1932 – 2012 Where People Make the Difference

SPAR International Annual Report 2011 Contents Managing Director’s Overview SPAR achieved outstanding growth in 2011 driven by our worldwide network of SPAR partners and 01 Managing Director's Overview independent retailers. This continues our excellent 08 SPAR International Board growth pattern during the global recession with a SPAR, Where cumulative retail sales increase of 16% over the last Success Stories: three years. 12 New Country Development People Make 14 Investing in our Supply Chain Consumer confidence remained low during 2011. This 16 Retail Formats driving Growth the Difference was driven by continued high levels of unemployment 20 Convenience Retailing at SPAR and concerns about savings and pensions. In addition, 22 Sports Sponsorship and SPAR wages remained under pressure as many governments 24 People Making the Difference 2011 was another good year implemented austerity packages which included higher 28 Customer Centred Innovation for SPAR. We are pleased to levels of taxation. 30 SPAR Working with Local Growers 32 Delivering Value to our Customers report our growth continued These factors, together with rising fuel prices, resulted in with SPAR worldwide retail reduced levels of disposable income and consequently, 34 SPAR Worldwide food expenditure remaining static or even declining in sales growing by €1.36 billion the majority of our markets. Competition intensified 50 SPAR Partners Worldwide to reach €31.1 billion, an with both national and international chains fighting for 52 SPAR International Action Groups market share. This resulted in increased promotional 53 Statistics 2011 increase of 4.6% on the activity and a strong focus on everyday low prices. previous year. Eighty years SPAR responded to the needs of our customers by after our foundation people placing a focus on fresh, convenient, value shopping in an exciting modern retail environment. The increase of continue to make the 4.6% in turnover to €31.1 billion is an excellent result in difference in SPAR. this very challenging trading environment.

Dr. Gordon R Campbell, Managing Director, SPAR International

SPAR International Annual Report 2011 1 Managing Director’s Overview There are now SPAR retail operations in 36 extended SPAR private label ranges. These include the Strong Growth in Key Strategic New Markets countries on 4 continents with the first SPAR stores launch of the SPAR Premium range in Italy and Austria, Dramatic increases in retail sales were achieved in opening in the United Arab Emirates, Malawi and the extension of S-Budget in five markets and its launch the key strategic new markets of China, Russia and Mozambique during 2011. Western Europe remains in Ireland and the UK. The launch of SPAR Sensations, India. SPAR International continues to support the The Performance the core SPAR market accounting for 65% of a health and beauty range, had a positive impact on SPAR Partners in expanding their retail and distribution worldwide retail sales. Eastern and Central Europe retail sales in Spain. operations as well as recruiting new partners. of SPAR in 2011 (15%) and Southern Africa (16%) are of increasing significance while the Asia pacific region (4%) is Eastern and Central Europe Growth accelerated in China in 2011: 25 new showing strong growth. Although economic conditions remained very difficult in hypermarkets and 25 supermarkets were opened, Retail Sales €31.14 billion Eastern and Central Europe we are pleased to report and although most of the new openings were in the Europe that sales increases were achieved in all countries. second half of the year, retail sales increased by 77% to Sales Increase 4.6% SPAR performed well across Europe with excellent sales SPAR Hungary and SPAR Slovenia celebrate their 20th €716 million. results in our larger markets including Italy (+6.2%), anniversaries with sales increases of 2.2% and 2.8% Sales Increase 3 Years 16.0% Austria (+4.5%), Belgium (+3.9%), Spain (+2.8%) and respectively. The Czech Republic (+5.3%) and Croatia In Russia retail sales grew by 21% to €935. Three the UK (+3.1%). Sales growth was driven by a number (+13%) also had positive results. new partners joined SPAR Russia, opening stores in St SPAR Countries 36 of factors, but the most important were new store Petersburg, Chelyabinsk and Krasnoyarsk in December. openings and the redevelopment of existing stores. Southern Africa This included the first SPAR hypermarkets in Russia. Stores 12,124 For example, SPAR Austria opened 89 new stores, SPAR South Africa had another excellent year. Retail Further new partners will be added in 2012. including their first city convenience stores, continued sales increased by 9% to Rand 47.2 billion (€4.6 billion). the rollout of SPAR Express, and upgraded 100 SPAR As in Europe, growth was achieved through new store Growth also accelerated in India; with a total of 10 Sales Area m² 6,440,853 stores. SPAR Italy opened 2 new hypermarkets and 19 openings and a strong focus on redeveloping and hypermarkets sales grew by 45% to €65 million. large EUROSPAR supermarkets. expanding existing stores. 25 new stores were opened and 126 upgrades completed. SPAR Australia underwent a great transformation in The SPAR multi format retail strategy played a key role 2011 with new ownership and new management. Retail in sales growth with a move into convenience retailing SPAR Zimbabwe continued its strong recovery, sales increased by 16% and there are good prospects in city centre and petrol forecourt stores in a number of opening a number of large Flagship supermarkets, for future growth. SPAR countries. Consumers are making less shopping and achieving a sales increase of 20%. Botswana and trips and prefer to shop nearer to home. Namibia delivered strong growth and Zambia made SPAR made a strategic move into the Middle East. good progress. The first supermarkets opened in The first SPAR supermarket opened in the United SPAR private label sales grew as a proportion of total Malawi and Mozambique. Nigeria opened its second Arab Emirates in Abu Dhabi. The UAE will provide the retail sales in all SPAR countries during 2011. Of large SPAR supermarket. platform for further expansion in this region. particular importance was the launch of new and

2 SPAR International Annual Report 2011 SPAR International Annual Report 2011 3 Managing Director’s Overview 80 Years of SPAR SPAR, Where People Make the Difference BWG Foods, operators of SPAR in Ireland, own the As we enter 2012 we begin to celebrate the 80th People have been making the difference at SPAR for fifth UK wholesale company Appleby Westward, which anniversary of the foundation of the unique SPAR more than 80 years. The core competitive strength is based in the South West of England. BWG Foods partnership. Founded in The Netherlands in 1932 by of SPAR has been the free and open exchange CEO, Leo Crawford, serves as Chairman of SPAR 80 Years of Adriaan van Well with the slogan “Door Eendrachtig of knowledge and information between the SPAR International. Samenwerken Profitieren Allen Regelmatig” – countries. This exchange has been actively facilitated People Making through joint co-operation all benefit. over the years by the dynamic leadership of many SPAR In Spain, Managing Director, Ángel de la Torre, has partners through our International Board, at the annual worked ceaselessly for SPAR at wholesale, retail and the Difference The SPAR system enables retailers to work together International Congress and through our many working central office level since 1959. He has given 53 years of purchasing from their regional Distribution Centre, parties and seminars. dedicated service, and continues to drive growth in an sharing all the advantages of joint buying, national extremely difficult market. We celebrate 80 years of SPAR promotions, and private label. The SPAR retailers can And today in SPAR people continue to make the in 2012. Our founder, Adriaan focus all their attention on their customers’ needs difference. The Reisch, Drexel and Poppmeier families, South Africa has played a very active role in SPAR so that at SPAR our customers can be treated as an founder members of SPAR Austria, continue to drive International. This year they host the 57th International van Well, had a vision that if individual by an individual. growth in Austria and the Aspiag countries, with total SPAR Congress. Their CEO, Wayne Hook serves on the retailers worked together in retail sales in excess of €12 billion. Three generations International Board, and his predecessor Peter Hughes This partnership has given SPAR a unique competitive of the families have given service to SPAR Austria, was a long term member of the Board. partnership all would benefit. advantage and has driven the expansion of SPAR first Aspiag and SPAR International and contributed to the Could he have imagined that throughout Europe and then into developing markets. worldwide success of SPAR International. In Norway the Johannson family has been a very active today SPAR would be the It has enabled our new partners in emerging markets supporter of SPAR. NorgesGruppen Chairman, Knut to learn quickly and to introduce modern attractive The Board of DeSPAR Italia under the leadership of Hartvig Johannson has served for many years on the world’s largest voluntary retail retail store concepts and to introduce state-of-the-art Mr. Gatto have driven strong growth in the last decade International Board. chain? supply chains. and will accelerate their expansion further with the recruitment of five new partners. They anticipate 350 The new SPAR partners are also making a difference SPAR is the world’s largest voluntary retail chain with new stores and a sales increase of 20% when all the participating actively in our conferences, seminars and 12,124 stores in 36 countries. Together with our new stores are integrated into SPAR formats. study tours. They bring renewed life and vigor to the multiformat retail strategy, this gives our customers a worldwide SPAR organisation. choice to shop at SPAR hypermarkets or supermarkets In the UK A.F. Blakemore recently acquired the Capper or to shop in a SPAR neighbourhood or convenience & Co regional wholesale business. Three of the other We have been fortunate to have SPAR partners who store. Our network of independent retailers specialise in four regional wholesale companies are owned and provided vision and leadership over the last 80 years. personal friendly service and in the provision of regional managed by their founders, namely the Agnew, Hall Many of them have been recognised by the award and local products. and Lang families. All four families have given many of the Van Well Medal, first awarded to our founder years service to SPAR UK and SPAR International. Adriaan van Well.

