Grocery Retailing: A Gem of the Industrial Crown with Increasing Purchasing Power of Citizens of Czech Republic: Ken Research
Posted on 16 October 2017 by KenResearch Consumer Products and Retail,
For industrial growth, macroeconomic factors play a major role. With expanding economy, market also grows. Czech Republic has seen positive macroeconomic growth in 2016. All macroeconomic factors have witnessed positive trends. Wages increased by over 4%, unemployment has reduced and has reached a lower level of 4%. With this, consumer sentiments have reached record high levels. All these factors combined have increased the purchasing power of consumers. This increased purchasing power has given boost to the grocery retail sales, which has seen significant growth in 2016. Grocery retailing in Czech Republic has seen a growth rate of 4% in 2016, and since the economy is expected to continue its growth pattern, grocery retailing is expected to grow further.
The expansion of the economy of Czech Republic is one of the main factors for the growth of grocery retailing. With the improvement in the per capita income because of positive growth of macroeconomic factors, consumable income with people increases which increased the volume of sale in the Czech grocery market. In addition, with increased purchasing power, retailers are able to maintain their profit margins and hence are able to earn hefty returns. Ahold Czech Republic is the market leader in grocery retailing market since past two years. Before that, Kaufland Ceska Republika was the market leader after it acquired one of the major retailers, Spar in 2014. Tesco Stores hold the third place in this market segment. Other major grocery retailers in Czech market are Schwarz Group and Lidl Ceska Republika. The market can be segmented into traditional grocery stores and modern grocery stores with modern grocery stores showing exponential growth in past few years. People have also started purchasing grocery from online stores and hence, many modern grocery stores have started operating online also, since they do not want to lose the young consumers who prefer purchasing most of their groceries online.
According to the market research report "Grocery Retailers in the Czech Republic", in past few years, the unemployment has reduced significantly in Czech Republic and hence, the purchasing power of consumers has improved. These positive macroeconomic factors have pushed all the Czech Industries in positive direction, and grocery stores have benefited from this positive trend. With increased income levels, consumers will be able to afford more and better quality products, which will promote groceries retailers to expand their reach and product line. With all these factors combined, grocery retailing in Czech Republic is expected to see robust growth in coming years.
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