"Retail chain Spar has inaugurated its second logistics centre in Hungary. The new facility sprawls on 47,000 square metres. Spar has embarked on a massive expansion campaign five years ago and the building of the new logistics centre was necessitated by the takeover of the local Plus discount retailer chain that increased warehousing demands.The new base in Üllő will have an initial staff of 300 and in a few months it will give job to 600 people, index.hu has reported on Tuesday.
The European commission green-lighted the takeover of Plus Élelmiszer Diszkont Kft. by Spar on 25 June.
“The Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it," the EC said in a statement.
Spar needed a nod from Brussels, as the annual turnover of its parent company, Spar Austria - a group that controls subsidiaries in Austria, Croatia, the Czech Republic, Hungary, Italy and Slovenia - is over the approval threshold.
Gross revenues of the Hungarian 205-member Spar chain totalled HUF 284.5 billion, while the 174 units of Plus reached about HUF 100 bn in 2007. The Spar-Plus network has 380 units at present.
Plus warehouse slated for closure
Spar started construction works in Üllõ on a 140,000-sqm plot between the M0 ringroad and the M4 motorway a year ago, with the aim of making the new facility a hub for distribution to Eastern Hungary. The logistics centre will be used as a base for vegetable, fruit and packaged poultry products distribution to every store in the Spar network. This will take off burden of the merely 35,000-sqm Bicske warehouse. Péter Feiner, CEO of the Spar-Plus network said the nearly 20,000-sqm warehouse of Plus at Budapest's Jászberényi road would be closed shortly.
Spar has taken over 2,300 Plus employees as of 1 July, and its headcount will be boosted to 15,000 by the end of the year, as the company has ten new supermarket openings in the pipeline.
There will be staff increases at Plus stores, as well, given that the number of employees in a Plus unit is only about a third of an average Spar supermarket.
The company will also refurbish Plus stores gradually in the next two to three years. Thirty of these will be reconstructed to meet Spar standards, while the rest will be self-service supermarkets.
As the larger network's demand for carcass meat and meat products will growth considerably, the meat unit in the Bicske centre, which processes 220,000 hogs and produces 5,000 tonnes of meat products annually, with a staff of 100, will also need to be expanded. The larger-capacity plant is expected to be up and running by early 2010.
The volume of orders for Spar's suppliers will be up by about HUF 50 bn a year, thanks to the acquisition of Plus.
Spar buying up the whole market
Spar had previously bought the 20 stores of Billa, which has since then withdrawn from Hungary. In 2003, it purchased 22 Kaiser's stores from Tengelmann. While they had planned to run the latter units under the Spar brand name from 2009, as the original contract expires at the end of this year, Spar has sealed a new deal, under which it will use the Kaiser's brand name for another five years.
While an average Spar supermarket offers about 6,000 kinds of goods on 900 sqm, the offer of a Kaiser's store is 10,000 kinds of products on 1,500 sqm."
Source: Portfolio Online Financial Journal
27.08.2008