4 SPAR International Annual Report 2011 SPAR International Annual Report 2011 5 Prospects for 2012 SPAR South Africa, now the second largest SPAR In our core Western European market we anticipate country, is by far the major SPAR presence in Africa. It SPAR retail sales will continue to grow in 2012 at faces many economic and demographic challenges but least at the same level as in 2011. We can expect continues to deliver strong year on year growth. SPAR another year of strong growth in Italy following their is now present in eight sub Saharan African countries successful recruitment of new partners. SPAR is and our presence will be further strengthened through responding to consumer needs through our multi new store openings in these markets in 2012. format retail strategy which meets all shopping missions from full weekly shopping for the family The prospects for the new strategic countries are to stock up, to daily fresh products to express excellent. In China, the majority of new store openings shopping for convenience items and food to go. in 2011 were in the second half and these will deliver full year sales increases in 2012. In addition, they plan The macro economic outlook for 2012 looks more to open 30 hypermarkets and 70 supermarkets positive than in 2011. The United States and German during 2012. economies have returned to growth and are generating employment. There is evidence of growing confidence In Russia, we expect to end 2012 with 10 SPAR in the Euro and early indications that the major financial partners. We are targeting retail sales of €1.3 billion, crisis in the Eurozone countries is easing. a 40% increase, which will make SPAR the 7th largest food retailer in Russia. Three new partners were added Consumers continue to place a strong focus on value in 2011 and a further three will be recruited in 2012. and convenience and express a preference for fresh and healthy food choices. SPAR is well positioned to In India we are seeking new partners to extend our satisfy these consumer needs. All SPAR countries are geographic coverage of the market. In the Middle further improving their fresh offer not only in fruit and East we will expand our presence in the United Arab vegetables but also in bread, delicatessen, fresh meat, Emirates, in Abu Dhabi and Dubai. SPAR will open in and food to go. Qatar in the second half of 2012. We will also seek opportunities to enter other markets. Trading conditions in Eastern and Central Europe will remain difficult in 2012. However, a combination of new Dr. Gordon R Campbell, store openings and innovative marketing programmes Managing Director, SPAR International will ensure growth continues.

6 SPAR International Annual Report 2011 SPAR International Annual Report 2011 7 Peter Blakemore Gerhard Drexel Claudio Giannetti Henrik Gundelach

InterSPAR Executive Meeting Leo Crawford Wayne Hook Knut Johannson Gordon Campbell Tobias Wasmuht

The A.J.M. van Well Award Winners SPAR International Board InterSPAR Executive Committee

SPAR has been well served by the organisation’s leaders over the last 80 years. These leaders have built Chairman: Leo Crawford Chairman: Leo Crawford SPAR on the initiative and founding vision of Adriaan van Well. Members: Members: International Board Some of these leaders, who have made an outstanding Gerhard Drexel A Gerhard Drexel A contribution towards the development of SPAR in their Henrik Gundelach DK Karl Feurhuber A own country and who have inspired and supported Leo Crawford IRL Henrik Gundelach DK The SPAR International Board their colleagues in the worldwide organisation, have Claudio Giannetti ITA Finn Degn Ovesen DK met on 4 occasions in the last been acknowledged with award of the van Well medal. Knut Johannson NOR Stefan Knäbke D year. The meetings were held Wayne Hook SA Leo Crawford IRL The A.J.M. van Well Award Winners: Peter Blakemore UK John Clohisey IRL in Norway, Washington, Preston 1964 Mr A.J.M. van Well Gordon Campbell SPAR INT Claudio Giannetti ITA and Amsterdam. The Meeting in 1965 Mr H. Reisch Tobias Wasmuht SPAR INT Martin Pircher ITA 1968 Mr W. Hagen Knut Johannson NOR Norway was held in conjunction 1970 Mr H.A. Holland Bjorn P. Bendiksen NOR with the Annual Meeting of the 1972 Mr H.K. Green Wayne Hook SA InterSPAR Executive. 1976 Mr B.J. Elkins 1932 – 2012 Dan Maluleke SA 1977 Mr E.A. Mayer Peter Blakemore UK 1978 Mr L. Drexel Kevin Hunt UK The principal focus of the SPAR 1982 Mr E.S. Hall Gordon Campbell SPAR INT 1982 Mr W. Zauner Tobias Wasmuht SPAR INT Board remains on the continued 1994 Mr J.G.A. Irish growth and development of the 1994 Mr H.J. Zijderveld worldwide SPAR organisation, 1997 Mr B.A. Schmidt 1999 Mr R. Burnhill with a focus on the expansion 1999 Mr. F.Th. Poppmeier of SPAR to new countries. 2001 Mr H. Drexel 2003 Mr N. Nishio 2005 Mr H.M. Reisch 2007 Mr P. Hughes 2008 Mr I. Hall

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New Country Development Albert Gusev building his business. Throughout the SPAR Worldwide organisation, there Recognising the emerging opportunities in retailing, SPAR International continues to drive new country are many outstanding SPAR Managers and their teams Albert secured from SPAR International the SPAR development as a key strategic objective. The strategic who together have built excellent SPAR businesses at Licence for the Middle Volga and surrounding regions a local, regional or national level. Albert Gusev and Yuri in 2003, and has developed a chain of company owned focus remains on the large high potential markets of China, Markin have together built such a business in SPAR stores and independently owned SPAR stores. The Russia and India. Considerable progress was made in Middle Volga, which is the largest of the 9 SPAR Russia team at SPAR Middle Volga has been hugely successful Partners. Like many SPAR entrepreneurs, Albert’s in providing their customers with international best each of these markets in 2011. Expansion also continues first involvement with retail was through establishing a practice retailing. in sub-Saharan Africa. SPAR entered the Middle East with wholesale distribution business. the first supermarket in the UAE. Expansion and growth are at the heart of the continued success of SPAR.

New country development remains vital for the future Sustained growth also describes the progress made success of the SPAR brand. Each new country by SPAR China in terms of retail sales, selling space makes its own unique contribution to the culture and and store numbers. With strong growth in the second development of worldwide SPAR and strengthens the half of 2011, SPAR China will soon see sales exceed organisation. The last year has seen the achievement of €1 billion. This momentum will be carried into 2012 a number of key milestones. when it is planned to recruit new SPAR partners.

In China and Russia significant progress has been The focus in China will be on the continued development made, with the SPAR Partners making major investment of SPAR with 2 formats – the SPAR Hypermarket, which in retail selling space, in recruiting independent retailers today accounts for the majority of sales and the SPAR and investing in modern distribution centres. supermarket, which is a newer format in China.

2011 has seen important developments by SPAR in 2011 saw the launch of SPAR in the Middle East with Africa, with the foundations being put in place for a the opening of the first SPAR supermarket in the United strongly growing SPAR business in a number of African Arab Emirates (UAE). SPAR UAE worked closely with Countries. The last year has also seen the opening of the retail development and design teams of SPAR the first SPAR store in the Middle East. International to create a supermarket proposition that delivers an international shopping experience based There have been significant developments in Russia on the SPAR brand retail values of freshness, quality, in the last 12 months, with continued growth and convenience and friendly personal service. consolidation by existing partners, the recruitment of four new partners and the launch by SPAR of a new The last year has seen important progress in the format, with the opening of SPAR Hypermarkets in Tula development of the SPAR brand in Africa with the and Chelyabinsk. opening of the first SPAR supermarkets in Malawi, Mozambique and Nigeria. These stores are performing The new Partners are successful regional retailers, who strongly and are ahead of plan. have developed a leading position in their local market, but who now see the value of the support offered by SPAR has also enjoyed excellent growth in Zimbabwe an International brand such as SPAR. With retail sales and Zambia, with ambitious plans in place to drive the now exceeding e935 million, SPAR is well positioned to continued growth of the SPAR business. become a major retailing brand in the Russian market.

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Investing in our Supply Chain SPAR Netherlands open new Distribution Centre and Offices SPAR Netherlands opened its new distribution centre The new 23,000m2 distribution centre is designed A major investment in developing and modernising and head offices in September 2011. Sjaak Kranendonk, to meet the needs of the independent SPAR retailer, the supply chain has underpinned the sustained Managing Director, SPAR Netherlands, underlined by providing a regular delivery of fresh and ambient the importance of the neighbourhood supermarket products in a cost efficient manner. The DC is growth enjoyed by SPAR Worldwide in retail sales. for local communities. He emphasised that the SPAR environmentally efficient, with surplus energy from the This investment in technology, capacity, transport and neighbourhood supermarket played a vital role in deep-freeze section used in the under-floor heating of supporting social cohesion in small villages by providing the grocery section and in the head office. The energy people, ensures that the required products are available both local shopping and employment. This is reflected efficient theme also applies to the new fleet of 50 low at store level at the right time and the lowest cost. This in the slogan ‘My neighbourhood, my SPAR’. carbon trucks. investment in established and new SPAR countries reflects the commitment to supply our customers with quality products in a cost effective manner.

