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Spar Seeks New Greek Partnership

Netherlands-based retail association Spar International is looking to re-establish its brand in Greece, following the decision by its local partner Veropoulos to sell the business last year. Spar International confirmed to LZ Retailytics it is in "advanced negotiations with a number of suitable partners in Greece". 

Spar International is continually examining opportunities to expand its brand presence around the world. Spar currently works with over 70 Partners in 46 countries, and had an almost continuous presence in Greece since 1969.

Opinion

Looking to Reclaim its Throne

While waiting for an official announcement from Spar International, we contemplate the different options offered for regaining its place in the Greek retail landscape. As much as it previously relied on one single partner, we believe this scenario to be unlikely. First, the market has been in turmoil in recent years leading to collapses and consolidation. The top players are all centred on their core, eponymous formats and are unlikely to relinquish their brand for a franchise. The exception is Metro AEBE which enjoys a strong cash & carry presence. However, this is the very same retailer at the root of Spar's disarray, as it ended the Spar franchise agreement in the wake of its acquisition of the local network.    

Consequently, Spar is likely to look further down its list. The ideal scenario for Spar to quickly regain scale would be to step into the densely populated areas of Athens and Thessaloniki (northern Greece). Here the pool of medium-sized partners is shrinking following years of severe economic downturn, resulting in many gathering within retail cooperatives to patriotically emphasise their Greek roots. Naturally, the challenge for foreign Spar is to poach members by showcasing the benefits of its (currently non existent) local network. For a time, rumours circulated around Veroukas Group (100 supermarkets network located in Athens, Thessaloniki, Crete and other locations) or Galaxias supermarkets (150 stores and a dozen of cash & carries) before being refuted. 

As the months fly by, we believe the most likely scenario for Spar is now to rally multiple smaller players to ensure sufficient volumes. The bankruptcy of the major franchisor Carrefour Marinopoulos has left smaller networks considering their options. For these, Spar provides the advantage of an international brand known to Greeks and tourists alike, while preserving relative independence.

As much as recruiting may be more tedious than intially anticipated, Greece remains key to any ambition in the region, particularly as Spar is establishing a foothold in the neighbouring countries of Albania and soon, Cyprus. Meanwhile, we will need to wait to hear the final list of Greek contestants.