Marks & Spencer plans to open its first store in Egypt later this year with franchise partner Al Futtaim. just-food takes this opportunity to take a deeper look at the Egyptian super and hypermarket sectors with the help of research partner Euromonitor International.

  • Hypermarket sales continue to grow rapidly in 2009 by 20%, to total EGP1.5 billion (US$262m).
  • Hypermarkets continued to witness booming sales in 2009, on the back of new store openings. All the existing operators continued to expand rapidly, especially the international brands Carrefour and Spinneys. This led to dramatic growth rates in the category across all measures.
  • This phenomenal expansion accompanied a strong consumer shift towards this format as it offers a more comfortable shopping environment, more attractive promotions and discounts, and most importantly, wider ranges of high quality products for both grocery and non-grocery items. 
  • Private label in many fast-moving consumer goods (FMCG) categories at mass prices was one of the main tools used by many retailers, including Spinneys and Carrefour, to attract a larger number of the low income consumers. 
  • The period 2009-2014 is predicted by Euromonitor to continue to be successful for hypermarkets. Customers in the next few years will change their random shopping habits into more organised ones through using hypermarkets. This will lead to 2% CAGR increase in constant value sales for hypermarkets over the forecast period. 
  • In 2009, supermarket value sales reach EGP11.9 billion, growing by 9%. 
  • Supermarkets remained as one of the most important channels for grocery products in Egypt. In 2009, sales rose 9%, which was marginally lower than the average for the review period as a whole, due to declining purchasing power. The channel continued to grow at the expense of older retail formats, such as independent grocers and food specialists.
  • Unlike the hypermarket format, the supermarkets category is much more fragmented and is still monopolised by local retailers, as none of the multinational companies have, as yet, invested in it. Competition is also moderate and movement in shares were minimal across the main leading companies. 
  • Although supermarkets will continue to grow at the expense of older retail formats, such as independent small grocers and food specialists, it will however lose share to the boom in hypermarkets with many consumers shifting towards this modern and most convenient format. 
  • The supermarket format is predicted to see declining growth in value sales over the forecast period. Yet it will witness a growth in the number of new outlets and selling space growing by CAGRs of 4% and 3% respectively.

Click on the following link for more details on Euromonitor's report Retailing in Egypt