In parallel to the major investment made at retail level, Over the last 5 years significant investment has been SPAR Partners have made significant investments in made in adding capacity to match the growth of the developing their supply chain capabilities. Examples of business and also in developing the capability to such developments can be seen in most Countries as deliver chilled and frozen product. The investment in SPAR seeks to continuously improve the efficiency of expanding capacity has accommodated significant its operations. growth in the volume delivered to SPAR stores, through a combination of adding capacity at existing distribution These achievements have only been possible with centres and also constructing new facilities. the enthusiasm and skills of management and staff in constantly seeking new ways to improve operational In the last year, SPAR Partners opened new distribution performance. centres, reflecting their commitment to growing their SPAR business. The family owned and managed James The implementation of new technology to improve all Hall, the North of England based SPAR UK wholesaler, aspects of operations is of particular importance. This opened a 35,000m2 facility. In the Netherlands, new technology includes the increased application of IT SPAR has relocated to a new distribution centre and and new advances in hardware. In recent years major head office, which will support improved service to investments in automation have been undertaken by SPAR retailers. SPAR partners. Investment in new warehousing facilities has also been The introduction of warehouse management software, undertaken in new SPAR countries. This has been RF scanning and voice picking have contributed hugely most notable in China, where all the SPAR partners to improved performance in warehouses. We also see have recognised the importance of investing in the major advances in transportation with the application development of their supply chain, in the context of an of scheduling and routing software and telemetrics, underdeveloped industry supply chain. resulting in significant advances in service level and 2 reduction in running costs and CO2 emissions. 2011 saw the opening by SPAR Shanxi of a 49,000m facility to service the rapid expansion of SPAR in Shanxi SPAR has also seen the increasing adoption of new and Inner Mongolia. We also see ambitious plans to approaches to working with suppliers, with increasing develop modern distribution centres by the SPAR emphasis placed on backhauling to increase the usage Partners in Russia, notably SPAR Middle Volga and of vehicles and reduce operation costs. SPAR Tula.

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Retail Formats driving Growth EUROSPAR: Tomás Barreto in La Palma, Spain In San Pedro, La Palma, in the Canary Islands the A strong communication campaign was developed for The average size of SPAR stores worldwide has independent SPAR partner, Tomás Barreto S.A., consumers, emphasising the increase of product range, increased by 27% in the last 5 years. This has been enlarged and converted a SPAR supermarket to a the expansion of fresh produce on offer, wider aisles EUROSPAR within only 20 days. Working closely with with improved quality of shopping experience as well driven by the SPAR multi-format strategy, particularly the retail design team at SPAR International, a modern as good value for money through targeted promotions. the introduction of EUROSPAR supermarkets and the design was created which suits the requirements of the local residents and tourists who shop in this supermarket The store has seen an increase in customer numbers INTERSPAR and SPAR Hypermarkets. Some 35% Work was carried out with the SPAR International resulting in a 20% rise in gross sales. The team at of global SPAR sales are accounted for by these two lighting supplier to develop an effective solution for this Tomás Barreto is embarking on a second conversion new layout and design that reflected the importance of of a store at Los Llanos de Aridane in consultation with formats. SPAR International has actively supported the service departments and the fresh food offer. SPAR Spain. the roll-out of these formats through the Flagship Programme and the Retail Design Manuals.

SPAR International works with the SPAR member approximately 6,000m2 selling area and retailing over countries in the development and introduction of the 20,000 items the stores provide a world class shopping SPAR retail formats through a programme of flagship experience to meet consumer demand. stores. Through this programme SPAR partners are able to draw on the worldwide expertise and best The strength of the SPAR hypermarket format lies in international practice by implementing tried and tested the proportionate mix of fresh foods, groceries and non international formats. food worlds. The new hypermarkets feature an onsite bakery producing more than 200 hot food lines, and In the last year SPAR International, through the the stores offer freshness and convenience as well as development of flagship stores, supported SPAR Spain choice and value. The initial results have been ahead in the Canary Islands and SPAR Norway. This work on of target and it is planned that the SPAR hypermarket developing flagship stores will support the on-going format will be opened in an increasing number of expansion of the EUROSPAR format in those countries. regions throughout Russia.

An important development in 2011 has been the In 2011, a total of 29 new SPAR hypermarkets were development of the SPAR supermarket format in Africa. opened in China. A highlight of 2011 has been the The large format SPAR supermarket was successfully opening of flagship SPAR hypermarkets as anchor sites introduced in new emerging markets such as Malawi. in major shopping centres developed and operated by SPAR International worked with the founders of SPAR the partners of SPAR China. Malawi to launch the 1st SPAR supermarket located in the capital Lilongwe. In the cities of Taiyuan, Qingdao and Dongguan, SPAR International in co-operation with SPAR China have The SPAR hypermarket format continues to be a major been actively developing a series of premium compact area of growth. At the end of 2011, SPAR operated hypermarket flagship stores targeted at the growing 235 hypermarkets worldwide. The launch of SPAR middle classes of China. In addition to a greater hypermarkets in Russia, India and China has continued proportion of fresh foods and delicatessen the stores to be a key focus for SPAR in 2011, and plans are also feature services, products and events targeted at advanced to introduce the format into new countries. creating a mother and child shopping experience. Working in collaboration with our SPAR partners in Russia, the first SPAR hypermarkets were opened In 2012, SPAR International shall support SPAR Italy in a in the cities of Tula and Chelyabinsk. Operating with series of flagship EUROSPAR and INTERSPAR stores.

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Convenience Retailing at SPAR Rapid roll-out of SPAR Express in Austria SPAR Austria launched SPAR Express in 2009, originally The modern store design combined with an assortment SPAR International identified the growing demand for in 6 stores throughout the country in co-operation with of 1500 products, including offering a range of freshly express shopping from consumers on the move. In the Doppler Group, one of Austria’s largest petroleum baked breads, regional fruit and vegetables has been operators. The initial test stores have seen dramatic well received by customers. response, the SPAR Express format was launched sales increases and have surpassed their expectations. which provided a modern shopping experience By the end of 2011, 28 stores were operational and Open 7 days a week the stores provide customers the expansion is on target to increase numbers to over convenience to shop when they require at supermarket designed to meet consumers’ needs for daily, stock 70 sites by 2013. In research published by a leading prices. The extensive range of SPAR own brand up, impulse and emergency purchases. A special business weekly in Austria, SPAR Express ranks highest products provides outstanding value and SPAR Express in the country for image and value leadership. is the price leader in the Austrian Forecourt sector. emphasis was placed on ‘Food to Go’ for the time pressed customers. SPAR Express has been strongly developed in Ireland and Germany but is now quickly spreading in new markets.

SPAR Express is a high convenience format particularly The range of products is broad from ‘Food to Go’, to successful in transient and high footfall locations such fresh, to dry goods, to non-food but the assortment is as forecourts, airports, railway station and city centres. very narrow. Hygiene and food safety are of a SPAR SPAR UK and SPAR Ireland have a long established standard and are therefore higher than in a normal core competence in the convenience sector. Today forecourt store, while customer service is friendlier and some 11 countries operate 650 SPAR Express stores. more personal than in a normal forecourt store.

SPAR UK with 2,500 stores at an average store size of More recently the format has extended across Europe, 143m2 continues to receive national and international notably in Germany, Austria and Belgium. SPAR recognition particularly in the petroleum and forecourt International has also successfully introduced the retailing sector. Operating 500 plus forecourt stores, concept into new countries. these international award winning stores have provided a great basis for the transfer of knowledge and Worldwide, SPAR Express convenience stores are also experience to SPAR country organisations. prospering with growth in store numbers being achieved with the format in Australia, Russia and Ukraine. Success in convenience retailing also underpinned the success of SPAR Ireland where the SPAR Express In the last year we have seen the emergence of the format was piloted as a dedicated format for the petrol SPAR Express format in Africa and Asia with the first forecourt market. Today there are 66 SPAR Express stores opening in Zimbabwe and China. stores operating in Ireland in petrol forecourt locations owned by independent retail operators. With a growing urbanised consumer class in these developing markets the future potential for convenience SPAR Germany has focused on the convenience sector and SPAR Express is excellent. with the SPAR Express format and today operates some 340 stores primarily in partnership with one forecourt The SPAR Express format continues to expand in more operator. SPAR Austria has also rolled out the SPAR and more countries worldwide. The SPAR Express Express format with a forecourt operator and currently format was introduced to Switzerland in 2011 with the operates 28 stores under this retail brand. opening of the first store which was integrated into an Avia branded forecourt location. SPAR Switzerland also While the SPAR Express concept differs from country plans to expand with the format in high footfall location to country in terms of store size, product range, and in city centres. pricing policy there are a number of common features.

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Sports Sponsorship and SPAR SPAR UK Brand Ambassador As the official sponsors of UK athletics, SPAR has a Underlining the close link of SPAR to UK athletics it SPAR International confirmed it will continue as principal deep involvement at all levels with the sport. The is very appropriate that Jenny Meadows, a leading sponsor of the European Athletics Championship SPAR Sprints Initiative is but one of a number of sports woman athlete, has agreed to be the SPAR Sports related sponsorships undertaken at local, regional Ambassador. Jenny in a recent interview about her Events for another four year term. For the first time and national level by SPAR UK retailers and Regional role said “It is fantastic that SPAR has been supporting this will include two European Championships, Wholesalers. Through this Initiative SPAR UK provides athletics for so long and I am very pleased that such training, motivation and support to young high potential a big brand has backed athletics the way they have, Helsinki June 2012 and Zurich August 2014. SPAR sprinters. Eight talented British sprinters, selected by and am delighted that they have chosen me to be their builds international awareness of its brand through the UK athletics, will receive financial support and other ambassador for the sport.” benefits to assist them make the transition from junior massive TV and press coverage of these prestigious to senior athletics. events. This sponsorship is part of our commitment to encouraging active healthy lifestyles.

