has issued bonds totalling €500 million at an interest rate of 10.6% and secured loans amounting to €147.8 million. These funds will be utilised to repay debt, cover accrued interest, and address related fees and expenses.

Eroski has successfully reduced its debt by €2.56 billion since 2009, representing a 75% reduction in its total debt.

According to Kantar data, Eroski, holding a 4.4% market share, is the fourth-largest player in Spain, surpassing Dia in recent months.  The company claims to have gained market share since 2018 despite the competitive context of the sector.

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