Discount retailers show growing interest in broadening the locations of their stores, including traditional shopping centres
Discount retailers predicted to find Central and Eastern Europe (CEE) market very attractive as evidence shows shoppers have favoured the ‘value for money’ approach these retailers provide - reveals a new report by Colliers “ExCEEding Borders CEE | December 2021 Alive & Kicking CEE-16 on the radar of discounters”.
The report authors reveal that despite the ongoing pandemic a positive bounce in GDP has been seen. Yet the combination of the growth in inflation, and problems relating to the global supply chain, which add to the growing cost of products and resources, all contribute to the challenges faced by producers, retailers and, ultimately, this passes on to the consumer. Due to the fact that the long-term impacts of the pandemic are still unknown, the growth in importance of smaller shopping centre formats and retail parks has strengthened. The multiple number of schemes under construction or in advanced stages of planning across CEE region confirm this trend.
“Despite the Covid-19 pandemic both food and non-food discounters continue to expand In Latvia. The most remarkable market entry in 2021 was done by LIDL that opened their first 15 stores at once in October this year followed by 2 more stores opened since then. Other discount brands such as Mere, FixPrice, Pepco and others continue to expand in Riga and in other notable cities,” says Jevgenija Kiselova, Associate Director at Colliers Retail Agency.
Discount retailers, both food and non-food, often play a crucial role in retail parks. Smaller retail parks are focused on the everyday shopper who visit them regularly, which is why food or non-food discount stores are typically the anchor tenants in the majority of such complexes. This trend applies to both the retail parks in main cities, as well as schemes in smaller towns. It is the result of the changing purchasing behaviour of CEE inhabitants. However, the growing interest in the location of stores within traditional shopping centres can be seen as well.
A huge potential for discount stores remains. A good proportion of CEE consumers are often buying goods in different shops, depending on which one offers the most favourable conditions. This “smart-shopping” trend is preferable for discount retailers. In addition, discounters appear to have suffered less in comparison to traditional retailers. Often located in smaller schemes, with outdoor parking and individual entrances, discounters have experienced slightly less disruption brought about by the different regulations or customer concerns during the pandemic.