The SPAR Sponsorship of European Athletics in 2011 SPAR is committed to a great variety of sports featured 3 events, which enjoyed a total audience of sponsorship in addition to European Athletics. The 235.3 million viewers for the 651 hours of television scope of sponsorship extends from individual retailers coverage to some 78 countries. sponsoring a local school to national events which are varied. The flagship event in the last year was the European Indoor Championships held in Paris. This event, In the last year these include the SPAR sponsorship which attracted a total viewership of 170 million, also of the Unihockey Women World Championship in demonstrated the value of sponsorship in terms of Switzerland, the Zimbabwe Sevens Rugby Team and promoting the brand. the SPAR Great Ireland Run in Ireland. The latter event attracted more than 11,000 adults and children for SPAR France used the event as an opportunity to Ireland’s largest mixed 10km run. involve retailers in the event, while SPAR UK linked the event with its sponsorship of junior athletes ‘The SPAR SPAR Norway has for many years given its support to Sprints Initiative’. ‘Right to Play’, a now global initiative to support social development through sport in the poorest countries, The international scope of the sponsorship is underlined which was founded originally by a Norwegian athlete. by the fact that the other two events in the annual programme; the SPAR European Team Championship The vision of Right to Play ‘to create a healthier and and the SPAR European Cross Country Championships safer world through the power of sport and play’ is one were held in Sweden and Slovenia, respectively. that SPAR retailers and staff strongly identify with and support by raising funds through selling red mini-balls 2012 marks the beginning of a new 4 year cycle of which have become the symbol of the organisation. sponsorship by SPAR International as the principal sponsor of European Athletics, which will run until 2015. The focus on wellness and active healthy living is an important part of the Corporate Social Responsibility The highlight for 2012 will be the European Athletics Programmes adopted by SPAR countries. It also Championships in Helsinki, which for the first time reflects the commitment to community and people, will be held during an Olympic year. This event will be core values of SPAR for 80 years. based in Helsinki from June 27th to July 1st and is part of summer of sport leading up to the London Olympics.

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People Making the Difference China Academy SPAR China has received national recognition for its industry in China. This award shows that SPAR China In an increasingly competitive environment, it is vital SPAR China Academy. In a recent award ceremony, the has been recognised as a leading company within the to differentiate the SPAR retail proposition and build China Chainstore and Franchise Association presented Chinese retail industry.” SPAR with the prestigious award for ‘its highly innovative long-term relationships with our customers. SPAR Online Training Academy for retail employees’. He further commented that trainees can watch best people have succeeded in making a difference for practice videos online, giving examples of successful Tobias Wasmuht, Managing Director of SPAR China retail tips and advice from other SPAR countries, our customers through our core values of freshness, said: “We are delighted that our work and team efforts adapted to suit the market in China. The Academy is quality, value and outstanding customer service. SPAR have been celebrated by the rapidly growing retail available to SPAR employees in all regions of China. International continues to support the exchange of best practice in customer care and people development through our programme of conferences.

SPAR Partners undertake a major investment each SPAR Austria received the Austrian Integration Award year in the recruitment, development and retention of in recognition of the success of their apprenticeship talented management and staff. This investment in our training. The commitment to developing people is also social capital goes hand in hand with the investment evident in new SPAR Countries, with National awards in new stores and supply chain. This commitment to being achieved in China and India. investing in people ensures that throughout the SPAR worldwide organisation, SPAR consistently delivers The growing commitment to the development of our on outstanding customer service. This is even more people is seen in the increasingly important role that important in an increasingly competitive environment. SPAR academies play in delivering a programme of training for SPAR management and staff. The first The commitment to customer service has always been academies were established in Austria and South part of the SPAR philosophy from our origins in the Africa, where management recognised the need to Netherlands in 1932 as a network of family owned and invest in training but also to design and develop material managed wholesale and retail businesses. 80 years tailored to SPAR. later, SPAR remains committed to the same family values of respect and concern for our community, Today the SPAR Academy in Austria is the largest colleagues and environment. training company in the country with more than 2,700 trainees. In South Africa, SPAR invested more than 3% Because of the focus we place on people, great of total payroll on skills development. attention is paid to the attraction and recruitment of new colleagues to ensure that SPAR is identified as The concept of the SPAR Academy has today been rolled an employer of choice. SPAR Austria and SPAR South out to many SPAR countries, with SPAR organisations Africa have pioneered initiatives in the area of employee increasingly implementing training tailored to the needs branding to attract talented new colleagues to SPAR. of their market.

The investment by SPAR Partners in training and A number of SPAR countries have developed Virtual development results in many SPAR organisations Academies, whereby training material is made available achieving national recognition. The commitment to online to retailers and their staff. Training can be developing people has won training awards presented undertaken at times convenient to the individual. Among by industry bodies recognising excellence. In 2011 the the countries actively engaged in the development and SPAR UK Regional Companies again dominated the roll-out of SPAR academies are the UK, Norway, Ireland, industry training awards. Switzerland, Netherlands and China.

24 SPAR International Annual Report 2011 SPAR International Annual Report 2011 25 26 SPAR International Annual Report 2011 SPAR International Annual Report 2011 27 Success Stories Success Stories

Customer Centred Innovation SPAR Slovenia – Implementing a SPAR Loyalty Card

SPAR Slovenia’s Managing Director, Igor Mervic,√ has In response to this shift, SPAR Slovenia introduced a SPAR Countries have actively embraced the advances recognised the strategic importance of implementing a SPAR loyalty card in 2010. The goal of the ‘SPAR Plus in technology over the last decade in order to better sustained customer loyalty programme. In the past two Card’ was to gain 300,000 holders in the first year, years, Slovenia has experienced a shift in consumer with 50% of turnover using loyalty cards. The launch meet the needs of our customers. Many countries are shopping behaviour with customers shopping in a was well advertised with billboards, leaflets, posters exploiting the opportunities offered by social media, range of supermarkets in order to obtain the best value and website information. The programme was an for money. This resulted in a reduced basket spend per outstanding success, achieving 400,000 cardholders the development of applications for smart phones visit and a focus on promotions and discounts. and 70% turnover by year end. and the opportunities offered by loyalty cards to build relationships with our customers. SPAR International promotes innovation in retail and supply chain through its programme of flagship retail stores and distribution centres and the work of its Action Groups.

The major advances over the last 2 decades in the SPAR Czech Republic has rolled out an application application of technology combined with the revolution which offers a free download which customers can in ICT have impacted on all aspects of retail. We have browse to locate stores, look for recipes, make a seen the introduction of new retail technology, the shopping list and download promotional flyers. A increased application of modern web based IT, the highlight is that customers can select products from the emergence of a new retailing channel eRetailing; the promotional flyers and add them to their shopping list. increasing role of smart phones in our business for both communication and transactions and the ever Other innovations with mobile technology include the increasing importance of social media. development of cashless payment. SPAR Switzerland has pioneered the implementation of such a system. SPAR partners worldwide have responded positively SPAR UK have played a leading role in promoting the to the opportunities offered by the new technologies introduction of contactless cards in their market to to communicate with SPAR customers, to improve speed up the payment process for smaller purchases. customer service and also reduce operational costs. They are also increasingly recognising the opportunities Customers at SPAR and INTERSPAR stores in Hungary offered by social media to communicate with customers can pay using their mobile phone. SPAR have partnered by developing a two-way dialogue. with two of the largest mobile providers in order to offer this service. SPAR retailers in Denmark, Norway Today we can find our customers using social media and Spain are investing in the latest generation of cash to discuss SPAR products, the local SPAR stores and management systems. the product range in online discussions. We recognise the importance of ensuring that SPAR facilitates these SPAR International has worked closely with the SPAR discussions and actively engages in them to ensure that Partners to facilitate the adoption and integration of the the brand values are communicated in a consistent way. advances in technology, by facilitating the exchange Many SPAR countries have launched Facebook and of knowledge on developments through its Action Twitter pages to be part of this increasingly important Groups and the publishing of reports and newsletters method of customer communication. tracking new applications and sharing the experience of individual SPAR retailers and wholesalers. The development and spread of smart phones has created the opportunity for SPAR to focus on The STOREIT reports have monitored developments implementing mobile applications. Many SPAR in retail technology, while a series of reports on social Countries have started to innovate using the functionality media have prompted the undertaking of a joint FACEBOOK PAGE offered by smart phone technology. Facebook Promotion in the first half of 2012. TO GO IN HERE

28 SPAR International Annual Report 2011 SPAR International Annual Report 2011 29 Success Stories Success Stories

SPAR Working with Local Growers Working in partnership with local producers – SPAR South Africa The SPAR retailers of South Africa are leaders in African government, has access to land and irrigation. Local sourcing from regional growers is integral to the developing sustainable partnerships between the local Resources such as seedlings, fertilizers, machinery, SPAR way of doing business; it is part of our brand farming community and the local SPAR store. One of diesel and transportation are financed through the pioneers of this approach is SPAR retailer Philip micro loans provided by the SPAR retailer. A SPAR and our philosophy. SPAR has an 80 year tradition Snyman, who works in partnership with local farmers agriculturalist also provides training and knowhow to of working with local producers and supporting local to guarantee purchases of fresh produce for his stores. improve the farmer’s yield and produce quality. communities. The Strategy2Sustain Initiative of SPAR The initial model started with 27 farmers for a single The partnership between the retailer and the farmers is International highlights important examples of best store and has scaled up across South Africa. The a formalised contract, which states the produce to be local community, with the support of the South grown, the selling price and the quality standard. practice in local sourcing throughout the SPAR world. SPAR International also works with government and development agencies in sourcing partnerships to support local growers.

