In 2011, the grocery retail sector reached $282 billion in sales.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
GAIN Report Number: FR9116
Laurent J. Journo
In 2011, the grocery retail sector reached $282 billion in sales. Five major players controlled 60 percent
of the overall value sales, and are investing in small format stores. Consumers are paying attention to
obtaining good, quality food products for lower prices, and have been willing to purchase private label
products rather than brand name ones, as long as the quality is comparable.
Average exchange rate for calendar year 2011:
USD 1 = 0.72 Euros
Source: International Monetary Fund
SECTION I. MARKET OVERVIEW
In 2011, the major grocery retailers continued to invest in small format stores, such as supermarkets and
convenience stores. Auchan started operating with a convenience store format with its new A2pas
outlets, while Carrefour invested in new Carrefour City and Carrefour Express outlets. This trend was
largely due to changes in the way consumers shopped for grocery products: Most perceived this task as
boring and prefer not to waste more time than necessary shopping; and furthermore, in urban areas there
were a large number of one or two person households, which resulted in smaller baskets of grocery
purchases. As a consequence, a growing number of consumers avoided large grocery retailer formats
(hypermarkets) and opted to shop in smaller formats near their home.
In 2011, hypermarkets accounted for 42 percent of the overall sales value of grocery retailers. Despite
having the lowest number of outlets, they remained the largest retailers in value terms. Hypermarkets
can offer large range of grocery and non-grocery products as well as a wide range of prices, this is the
reason families choose this type of retailers.
Supermarkets and discounters registered 3 percent in value sales growth in 2011. The expansion of
discounters encouraged hypermarkets and supermarkets to develop their own private label range to
become more price competitive and this attracted greater numbers of price sensitive consumers to their
Neighborhood/convenience stores declined in value sales in 2011. This was mainly due to a price
positioning that was higher than other grocery retailing formats, particularly where consumers continued
to be very worry in their spending. Specialized food stores such as organic stores, benefitted from the
growing receptiveness to natural and healthy products and registered a 4 percent value sales increase.
The E-commerce has progressively increased over the years and is likely to continue, as major retailers
have invested in their own websites.
SECTION II. MARKET ENTRY
More than ever, consumers are paying attention to obtaining good, quality food products for lower
prices. They are also appreciating discounts and lower prices and have been willing to buy private label
products rather than brand name products. Private label products are becoming better established in
grocery retailers; therefore, U.S. companies interested in penetrating the French market should consider
doing so. Price, proximity, and convenience are among the major needs of French consumers, making
convenience stores quite popular.
SECTION III. COMPETITION
About 30 players with retail chains operate in the sector accounting for 80 percent of overall value
sales. The top five are Carrefour, ITM Enterprises, E. Leclerc, Auchan, and Casino representing 60
percent of the total market’s value sales. The leading players are present in different categories and own
different outlets. Carrefour is present in all types of modern formats and ITM Enterprises operates in
hypermarkets, supermarkets, and discounters. In terms of positioning, differences exist: For example,
Carrefour has several outlets and offers numerous services; its stores are relatively higher price
positioned in comparison with other competitors such as E. Leclerc. ITM Enterprises focuses on
accessible prices and has a larger presence in semi-rural parts of France. Auchan has hypermarkets
located in commercial centers that are surrounded by stores of non-grocery retailers such as Leroy
Merlin, Boulanger, and Kiabi.
SECTION IV. BEST PRODUCT PROSPECT
Major grocery retailers are investing in small format stores in order to adapt to consumers.
Hypermarkets are expected to be the most valuable category in grocery retail. The marginal economic
recovery should encourage discounters to expand their outlet network to target the lower purchasing
power consumers. Discounter’s performance would likely be inhibited by the development of private
labels in hyper/supermarkets.
Independent small grocery retailers will continue to have difficulties competing with cheaper
supermarkets. Despite the closing of some outlets, these independent small grocers will continue to be
appreciated for the advantages they offer such, as personal contact. In addition, grocery retailers are
expected to see further competition from the internet retailing until 2016, thereby inhibiting stronger
performances of this market as a whole.
Consumers are developing appetites for ethnic foods, theme restaurants in France that serve
international cuisines have increased popularity for international foods, thus creating demand for high-
quality products. Most ethnic foods are sold in supermarkets. The Monoprix supermarket chain
pioneered the introduction of ethnic products and other major chains followed notably Carrefour and
For product opportunities and additional information on the Retail Sector, including entry strategy,
please visit FAS/Paris website and reports; particularly the Retail Food Sector and the FAIRS Reports.
SECTION V. KEY CONTACTS AND FURTHER INFORMATION
Internet Home Pages
Internet home pages of potential interest to U.S. food and beverage exporters are listed below:
USDA/ Foreign Agricultural Service http://www.fas.usda.gov
U.S. Mission to the European Union http://useu.usmission.gov/agri/usda/html
European Importer Directory http://www.american-foods.org
Website for Professional Trade Shows
and Events http://www.salons-online.com
Questions/Comments and Assistance
If you have any questions or comments regarding this report, need assistance exporting to France or
desire French buyers contact lists, please get in touch with the U.S. Agricultural Affairs Office in Paris
Foreign Agricultural Service
U.S. Department of Agriculture
Embassy of the United States of America
2, avenue Gabriel
75382 Paris Cedex 08, France
Phone : (33-1) 43 12 2245
Fax : (331) 43 12 2662
Email : firstname.lastname@example.org
Home page : http://www.usda-France.fr