Eroski co-operative hopeful despite falling sales

Spanish co-operative supermarket chain Eroski has announced its results for 2015, showing a fall in sales but with signs for encouragement.

Net sales fell 0.99% in 2015 to €5.28bn (£4.12bn) although operating profit rose 14.7% to €104.7bn (£83bn). Where stores had been remodelled, sales increased by 7%.

IGD noted that Eroski would not focus on increasing the number of stores. Instead, according to Eroski president Agustin Markaide, the beginning of a recovery from economic downturn would be a chance for retailers to enhance their food offerings. Fresh food is the focus, and the retailer has increased its fresh offerings by 25% in hypermarkets and 40% in supermarkets.

In line with the UK grocery retail market, Eroski and its franchises will also concentrate on smaller, convenience stores.

The retailer is expanding online and has recently added a 25th collection point for goods bought on the internet. Online shopper numbers have risen 20% over the last two years.

The IGD analysis also showed that Eroski would continue to focus on its ‘Club’ loyalty scheme, where members receive special discounts, prices and offers. The number of members of the Club scheme hit three million recently.

Case studies: Retail co-ops in Europe

Eroski is a worker-consumer hybrid co-operative within the Mondragon Corporation – a large federation of worker co-ops in the Basque region of Spain. As well as its own-brand supermarkets, it has 553 franchised outlets, and employs more than 50,000 people. Around 50% of products in Eroski stores come from local producers and the retailer allocates 10% of profits to the community through Foundation Eroski. It has made commitments to reduce food waste across its stores and to promote health food to customers.

As a co-operative, workers and consumers are both involved in the management of the company and are full members of the board of directors.