SPAR, being locally owned and operated, has a long The award was made to Conrad for his passion and standing tradition of over 80 years of working directly drive to promote local producers and their products. with local producers. Today, regionalism and the ability Each item is displayed highlighting its origin and the to procure directly from the source is a key form of distance travelled to the store. This initiative has been differentiation for SPAR retailers across the globe. commended by the former Welsh Minister for Rural Affairs, Elin Jones, for the support given for local From the valleys of Wales and the mountains of Norway sourcing of Welsh food and drink. to the Venda farming communities of South Africa, our proudly local SPAR stores ensure that they are sourcing Another illustration of this co-operation can strongly be from the region for the region. The best demonstration found in Austria, where SPAR sources from regional of the commitment to local sourcing is through a Austrian regional growers. By sharing a passion for number of examples drawn from different parts of the food and a belief for the need of authenticity in food SPAR world. production, SPAR work together with small and specialist producers observing generations of tradition The philosophy of working with local producers is also in producing unique and exceptional foods. evident in the UK where the regional SPAR wholesaler Blakemore’s has championed sourcing from regional This co-operation provides an important access to and local producers through its specialist company, retail distribution for smaller family owned producers. Heart Distribution. This approach has been embraced At present, SPAR Austria works directly with 560 by their customers and independent retailers. local suppliers to source over 5,300 products for its INTERSPAR hypermarket division, thus providing often A particular strength is the ability of independent small scale producers with large scale opportunities to retailers within SPAR to work directly with producers develop and prosper. The establishment of the SPAR and growers from their locality. own brand ranges such as SPAR Natur*Pur, SPAR Wie früher and SPAR Premium places a strong emphasis An excellent example is the initiative of a SPAR retailer, on rediscovering the taste of authentic regional foods. Conrad Davies who owns and operates 2 EUROSPARs and 1 SPAR store in Wales. Conrad Davies was named A large scale example of this SPAR spirit of co-operation True Taste Champion of Wales in recognition of his is found with the purchasing by SPAR Austria of 100 support for local Welsh food producers. million apples from apple growers in the region of Styria.

30 SPAR International Annual Report 2011 SPAR International Annual Report 2011 31 Success Stories Success Stories

Delivering Value to our Customers SPAR Austria offering value through Private Label SPAR Austria has developed the most comprehensive to their customers who look to their retailer of choice to SPAR Partners worldwide have responded to the private label range, responding to the needs of its meet their needs in terms of price and quality as well as ever increasing importance of value and price to our customers. The company’s strategy is to offer a full issues concerning production. range from discount through to best in category. customers. Value is delivered through a combination The private label offer has been expanded to offer a of competitive pricing, added value promotions and The SPAR Private label remains the core range, but is core range focused on price and value, and a number supported by niche ranges. The success of this strategy of niche categories including organic, Vital, Fairtrade, an enhanced SPAR private label range. By actively is seen in the growth of private label to 29.8% of sales. Free From products and the S-Budget discount range. growing our SPAR Private Label ranges we are Over the last 5 years SPAR Austria has extended the SPAR Premium was recently launched with the focus role of private label in its business in order to respond on affordable luxury products. providing our consumers with quality and value. The International SPAR brands continue to complement the national SPAR ranges.

Consumers globally have responded to the financial SPAR countries. More than 20 SPAR Partners are now crisis by placing more attention on value and price. This sourcing their international SPAR brands through our applies to all forms of shopping; from the weekly food logistics facility in the Netherlands. This facility enables shop through to shopping for apparel and household SPAR International to supply our Partners with full goods. The emergence of web services offering price or mixed containers of an ever increasing range of comparisons has also accentuated the focus on price. internationally sourced products. In response retailers have developed private label ranges to offer customers better value and savings In 2011 this service was extended beyond Western without compromise on quality. and Central Europe to Russia, China, Zambia and Zimbabwe. The international dimension of these SPAR countries have been actively engaged in the products is reflected in the families of products available development of comprehensive private label ranges to including Italian, Mexican and American ranges. SPAR offer consumers the range of products they require to International also supplies a full package of POS support meet the requirements of their family in terms of quality, emphasizing the internationality of the products but nutrition, variety and price. also the quality price relationship.

The range of international SPAR brands sourced and Over the last 5 years all SPAR partners have extended marketed by SPAR International continue to play an the role of private label in order to respond to the important role in supporting the national private label increasing focus by consumers on value. SPAR Italy ranges. Working with the support of the BIGS buying has launched a 200 strong range of products targeting group a number of important new products were added consumers wishing to help the environment through to the 350 sku international range. their shopping. SPAR Switzerland introduced a new range produced according to strict organic guidelines By pooling the volumes of these products on an tailored to the demands of the Swiss customer. international level, SPAR International uses a transparent tendering process to ensure that the best quality/price In Spain, the Sensations range of cosmetics which was ratio is achieved. This process also ensures that the introduced in the last year as an exclusive brand for participating SPAR countries can offer their customers SPAR has proved a winner with the price conscious good quality products at great value prices. consumers. SPAR Netherlands have introduced a new product range called ‘SPAR from the region’ developed SPAR International through its trading company, IGT, in response to the growing demand from customers for now provides a full sales and logistics service to the locally sourced produce.

32 SPAR International Annual Report 2011 SPAR International Annual Report 2011 33 SPAR Austria have SPAR Austria has developed SPAR Middle Volga Our global family... rolled out SPAR Express a comprehensive range of providing consumers with on Petrol Forecourts private label products best practice retailing

SPAR Netherlands opened its new DC to meet the needs of retailers

UK athlete, Jenny Meadows, is the SPAR UK Brand Ambassador

Tomás Barreto SA, Canary Islands, converted an existing store to EUROSPAR SPAR Slovenia launch SPAR China Academy ‘SPAR Plus Card to wins national award reward loyal customers’ for training initiative

Western Europe Austria, Belgium, Denmark, France, Germany, Greece, Italy, Ireland, Netherlands, Norway, Portugal, Spain, Switzerland, United Kingdom.

SPAR Retailers in South Eastern Europe Croatia, Czech Republic, Hungary, Poland, Africa lead in developing Romania, Russia, Slovenia, Ukraine. local sourcing

Africa Botswana, Malawi, Mauritius, Mozambique, Namibia, Nigeria, South Africa, Zambia, Zimbabwe.

Asia Pacific Australia, China, India, Japan, UAE.

34 SPAR International Annual Report 2011 SPAR International Annual Report 2011 35 Western Europe

Belgium

Denmark France

Austria

enjoyed continued During 2011 an additional 750 jobs continued to is the largest recorded a SPAR Austria SPAR Belgium SPAR Denmark SPAR France success in the last year with retail were created. This resulted in SPAR experience growth in 2011, with chain of independent retailers growth in store numbers to 956 sales growing by 4.5% to a record now employing 38,800 persons, of retail sales increasing 3.9% bringing nationwide. The introduction of the during the year, 765 of these are €5.36 billion. Retail space now which some 2,700 are apprentices. their total sales to €814 million. EUROSPAR format has helped to franchise operated stores, which exceeds 1 million m2 and the number These numbers confirm the position strengthen the SPAR brand. represents an increase of 1.6%. of SPAR outlets increased to 1,470. of SPAR as the largest private SPAR is operated in Belgium by Total retail selling space over the employer in Austria. SPAR Retail (part of the Colruyt A period of consolidation was entered period also increased to 245,000m2. Throughout the year 80 SPAR stores Group) and Lambrechts N.V. into this year. Store numbers fell to were upgraded. To ensure that all A huge importance continues to SPAR Retail is responsible for 229 504 and retail selling space declined Retail sales in France remained at communities have access to a local be placed on Corporate Social stores, 217 of which are operated to 170,309m2. Total retail sales €970 million throughout the year. SPAR store some 70 new stores Responsibility. Their contributions by independent retailers and decreased 3% to €1.07 billion. The This is an excellent performance were opened in small communities, to charity totalled €750,000 by the Lambrechts N.V. is responsible for performance is reflective of the very as the economy recovers from some of which only number a few end of the year. 62 stores, all of which are run by difficult economic environment, as recession. hundred inhabitants. independent retailers. unemployment figures are rising As a pioneer in climate protection and GDP levels decreasing. Lower than expected growth and SPAR Austria has continued with SPAR implemented the first full SPAR Retail undertook significant increased unemployment rates their roll out of SPAR Express hybrid truck in Central Europe. investment in advertising during the A major investment in a new impacted negatively on government petrol station stores, increasing The hybrid truck has 20% less fuel year. The highlight of this programme neon-light technology started this revenues and increased borrowing

numbers by 50%. This expansion consumption and CO2 emissions is a SPAR tram which ran along the year, which saves the climate the costs. This has resulted in a fall in

will continue in 2012, with a plan than a conventional truck. coastal cities of Belgium on one of equivalent of 73 tons of CO2 per consumer confidence. to open a further 60 SPAR Express the longest tram routes in the world. year and reduces electricity bills. stores on petrol forecourts. SPAR became a member of WWF This gained valuable advertising The dominant store format in France Climate Group, Austria’s biggest exposure for SPAR in Belgium. This To help make the project more is the SPAR supermarket. These Convenience was the major focus private climate initiative at the start advertising initiative commenced in attractive to SPAR retailers, SPAR stores provide a wide assortment of the last year. In Vienna, Salzburg of the year. mid 2011 and will run for 12 months. Denmark have negotiated a bonus of products that meet customer and Innsbruck SPAR opened its of 2% per saved kWh. This means demands. The range of produce first three convenience stores In cooperation with WWF, SPAR To increase awareness of the tram, that the €37,000 investment is flexible, with an increasing focus specifically targeted at people developed measures to protect a competition was created for generates €13,000 per year in on the supply of regional and local living in cities. This new store type the climate, with ambitious targets customers to take photos of savings. As a result, retailers have goods. Stores also offer extended is called ‘Food in the City’, offering to be achieved over the next three themselves with the tram and then changed 1,600 light fittings to this opening hours and customer a wide assortment of products years. The company has also taken submit the images to win a prize. new neon light technology. services such as free Wi-Fi. available both in ‘Food to Go’ and a stance against overfishing and ‘Food to Stay’. species protection.

