boss John Roberts is preparing to ramp up the etailer’s European expansion after targeting a move into the Netherlands or Austria. aims to open in Austria

Although the latter nation shares a border with continental retail heavyweight Germany, where is already present, Austria remains a market largely unknown to British retailers. Retail Week examines what expansion opportunities the market could hold.  

The Austrian retail market

  • According to the most recent Planet Retail data, Austria had 8.52 million inhabitants at the end of 2014.
  • The country’s GDP was €328.87bn (£233.25bn), with nominal growth at 1.9%. GDP per capita stood at €38,600 - ahea dof many other European countries.
  • Total consumer spend in Austria last year was €175.55bn (£124.51bn). Of that, €12.04bn (£8.54bn) went on entertainment, electronics and office supplies.
  • It recorded consumer price inflation last year of 1.46%.  
  • Margins are “much higher” in Austria than in Germany, particularly in the grocery sector, according to Planet Retail analyst Denise Klug. She told Retail Week: “Several German retailers use Austria as a test market, giving them the possibility to experiment with new concepts and ideas. In Germany everything is all about efficiency.”

Big retail players

  • The biggest retailer in Austria is Rewe Group. It operates more than 1,000 grocery stores under the Billa fascia, as well as the discount chain Penny Market. Rewe generated €7.92bn (£5.62bn) of sales in Austria in 2014.
  • Spar is the country’s second largest retailer with more than 1,600 stores. Grocery rival Aldi runs around 450 stores under the Hofer banner, while fellow discounter Lidl has around 200 stores in Austria.
  • Members of buying group Euronics collectively represent the biggest electricals retailer that would be competing with. There are 232 Austrian Euronics stores, which recorded sales of €859.9m (£609.89m) last year.
  • In other non-food categories, Austria’s biggest retailers include H&M, Ikea and C&A.
  • Klug says: “There are not so many UK players around in Austria and Western Europe in general, particularly in the grocery segment. The only specific UK players I can think of that are available here and doing well is Asos. The market in general is in local hands.”

Opportunities and challenges

Klug believes that being an online retailer in the country has pros and cons. She says: “In the consumer electronics segment, most retailers have physical stores and not much of an online presence.

“Ecommerce is still in its infancy in Austria, so I think there is potential for retailers that are leveraging the possibilities of an ecommerce operation there.

“The people are still very traditional when it comes to buying things like dishwashers and washing machines, but with the shift to goods online and the importance of Amazon, people are becoming more open to buying products online.”

On’s chances of success in Austria, Klug says: “I would say there is a gap there that would be filling, but it’s a category where shoppers want to see and touch the product, so they may take some convincing to move online.

“It would also be very dependent on brands. In the categories would be selling, brands really play an important role in Austria.

“I don’t know about the assortment they would offer, but they would have to adapt to local needs and provide brands the Austrian shoppers know and want. It’s based on trust in that segment because prices per item are high.”