In full expansion, Mercadona and the white brands have found an unexpected rival: the regional “supers”

There’s not much room for doubt here. Mercadona’s presence on the Spanish supermarket map is huge and continues to grow. Its market share exceeds 25%, which gives it a great advantage over the best positioned competitors in the sector, such as Carrefour, Lidl, Eroski or Dia. Neither of these means that Juan Roig is the only chain that has managed to strengthen its position throughout 2024, after turbulent years marked by the pandemic and rising prices.

There is a group that resists and also increases its weight until it captures a significant part of the pie: supers regional. And this is not a coincidence.

What do the numbers say? Overall, regional supermarket chains are stronger today than they were a year ago. This is reflected in at least one recent report from market research company Kantar. According to their calculations, in August this type of business, which includes Consum, Bon Preu or Gadis, had already reached a value share of 17.7%, an increase of six tenths.

More and more present. “They are consolidating as an increasingly common alternative, as evidenced by the fact that networks of this type produce 5% more baskets compared to last year,” comments Bernardo Rodilla from Kantar. At the territorial level, the report shows growth “in all regions of the country”, although it particularly highlights the evolution recorded in the Canary Islands (+1.3%), Andalusia and the north-west (+0.9%) or the Levant, where confirmed an increase of 0.7%.

Are there any other indicators? Yes, indicative, about commercial space. Retail trade data released a month ago by Asedas, the Spanish Association of Distributors, Supermarkets and Supermarkets, shows that the 25 main regional chains have grown significantly since 2020. This is despite the challenges that have marked the past four years, including a pandemic and an inflation crisis exacerbated by the war in Ukraine.

More specifically, the report shows that the retail footprint of major regional brands grew by more than 10%, double the sector average, which grew by 5.4% over the same period. Asedas’ results also show that there are heavyweights among regional chains, with the top ten operators controlling 23% of outlets and 15.5% of space. If we expand our focus to the 25 largest operators in the “regional leaders” group, their share among stores will grow to almost 38%.

What brands are we talking about? The list prepared by Asedas is topped by Coviran, Gadisa Retail, Condis, AhorraMas, Bon Preu, HD Covalco, Uvesco, Froiz, Dinosol and Alimerka, some of which are leaders in their fields. For example, Gadisa stands out in Galicia, Dinosol and Alimerka have fundamental weight in the Canary Islands and Asturias respectively, and if we talk about Cantabria, Semark Lupa is an excellent example.

However, the most relevant example in this sector is that of Mercadona, a Valencian firm that began operations 25 years ago as a regional chain but is now among the large individual operators in Spain, with more than 1,600 supermarkets scattered throughout much of the region. countries and a decisive weight in the national market. Asedas estimates it accounts for 16.7% of the total commercial area.

White label weight. For Aseda CEO Ignacio García Magarzo, the weight of regional networks in Spain is interesting for several reasons. Firstly, because it distinguishes the country from other European countries. Secondly, because, in his opinion, it represents a “great advantage” for consumers when choosing between options. “Spain is a very diverse country and the ability to adapt to the local consumer is key to the distribution business model.” The strength of regional chains is also evident on another front: the private label front.

After increasing market share in recent years, coinciding with the inflation crisis and the apparent commitment of some chains such as Mercadona, Lidl or Aldi, the expansion of private labels appears to have slowed. At least that’s what Kantar WorldPanel’s figures show, which show that while from 2022 to 2023 its share increased by two points, then from 2023 to 2024 the increase was already 1.3%.

And while there are several key reasons explaining this trend, one of them is the strengthening of regional supermarket chains, where the brands of large manufacturers are in a better situation.

“It’s more moderate”. “Distribution brand growth has now normalized and moderated,” Rodilla said in a statement to Spanish. In September, Kantar pointed to a market share of private labels exceeding 44%, although other sources indicate that their weight in total sales by value is higher and will already reach 48.5%. If we look at food products only, the footprint of these distribution brands is even higher at 49.5%.

It’s not that regional chains haven’t increased the weight of private labels on their shelves, but they don’t reach the importance they have at other chains. “If the trend towards super-regional stores continues, we can expect a consolidation of some of the slowdown in private label growth,” the sector acknowledges. Diary Five days There is a fact that helps to understand this: one out of every four euros that consumers spend on manufacturer brands is registered in regional brand stores, making them a refuge from private labels.

“From the nearest store to the local supermarket”. That regional supermarket chains have gained a foothold in the sector comes as no surprise to Kantar, which sees it as a “natural step” as small businesses make way for a new model. “From the nearest store to the local supermarket.”

“They grew up under any circumstances. They are strong in proximity and fresh, which gives them the best opportunity to benefit from transfers from local shops,” Rodilla explains in Five days. It is this strength that would allow it to reach a share of 18% and become, together as a group, independent of the various brands, the main competitor of the giant Mercadona.

But… Where does this growth come from? Due to a combination of factors, although Rodilla was already one of the most important. Consum, Gadisa, Froiz, BM, Bon Preu, Bon Area, AhorraMas, El Jamón… stand out for their “commitment to proximity and to the brand of the manufacturer,” says Kantar. However, there is another key that is equally or even more relevant: in some sense, they are able to attract customers who no longer turn to the “specialty channel” to make a purchase. In other words, they benefit from consumers switching from fish or meat shops.

“This growth is based on two differentiating factors: the proximity of these chains to the buyer, which allows them to profit from transfers originating from specialized stores, and greater protection of the manufacturer’s brand,” comments the Kantar expert. Spanish newspaper.

Transfer effect. People are increasingly gathering super To buy fresh produce, regional chains are offering the added bonus of proximity and offerings more similar to what they could previously find in their neighborhood stores.

“They are betting on proximity, and this, together with good positioning in the field of perishable fresh products, also works, there is a transition from specialty stores, from convenience stores to supermarkets,” the Business Insider expert reflects. And not only that. Chains such as BM, Gadis or El Jamón have entered new markets.

Images | Gadis, AhorraMas, Koviran and Alimerka

In Hatak | Brands have compiled a rating of supermarkets that are least interested in their new products. They give Mercadona 0%