36 SPAR International Annual Report 2011 SPAR International Annual Report 2011 37 Western Europe

Germany Italy

Greece Ireland Netherlands

performed faced an further returned to Verde, meaning Green Choice. The achieved SPAR Germany SPAR Greece SPAR Ireland DeSPAR Italia SPAR Netherlands well in 2011. The focus remained exceptionally difficult retail consolidated its position as the growth in 2011 with total retail sales 200 strong product range is retail sales of €491 million this on the development and expansion environment this year. Total retail premier convenience brand in increasing 6.2% to €3.9 billion. This designed to appeal to customers year, a marginal decrease of 1% of SPAR Express stores nationwide, sales declined marginally to €683 Ireland achieving some significant was a significant growth considering that want to help the environment since 2010. This is a satisfactory with store numbers increasing million, which is an outstanding milestones during the year. The the difficult retail environment. through their daily shopping. The performance as market conditions to 340 by the end of the year, result as the Greek economy group added to its flagship stores range comprises products from proved difficult with considerable representing an increase of 10%. continued to experience a decline in with the opening of two new stores Store numbers also increased during organically farmed food items to pressure on price. The average store size is 80m2. consumer spending. at Dublin’s national airport as well as the year. There are now 1,549 stores energy saving light bulbs. a store on one of Ireland’s busiest in Italy representing an increase of A new DC and Head Office was The majority of SPAR Express stores The total number of stores remains motorways. They also achieved a 4% since 2010. 517 of these stores The first issue of DiVita magazine opened by SPAR Netherlands in Germany are located in petrol at 189 with a retail sales area of milestone with their digital and social are company owned. was made available to customers during the year. This new DC is forecourts, in particular they have 142,700m2. During the year one media programme when SPAR this year. With a fresh look and feel, designed around the needs of the strengthened their relationship with new store was opened, while an Facebook reached 50,000 fans. SPAR operates stores under three DiVita covers a range of health and independent SPAR retailer. Jet/Conoco, the major oil company. underperforming store was closed. formats in Italy – neighbourhood environment conscious topics. SPAR Ireland reported total sales of supermarkets, EUROSPAR and The past year has seen SPAR focus SPAR Germany will continue Consumer behaviour in Greece has €1.12 billion. This represents a 5% INTERSPAR. The majority of turnover There were several major on their sustainability strategy. They to expand on this success by changed. Customers now plan their decrease from 2010, but is a very is accounted for in the larger format developments throughout the year. have taken the lead in a project to partnering with other major petrol shopping list, therefore eliminating strong performance in the context stores, which are company owned. Five new companies joined the reduce CO2 emissions and noise companies. The first SPAR Express impulse purchases. Consumers are of the difficult economic conditions. However, the independently owned, consortium, and as a result of this, pollution. 50 new sustainable lorries store was opened in partnership looking for budget products without local supermarkets, also remain a turnover is expected to reach €5.4 began serving SPAR neighbourhood with Shell in 2010, this year saw sacrificing on quality. 2011 saw continued investment in key part of the future business. billion in 2012, representing an supermarkets late this year. The aim a further 14 stores open on Shell the growth and development of increase of 40%. The number of is to achieve a reduction in CO2 petrol forecourts. It is anticipated According to Nielsen data, both SPAR own brand, which resulted in Product offering has been a major stores are also projected to increase emissions and a reduction in diesel that this partnership will be further turnover and the sales volume of a 10% growth in sales of the range. focus through the development of to 2,000. consumption of 160,000 litres. strengthened next year. branded products has decreased, high quality private label products while private label sales have SPAR Ireland also introduced at affordable prices and also The new companies are based in A new private label range ‘SPAR A new design and layout for SPAR increased. In 2011, SPAR Private a number of very well received on communicating this value to different regions in Italy: Lombardy from the region’ was launched in Express was launched to great Label sales have grown 8%, with promotional campaigns including consumers. (L’Alco), Apulia (Cannillo), Piedmont 2011. The products are clearly success during the year in Germany. profitability increasing 5%. Since ‘EUROSPAR Pay Less Than (Viale) and Sicily (Ergon and Gicap). labelled as being from Dutch origin. This new layout places a much 2010, turnover and profitability of The Rest’ and ‘SPAR Cheapest DeSPAR Italia launched a new L’Alco will be the first chain to This new range reflects Dutch greater emphasis on ‘Food to Go’ SPAR private label products have Prices Around’ benchmarking the organic, Fairtrade range called Scelta convert their stores to SPAR. consumers growing interest in and convenience. increased by 20%. supermarket chains. supporting local producers.

38 SPAR International Annual Report 2011 SPAR International Annual Report 2011 39 Western Europe

Portugal United Kingdom

Norway Spain Switzerland

continued their retail sales store openings planned for 2012. performed performed strongly this An energy efficient eco-store opened SPAR Norway SPAR Spain SPAR Switzerland SPAR UK pattern of growth this year, with continued to grow during the very well in 2011 with retail sales year, with retail sales growing by during the year, featuring LED sales of €1.4 billion, representing year with an increase of 2.8% to SPAR Spain launched a line figures of €455 million. 3.1% to reach €3.2 billion. lighting and energy saving doors an increase of 1.6%. €1.15 billion. This was an excellent of cosmetic products called fitted with electronic timers to save performance as the Spanish ‘Sensations’. The range was The first two SPAR Express stores The company focused on ensuring on unnecessary energy use. The new Seven new stores were opened economy continued to experience a launched with 22 products but it is were launched in Switzerland, which their range meets the needs of their store will use 30% less energy than this year, however due to a decline in consumer spending with expected to grow to 130 products both opened at AVIA petrol forecourts. customers whatever the eating a standard supermarket and will be major consolidation project of high levels of unemployment and in 2012. These stores offer fresh and healthy occasion; breakfast, lunch, food on the benchmark for future stores. underperforming outlets, the total loss in consumer confidence. convenience food. The store layout the go, or something for a family number of stores were reduced by This was developed in response is young and trendy and they meet meal. One of the key successes this S-Budget was launched this year as eighteen to 276. There was a focus on a programme to SPAR’s policy of continuously the needs of their customers year was in the cake category. part of a new value proposition to of store upgrades and consolidation adapting to its customer’s needs. through the offering of high quality reduce the cost of local shopping. The main focus throughout the throughout the year. In the This new range will be positioned fresh produce every day. SPAR UK Ltd is the official sponsor Thirty-three S-Budget lines were year was to increase sales share in Canary Islands, a supermarket against the best tertiary brands. of UK Athletics and has committed launched across the grocery, fresh areas such as Fruit and Vegetables, was converted to a EUROSPAR in SPAR Switzerland continue to focus to continue support until 2013, and frozen categories. The range experienced includes products sourced by SPAR fresh Baked Bread and Meat 20 days. By working closely with SPAR Portugal on their sustainability strategy. They ensuring a legacy for athletics beyond & Deli. A promotion and instore the retail design team at SPAR significant growth in 2011, achieving are achieving significant reductions 2012. Great benefits have been Austria plus lines developed sales program was developed to International, a modern store was retail sales of €44 million, in CO2 emissions through the gained through this sponsorship, specifically for the UK. give customers a more focused created catering to the residents representing an increase of 17%. development of intelligent distribution including Perimeter Boards discount offer. Fruit and Vegetable and tourists who shop there. logistics. This utilises computer assisted displaying SPAR branding at 6 UK There was a focus on promotional promotions are now held weekly The growth recorded is an software to ensure vehicles are Athletics televised events reaching activity in 2011 with the second with a 40% discount. One of the retailers in the Canary impressive performance as Portugal used to full capacity. Trucks are also over 6 million viewers and SPAR National Wine Festival. This was Islands continues to pioneer continued to experience the effects equipped with the latest generation adverts appearing in 6 Event guides. a great success as total sales SPAR actively support sports at a modern retail technology. In the last of the economic crisis throughout of engines which have seen a increased 1.86% during the local and national level in Norway, year, cash management systems the year, impacting all sectors of reduction of 5% in fuel consumption. The ‘Stores of the Future’ initiative promotion. SPAR brand wines were thereby developing close ties have been introduced in two stores the economy, including a marked was further developed throughout awarded Own-Label Range of the between the store and the local on a pilot basis. decrease in consumer spending Consideration for animal welfare is the year, with the opening of a Year at the Grocer Gold Awards. community. They sponsor Norway’s power. becoming increasingly important number of stores. SPAR Dalrymple largest women’s race, where over The new SPAR Partner in Spain, to SPAR customers. Meeting this opened its doors in August. The Leaflets were also distributed to 20,000 women from 32 Norwegian Miquel Alimentacó Group have There were a number of new store demand, EUROSPAR now offers store design responds to new local customers highlighting special cities participated this year. They confirmed plans to convert ten openings this year. There are now Swiss veal from animal friendly, consumer requirements in relation offers available instore. Promotional also sponsor the National Men’s existing supermarkets to the SPAR 58 SPAR stores in Portugal, a 30% CO2 neutral farming under the label to range, price positioning, layout sales during the year increased Handball Team. brand. There are also further new increase since 2010. ‘Swiss Premium Veal’. and space allocation. 23.9% compared to 2010.

