Swiss retail group Migros has released its annual sales figures for 2017, which indicate that the company posted an overall sales increase of 1%, or CHF267 million, to CHF28 billion across its operations.
Retail sales at the group increased by 0.9% to CHF23.5 billion.
Migros' ten cooperatives recorded slower foreign and domestic sales of CHF15.555 billion (-0.5%), mainly due to a 0.4% sales decrease among its private label ranges, the retailer said.
The Zurich and Lucerne cooperatives grew by 0.2% and 0.9%, respectively. The retailer added 16 new stores to its portfolio of 701 in Switzerland, which includes four specialty stores and an M-Restaurant in the newly-opened Mall of Switzerland, near Lucerne.
The retailer’s sales abroad, including its Migros France operation, the German chain Tegut Group, the Gries Deco Group in Germany and Austria, as well as Probikeshop, amounted to CHF1.773 billion (-0.1%).
The cooperatives abroad saw sales increase to CHF1.247 billion (+2.6%), which was driven mainly by Tegut (+3.7%), while sales at Migros France fell by 6.4%.
Specialist Stores
The retailer’s subsidiaries and specialty stores achieved mixed results, with the largest growth seen in its bicycle shop M-way (+21.6%), and its largest decrease in the stationary shop Office World (-19.5%), which the retailer sold to Austria’s MTH Retail Group last October.
The retailer launched its Bike World stores at three locations last year, offering Switzerland’s largest bike selection, including a range of accessories and an integrated workshop, according to Migros.
Elsewhere, after a successful trial of in-store pharmacy Zur Rose at one of its stores in Bern, the retailer said it planned to expand the concept to more stores in 2018. This was the first time for the Migros cooperative to share its retail space with another retailer on a permanent basis.
Migros' specialist stores Micasa, SportXX, Melectronics, Do it + Garden, and Obi generated sales of CHF1.617 billion (+ 0.9%). Prices were reduced by an average of 2.7% in these stores, thus generating growth of +3.6% in real terms.
Other notable developments were an 11.3% sales growth to CHF480 million for its forecourt convenience store Migrolino, while the group's interior design company Interio saw sales decline to CHF 155 million (-8.0%).
E-Commerce Growth
With regards to e-commerce, the retailer retained its top position in Switzerland, with sales growing 5.1% to CHF1.95 billion, driven in large part by an 18.5% growth in its Digitec Galaxus online shop.
Additionally, the retailer’s online sales at its specialty stores have grown significantly, increasing by 25%, which Migros attributes to the expansion of its free collection and return service for online orders PickMup.
Migros has developed the service so that customers can now purchase products from 14 different online shops, and collect them at over 740 stores or pickup points across the country.
However, Migros’ online grocery platform LeShop experienced a 0.5% decrease sales last year. The retailer closed its two drive-in pick up locations to make way for its collection service, which leads to adjusted growth of 2.9% in this area, according to the retailer.
Regional Sustainability
Regional and sustainable products continued to grow in 2017, with sales of over CHF970 million (+3.0%), which includes products from its ‘Aus der Region. Für die Region’ (‘from the region, for the region’) range.
Demand also grew for products with an environmentally-friendly or socially-conscious emphasis, with sales of CHF2.964 billion (+3.8%). Part of this growth comes from Migros’ own organic range, and the sustainability programme TerraSuisse, which together account for half of the turnover of this segment.
Migros' sustainable, regional and health labels combined earned a total of CHF4.021 billion (+3.6%).
The retailer’s involvement in the health market grew too, with its takeover of the Silhouette fitness chain, and growing sales for its medical and therapeutic offering under the brand Medbase. The latter grew by 5.5% to CHF138 million, while Migros' Impuls platform offered tips and support to help customers lead a healthy lifestyle, according to the retailer.
Gastronomic Developments
Migros restaurant chains experienced a slower growth in 2017, with sales falling to CHF676 million (-0.9%). However, the group’s new formats saw growth, including chicken fast-food chain Chickeria (+69.5%), while its cooperative restaurants grew by 3%.
The retailer also acquired the healthy takeaway chain Hitzberger and integrated a specialty coffee selection from Café Royal into its restaurants and takeaway outlets in July.
Other sectors of the retailer's far-reaching empire experienced modest growth also.
M-Industrie, which produces most of the retail group’s own-brand products at home and abroad, was able to expand its market position in foreign markets such as Germany and China, and generated sales of CHF6.522 billion (+2.1%).
Meanwhile, the group’s travel agency Hotelplan Group posted 1.2% higher net sales on a like-for-like basis, despite challenging geopolitical events in some key destinations, including a weaker pound sterling, and the sale of Hotelplan’s Italian branches, according to the retailer.
Migros Bank made progress by expanding its investment business and continued the development of its core businesses in a challenging market environment, the retailer said.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Kevin Duggan. Click subscribe to sign up to ESM: The European Supermarket Magazine.
