Penny Romania, owned by the German group REWE, will invest over RON5.1bn (more than €1bn) in Romania by 2029, mainly in expansion, the company said in a press release.
The company outlined its investment plans for the rest of the decade after achieving a 19% y/y hike in turnover to RON4.73bn in 2020, while profit soared by 54% y/y to RON85mn. Penny attributed this to changes in the behaviour of Romanian consumers caused by the coronavirus (COVID-19) pandemic, which “motivated them to move to quality products at the right prices”.
The retailer plans to reach a network of 619 stores, from 276 at the end of 2020, and six logistics centres, in the next eight years. This year, the company aims to open 25 stores in the country and build a fourth warehouse. It will also remodel remodel 100 stores in 2021 and its entire network of stores by 2022.
Last year, the retailer invested RON371mn in the modernisation and expansion of the local store network. It opened 20 new stores in 2020, ending the year with a total of 276 units. Among the changes in its new format stores are a large area for fresh products, brands chosen to appeal to Romanian tastes and more visible signage of promotions and the main food categories.
The changes took place in a “difficult environment”, the company said. “Last year was a real test for us. In the face of new challenges, we had to adapt quickly, be flexible, but also firm in our decisions and, above all, prioritise the safety and health of our employees and customers,” said Daniel Gross, CEO of Penny Romania.
As in other markets, Romania’s food retail sales spiked in March as people stockpiled in anticipation of the first lockdown. Not only Penny, but other Romanian supermarket chains also expanded during 2020. Since then, food sales have stabilised. The latest data from the statistics office, INS, show that in the first quarter of this year food sales stabilised around the level seen at the end of 2019-early 2020, just before the crisis.
Penny entered the Romanian market in 2005 with a procurement policy focused on regional producers and collaborations with local producers, including long-term partnerships. In the next three years, for 60% of its product range the main ingredient will be manufactured and processed in Romania.
The Romanian chain of 283 stores is served by three logistics centres in Stefanestii de Jos, Turda and Bacau. It has over 5,300 employees.