40 SPAR International Annual Report 2011 SPAR International Annual Report 2011 41

Eastern Europe Slovenia & Poland Romania & Ukraine Hungary

Croatia Czech Republic Russia

experienced retail achieved €1.4 sustained its grew steadily retail sales SPAR Croatia SPAR Czech Republic SPAR Hungary SPAR Russia SPAR Slovenia SPAR Poland continued growth in 2011 with sales increased by 5.3% this year to billion turnover in 2011, a 2.2% strong performance through 2011, by 2.8% in the last year to €714 performed strongly in 2011 with retail sales reaching €263 million, €550 million. This was an excellent increase. This is an outstanding with a 21% increase in retail sales to million. This is a strong performance retail sales of €85 million. They representing an increase of 13% performance in the context of performance as the purchasing €935 million. This is a remarkable as the economic crisis continued continued to roll out an expansion since 2010. By the end of the the financial crisis which impacted power of consumers has achievement as the national growth to impact negatively on consumer plan with 33 new store openings, year SPAR operated a total of 15 negatively on many economies. considerably decreased over the was 4.3%. Total sales are soon spending. The number of stores which added a further 9,300m2 of hypermarkets and 4 supermarkets, past few years. With more than expected to exceed €1 billion. increased to 86, with retail selling retail selling space. The company will with a total retail sales area of over The company focused on 13,000 employees, SPAR is Store numbers also increased to space at 142,000m2. maintain its focus on store openings in 68,000m2. developing and launching new registered as the 5th largest 254, representing a 9% increase. 2012, with an additional 35 stores. private label ranges in 2011. One of employer in Hungary. The private label range enjoyed The fourth supermarket was the most successful launches was A major development for SPAR in significant growth during the year, saw significant SPAR Romania opened this year. This new store is ‘SPAR Fine Cuisine’, which is a The 20th anniversary of SPAR in Russia has been the recruitment of with an increase of 11% in food and change in the last year. While retail located in one of Croatia’s top selection of 20 Czech and Hungary was celebrated this year. 4 New Partners, three of which have non-food items. There are now 273 sales are unchanged at €10 million, holiday destinations. The average International cuisine products. To commemorate this, a number of now opened their first SPAR store. private label products on offer. underperforming stores have been hypermarket is 4,200m2 and the Another successful launch was the events were organised including a closed and the focus placed on average supermarket is 1,400m2. ‘SPAR Premium’ range, which has comprehensive marketing campaign All of the new Partners are The production in the SPAR bakery identifying and developing new 64 products with an emphasis on which attracted media exposure and successful regional retailers and increased 12.7% and now accounts locations in the Brasov Region. This year saw the launch of a Czech suppliers. a number of in-store events. have developed a leading position in for 46.6% of the baked goods on Ambitious plans have been put in new loyalty programme called their local market, but now see the offer in SPAR stores nationwide. This place, which will see the return to ‘Stickermania’, which has been There were a number of new There was a focus on improving value of the support offered by an year marked the 20th anniversary of growth of SPAR in 2012. especially welcomed by the younger marketing campaigns launched the quality of SPAR stores during International brand such as SPAR. SPAR in Slovenia. This important population. Another marketing during 2011. ‘Quality for the family’, the year, with a major programme It is planned to recruit additional jubilee was marked with customers continued to SPAR Ukraine campaign saw the successful focused on satisfying customers of store modernisations. 13 Kaiser SPAR Partners in Russia over the being offered numerous additional strengthen its position in the last introduction of ‘SPAR Premium’, with requirements for high quality, low supermarkets were transformed next few years. benefits and advantages. year, with retail sales increasing 41% Pierce Brosnan as the figurehead. cost products. A new fresh into SPAR stores with state-of-the- to €72 million. This is a significant Half of the 70 SPAR Premium campaign called ‘Fresh as it Gets’ art equipment, and 27 former Plus A major focus this year is the SPAR Slovenia remains one of the achievement as the economy was products are made in Croatia. was also launched in 2011. stores and 3 SPAR supermarkets development of their Private Label most reputable and trustworthy estimated to grow just 4% over the were modernised. offering for consumers. An ambitious companies in the country. A project same period. While the number of A digital and social media campaign During 2011, funding was received programme has been launched undertaken by AC Nielsen ranked stores remained at 32, investment was also rolled out through Facebook from the EU for staff training SPAR Hungary also extended to develop a comprehensive range SPAR first in the categories of was made in opening new stores. and a new online SPAR Newsletter, initiatives. These have been their private label offering, with the of locally and internationally freshness, quality, selection and which has been distributed to over developed in cooperation with the introduction of the luxury ‘SPAR sourced products. trustworthiness. 20,000 customers. Commercial and Tourist Association. Premium’ brand.

44 SPAR International Annual Report 2011 SPAR International Annual Report 2011 45 Africa Botswana & Malawi Mauritius & Mozambique Namibia & Nigeria

South Africa Zambia Zimbabwe

experienced of this initiative was seen in the again experienced recorded retail continued to SPAR South Africa SPAR Botswana SPAR Namibia SPAR Zambia SPAR Zimbabwe a challenging year with consumer commitment by young people trying performed well in 2011 with retail considerable growth in 2011, with sales of €52 million. There were four record significant growth during the spending still under pressure to make a difference and spreading sales now at €98 million. The retail sales increasing to €128 additional store openings during the year with retail sales increasing 20% in a highly competitive retail the message about the dangers of number of stores remained at 26 million, representing a gain of 15%. year, bringing the total number of to €233 million. A new store format environment. Despite the difficult climate change. with retail selling space increasing stores in Zambia to 11. was launched in Zimbabwe with trading conditions SPAR enjoyed to 23,250m2. There is an ongoing The large SUPERSPAR format two SPAR Express stores opening. a turnover increase of 9% to 47.2 The new ‘My SPAR’ marketing focus on the delivery of excellent accounts for the majority of SPAR The roll out of franchise stores in In addition to this an upgrade billion rand (€4.6 billion). campaign has helped the brand customer service. sales. Store numbers increased to Zambia has been successful. There programme is currently being rolled differentiate itself by celebrating 27 with retail selling space now up are now 5 franchise stores, with two out to improve store standards The number of stores increased the successful link that SPAR has opened its to 27,670m2. of these added this year. nationwide. SPAR Malawi marginally to 806, with retail selling made with the community. They first store during the year. The space also increasing to 875,000m2. are connecting with customers 1,690m2 store includes key fresh The second SPAR Challenge Road SPAR Zambia also launched the The company focused on the Throughout 2011, 5 Pharmacies emotionally which helps to strengthen food departments including bakery, Race run was held in Namibia first SPAR Express store in Foxdale. development of their Private Label @ SPAR were also opened. It is the bond with the community. butchery, fresh produce and during the year. Proceeds from the The store measures 829m2 and has products during the year. 25 of anticipated that this project will gain delicatessen. There is a plan in place race were paid to the Quinton Steel an estimated monthly turnover of the 64 private label products were momentum. The launch of the innovative ‘AWEH to open a further 10 supermarkets Botes Cancer Fund which helps €148,000. created this year. – Be the Best’ customer care and Express convenience stores. cancer patients in Namibia. The six SPAR distribution centres campaign has set SPAR stores There were also a number of store There was also a continued focus dispatched in excess of 181.6 apart from their competitors with recorded opened its second upgrades during the year, including on CSR activities. The Zimbabwe SPAR Mauritius SPAR Nigeria million cases, representing a 6.5% regards to exceptional levels of growth in retail sales of 6% in 2011 store this year. Figures show that the flagship store at SPAR Arcades. Rugby Sevens team participated in increase in volumes handled. customer service. to €22 million. The 8th store was there has been an increase in the International Rugby Board Volumes through SPAR facilities opened in Mauritius during the basket spend and customer count The Deli concept, ‘Golden Chicken’, Tournaments, thanks to sponsorship have increased in excess of 50% SPAR received an award for year, increasing retail selling space since 2010. was launched in the Soweto store from SPAR Zimbabwe. Also, in June over the last five years. store design in 2011 at the Retail to 7,000m2. They plan to increase this year. It was developed as a direct the annual SPAR Fun Run was held Design & Development Awards, market share in 2012 through new The company plan to expand their result of the knowledge gained from to raise funds and awareness for There was a continued focus on which honour the best of the developments and acquisitions of operations next year and work has the International SPAR Congress Childline Zimbabwe. Corporate Social Responsibility South African Retail Industry. The existing stores. already begun on two further SPAR and the Travelling Retail Seminar during the year. The second awards celebrate exceptional stores, which will open in early 2012. to London in September. The A new bio-degradable carrier bag Children’s Environmental Awareness creative distinction and excellence opened its first In addition, plans are underway to benefits of this new concept have was launched in 2011. The design Mozambique Conference was hosted by SPAR within the design and development store this year, with the support start building 3 further stores, which been consistency in quality, better used was created by the winner of a in Durban which was attended industry. The SPAR group is very of the SPAR South Africa Lowveld are expected to open in 2013. controls and affordable prices. nationwide school competition. by participants from a number of committed to consistently meeting Distribution Centre. African Countries. The importance these high standards.

