Retailers looking to expand in the Czech Republic should target smaller towns as market saturation in the sector increases, according to a leading regional analyst.

The best opportunities for further expansion are in towns of 5-30,000 people,  Tomás Drtina, managing partner of Incoma Research said yesterday (4 February) in Prague.

Drtina told the Retail Summit 2009 that market saturation in the Czech Republic is higher than in neighbouring countries in central and Eastern Europe.

“The Czech Republic is in this respect above-average in post-communist Europe but still lagging behind for instance Great Britain,” Drtina said.

Last year, some 15 hypermarkets were opened in the Czech Republic, although there was faster growth in the number of discount stores in the country.

Tesco site research country manager Jan Koutny said the building of suburban shopping centres in the Czech Republic would slow. Tesco, Koutny said, would look to build new outlets and renovate existing stores.

“We shall start with our department stores, located in city centres,” Koutny said.