Spar remains unchallenged: sales boom and market shares increase!

Spar remains unchallenged: sales boom and market shares increase!

The grocer Spar presented its annual figures for 2024 today and, with sales of 10.4 billion euros, recorded growth of 5.1 percent compared to the previous year. The Spar Group, which operates over 3,000 stores in Austria and six neighboring countries as well as 31 shopping centers and 227 Hervis branches, has been able to defend its market leadership in the Austrian food retail sector. With a market share of 36.9 percent, the gap to its main competitor Rewe, which now stands at 33.6 percent, has been further expanded. These developments were made by Leadersnet published.

Spar's strategy is clear: the focus is on a high proportion of freshness, regionality and a mixed range of brands and own brands. The private label share in the food sector has risen to 45 percent, which underlines the doubling over the last 20 years. The own brands “S-Budget” and “Spar Premium” in particular show strong sales increases of 8.5 percent and 11 percent, while the vegan products “Spar Veggie” also shine with an increase of 13 percent The press reported.

Investments and expansion

Spar is planning an investment package of 900 million euros for 2025, of which over 400 million euros will flow in Austria. Around 60 new, modernized or expanded stores are planned in the country, especially in Vienna, where there are still opportunities for expansion. These371 action plans aim to further strengthen market presence and increase customer satisfaction. Spar retailers, which offer personal responsibility and entrepreneurial activity, have performed better compared to chain stores.

However, Spar also faces challenges. The loss of the Hervis subsidiary chain, whose sales fell from 510 million euros to 490 million euros and whose losses doubled to almost 64 million euros in 2023, is putting a strain on the balance sheet. 13 Hervis branches were closed last year. There are also conflicts in price negotiations, for example with the Lower Austrian dairy NÖM, and Spar is defending itself against a Hungarian special tax, which cost around 75 million euros in 2023.

Market analysis and future outlook

The analysis of the Austrian food retail sector shows that three large retail groups, namely Spar, Rewe and Hofer, cover over 85 percent of the market. Even if discounters like Lidl are gaining market share, Spar remains the clear market leader. These market developments and increasing competition are forcing all players to develop innovative approaches to improve customer loyalty. Supermarket blog points out that food prices rose sharply in 2022 and 2023, but inflation is expected to be only 2.1 percent in 2024.

In summary, it can be said that Spar was able to continue its successful path. The focus on own brands, customer proximity and extensive investments in infrastructure could also prove advantageous in the future. However, the challenges that the market brings with it will have to be continually kept in mind in order to secure the market position in the long term.