46 SPAR International Annual Report 2011 SPAR International Annual Report 2011 47 Asia Pacific Australia & India Japan & UAE

China

again achieved The first HR conference was continued to SPAR China SPAR India exceptional growth in the last year, held in China in early 2012. The record considerable growth. Retail with retail sales increasing 77% to purpose of this was to put a focus sales increased by 45% this year to €716 million. The number of stores on developing international best €66 million. Store numbers also increased to 175 nationwide, with practice HR in China. The result of increased 50% to 10. The success 657,000m2 of retail sales space. this was the creation of five specific of the SPAR hypermarket in India Action Plans for each of the regions. can be seen in winning the award There was a focus on store for the ‘Most Admired Food & continued development during the year as 2 SPAR Australia Grocery Retailer of the Year’. new flagship stores were opened. to perform very strongly in 2011, It is anticipated that the new rural with retail sales of €172 million, experienced SPAR Japan store concept will be rolled out representing a 16% increase from an increase in retail sales in 2011 during 2012. 2010. This is a strong performance to €86 million. Store numbers when compared to the GDP growth saw a slight decline to 89. This is A new Food Safety initiative has of 1.8% for the year. Store numbers a satisfactory result as GDP over been developed. The purpose of remained at 100. the same period declined 0.5%, this project is to position SPAR as bringing the Japanese economy a leader in food safety in China. There was a programme of store back into recession, as a direct The first steps of this initiative have consolidations during the year, result of the devastating earthquake already begun with a link created some of the underperforming that struck in March 2011. between the China Chain Store & outlets were closed and new stores Franchise Association (CCFA) and were opened. The new stores offer opened the first SPAR UAE the Dutch government. quality fresh products and a tailored SPAR supermarket in Abu Dhabi grocery range. during the year. The store measures SPAR China has been recognised for 2,200m2 and offers a range of its highly innovative Online Training Corporate Social Responsibility 20,000 products. The key focus of Academy for retail employees remained a focus in 2011. SPAR the store is on freshness, quality, with a prestigious award from the Australia continues to help ‘The value and service. There will be CCFA. The online training allows Cancer Council’ to raise funds. further store openings next year, employees of individual stores to Money is raised by SPAR stores and the target is to have 9 stores register, develop and carry out their nationwide through events such as operational by the end of 2013. own personal training online. Daffodil Day and Pink Ribbon Day.

48 SPAR International Annual Report 2011 SPAR International Annual Report 2011 49 SPAR Partners Worldwide

Australia India Poland South Africa SPAR Australia Limited MAX Hypermarket India Pvt. Ltd. SPAR Polska Sp. z.o.o. The SPAR Group Ltd.

Austria Ireland Portugal Switzerland SPAR Österreichische Warenhandels AG SPAR Ireland (part of BWG Foods) SPAR Portugal S.A. SPAR Handels AG (Schweiz)

Belgium Italy Romania Ukraine SPAR Retail NV (part of Colruyt) DESPAR Italia Consorzio a r.l. SPAR Brasov SPAR-Ukraine SPAR Lambrechts NV SPAR Regional Companies: SPAR Regional Companies: Aligrup S.p.A. Russia Botswana SPAR Russia SPAR Dnipropetrovsk SPAR Botswana Aspiag Service S.r.l. SPAR Kharkiv C.A.D.L.A. S.p.A. The SPAR Group Limited, South Africa SPAR Regional Companies: SPAR Luhansk DESA - CS&D scpa SPAR Chelyabinsk FIORINO S.r.l. SPAR Krasnoyarsk China G.A.M. S.p.A. United Arab Emirates SPAR China SPAR Middle Volga SPAR UAE Gruppo 6 G.D.O. S.r.l. SPAR Povolzhye GRUPPO TUO S.p.A. SPAR Regional Companies: SPAR Retail Moscow IPA SUD S.r.l. SPAR Shandong SPAR St. Petersburg United Kingdom L’ALCO S.p.A. SPAR UK Ltd. SPAR Guangdong SPAR Tula SADAS S.p.A. SPAR Hunan (and Guizhou) SPAR Tyumen SPAR Regional Companies: SPAR Shanxi (and Inner Mongolia) SPAR Vostok Appleby Westward Group Plc

SPAR Beijing Japan A.F. Blakemore & Sons Ltd. Hokkaido SPAR Co., Ltd. Slovenia James Hall & Co. (Southport) Ltd. Croatia SPAR Slovenija d.o.o (part of ASPIAG) Henderson Wholesale Ltd. SPAR Hrvatska d.o.o. (part of ASPIAG) Malawi C.J. Lang & Son Ltd. SPAR Malawi Spain

Czech Republic SPAR Española, S.L. Zambia SPAR √eská obchodní spole≠nost s.r.o. (part of ASPIAG) Mauritius SPAR Mauritius SPAR Zambia Ltd. SPAR ıumava s.r.o. SPAR Regional Companies:

Agrucan, S.L. Mozambique Cencosu, S.L. Zimbabwe Denmark SPAR Mozambique SPAR Zimbabwe Ltd. Domingo Marqués, S.A. SPAR Danmark A/S (part of Dagrofa A/S) The SPAR Group Limited, South Africa Excluib, S.A. SPAR Regional Companies: Fragadis, S.L. France SPAR Eastern Region Namibia Grupo Upper Sociedad Cooperativa SPAR France SAS (part of Groupe Casino) SPAR Namibia SPAR Western Region Insular General Alimentaria, S.A. The SPAR Group Limited, South Africa José Padilla Francés, S.L. Germany Líder Aliment, S.A. SPAR Handelsgesellschaft mbh Netherlands Miquel Alimentacó Grup, S.A.U. SPAR Holding B.V. Romen, S.L.

Greece Supermercados Marcial, S.L. Veropoulos Bros S.A. Nigeria Tomás Barreto, S.A. SPAR Nigeria Victoriano Moldes Ruibal, S.A.

Hungary SPAR Magyarország Kereskedelmi Kft. (part of ASPIAG) Norway SPAR Norway (part of NorgesGruppen ASA)

50 SPAR International Annual Report 2011 SPAR International Annual Report 2011 51 Action Groups Statistics 2011

The Action Groups provide a unique platform for Country Retail Sales Retail Store Retail Sales Average Store working together and exchanging knowledge. 000’s Numbers Area (m2) Size (m2)

Austria 5,360,000 1,470 1,067,681 726 South Africa 4,628,469 806 874,810 1,085 Marketing Action Group Italy 3,855,662 1,549 831,423 537 Chairman: Tobias Wasmuht SPAR International: Gary Harris, Hanna Schober, Niels Dekkers, Penny van der Kaars United Kingdom 3,189,273 2,504 357,860 143 Norway 1,440,539 276 156,351 566 Gerhard Fritsch A Jesús González ESP Marielle Witjes NL Hungary 1,400,000 389 391,467 1,006 Manu Suffeleers B Stratis Batagias GRE Andreas Gjosund NOR Spain 1,152,174 904 327,075 362 Wolfgang Frick CH Suzanne Weldon IRL Adam Margolin UK Ireland 1,116,144 422 116,720 277 Linda McBeth DK Marco Orsenigo ITA Denmark 1,072,740 504 170,309 338 France 968,382 956 245,214 257 Russia 935,000 254 126,453 498 Belgium 813,500 291 137,743 473 Human Resources Action Group China 716,000 175 657,000 3,754 Chairman: Frank O’Donoghue SPAR International: Jutta Klassen, David Moore Slovenia 713,546 86 142,133 1,653 Greece 683,389 189 142,658 755 Raimund Lainer A Helene Renton Eidsvig NO Sam Davidson UK Czech Republic 550,000 39 138,293 3,546 Allan Nielsen DK Netherlands 491,455 282 111,309 395 Switzerland 455,094 164 69,838 426 Croatia 263,426 19 68,036 3,581 Germany 250,000 340 27,200 80 Warehouse Action Group Zimbabwe 233,009 64 40,826 638 Australia 172,008 100 36,271 363 Chairman: Frank O’Donoghue SPAR International: Dieter Dornauer Namibia 127,706 27 27,670 1,025 Per Tellef Arning NO Trevor Currie SA Dominic Hall UK Botswana 97,506 26 23,249 894 Haibin Tang CN Anthony Barton UK Pat McGarry UK Japan 86,224 89 9,559 107 Poland 84,903 71 18,288 258 Ukraine 71,817 32 23,745 742 India 65,505 10 47,103 4,710 BIGS Action Group Zambia 52,139 11 19,142 1,740 Portugal 44,132 58 20,013 345 Chairman: Gordon Campbell BIGS: Michel Laurant, Natasha Crabtree Nigeria 22,167 2 5,414 2,707 Mauritius 22,041 8 7,000 875 Robert Schaumburger A Jacob Heinz DK Simone Pambianco ITA Romania 10,000 7 3,000 429 Johannes Holzleitner Aspiag Menelaos Roufis GRE Jan-Hein van Spaandonk NL Malawi* Luc Lauwers B Simon Marriott IRL Mark Keeley UK U.A.E.* Bernhard Schwendinger CH Mozambique*

Total 31,143,961 12,124 6,440,853 531

STOREIT Action Group

Chairman: Frank O’Donoghue * Malawi, UAE and Mozambique all opened their first SPAR store in 2011. Their first full trading year will be 2012. Hannes Leobacher A Enno Stelma SA Joanne Kelly UK Preben Gaardsøe DK Roy Ford UK Martin Rushton UK

52 SPAR International Annual Report 2011 SPAR International Annual Report 2011 53 SPAR International Rokin 99 -101, NL-1012 KM Amsterdam Tel: +31 (0)20 626 6749 Fax: +31 (0)20 627 5196 www.spar-international.com