The deteriorating state of the Greek economy is exerting a huge impact on the country’s grocery retail scene with international players seeing mixed fortunes.

The deteriorating state of the Greek economy is exerting a huge impact on the country’s grocery retail scene with international players seeing mixed fortunes.

Grocery spending per capita of E2,530 (£2,230) in 2011 is below the 2008 level, and shopping behaviour has changed significantly, as households abandon hypermarkets to reduce travel costs. Consumers are also having to stop buying household essentials in bulk and are instead spend small amounts in more frequent local trips, favouring smaller-format supermarkets, discount and convenience stores.

Carrefour, the leading hypermarket operator in Greece with more than 30 stores, seems to have been hurt most by this shift. It has been stretching payment terms with several suppliers, some of whom have simply walked away, resulting in embarrassing out-of-stocks. Carrefour Greece’s most recent results underscore the retailer’s problems in the country, with sales declining by 7.5% to E625m (£541m) year-on-year in the first quarter, and like-for-like sales down by a record 8.1%.

Carrefour bosses finally ran out of patience and the Greek senior management team were given their marching orders last month.

In contrast, Belgian grocer Delhaize’s business in Greece is flourishing. Net revenues rose by 6.3% in the last full year, compared with the 7.6% dip at Carrefour. Delhaize has been expanding throughout the country by opening small-store formats, making selective acquisition of local chains (Plus Hellas and Korifi) and buying stores from bankrupt local players. Its well-developed private label product range is proving a hit with shoppers: sales grew from 10% in 2009 to 17% in the third quarter of 2010.

Another fast-expanding retailer is Schwarz Group’s Lidl, the only significant player on the Greek discount scene after Aldi’s withdrawal and the conversion of Carrefour’s Dia stores to supermarket and convenience store formats. After a lull, Lidl opened some 15 stores last year, 12 of which were former Aldi stores.

Carrefour, meanwhile, will pin its hopes for the future on its Carrefour Planet concept, the first of which is due to open next month. A second, in Thessaloniki, will be converted later in the year. The improved private-label range at Carrefour Planet stores is likely to have some success. But it seems improbable that the enhanced and premium non-food and service offerings will chime with the current mood of the Greek shopper.