RN Spar Ireland

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International SPAR Congress

International SPAR Congress

Pictured are (l-r): Leo Crawford, President, SPAR International, Dr Gordon Campbell, Managing Director, SPAR International; and Willie O’Byrne, MD of SPAR Ireland.

talk about where our failures have been so we don’t make those mistakes again.”

SPAR Celebrates in Killarney The 58th International SPAR Congress took place in Killarney in May, as SPAR Ireland celebrated 50 years of SPAR in Ireland.

SPAR Ireland celebrated the 50th anniversary since the first SPAR store opened in Ireland by hosting the 58th International SPAR Congress in May. Following a number of store visits around Dublin, delegates were transported to the Europe Hotel, overlooking the lakes of Killarney for two days of presentations and discussions.

Opening the Congress, Leo Crawford, President, SPAR International, welcomed delegates to Killarney.

“Despite the fact that we’ve had the worst recession in living memory in Ireland, I think you can see that SPAR Ireland is working very hard to innovate and protect our

business,” he revealed. Describing SPAR Ireland as a great example of how SPAR International works, he described how the partnership with SPAR International has helped SPAR Ireland to develop a “competitive advantage”.

“What is happening in Ireland represents the ethos of what SPAR International is all about,” he said. “We have been able to use the expertise from other countries, from SPAR International and in particular, our use of private label has been a great weapon for us in defending our market position in Ireland.”

Crawford outlined the effects of the recession on consumer confi-

dence throughout Ireland and across Europe. “Consumer spending, in many countries, is remaining flat or in decline,” he said.

“Despite this unfavourable environment, we can reveal outstanding figures for SPAR world retail sales, which grew in 2012 by 2.7% to almost €32 billion, which is a fantastic achievement for our organisation.” See separate panel on SPAR International Results on page 20.

Finally, Crawford described the SPAR Congress as a “unique opportunity to share our successes and to

Mastering A New Reality Professor Stéphane Garelli from IMD, Lausanne, Switzerland, provided the keynote address on ‘Mastering a New Reality: a Competitiveness Outlook for 2013 and Beyond’. Having spoken at SPAR’s 2008 Congress, Professor Garelli provided a timely update on his previous presentation, with a fascinating examination of the global economy and where it might go from here.

“There is no doubt that the world as we knew it is broken down,” he revealed.

“The key issue today is to define what is the new normal.”

He discussed the debt in the OECD region, describing it as “disquieting, because we are playing with money as if it had no value.” Companies, he said, are still performing very well.

“We are dealing with an incredible pace of innovation,” he said, highlighting the growth of companies like Google, Facebook etc.

He provided a whirlwind trip around the world, predicting economic growth rates or lack thereof across Europe, the US, South America, Asia etc. “I think the world economy today is

Professor Stéphane Garelli from IMD, Lausanne, Switzerland, provided the keynote address on ‘Mastering a New Reality: a Competitiveness Outlook for 2013 and Beyond’.

in a very difficult situation and it is going to be some time before we get out of this, at least in Europe,” he warned.

Our “debt mountain” will be with us for some time, he noted. He pointed to Europe’s Central Bank as a problem, because it doesn’t operate like, for example, the US Central Bank.

The Austerity Conundrum Professor Garelli went on to discuss taxation systems, the banking situation, the legislative environment, and asked “Can austerity work?” After five years of austerity measures, debt has increased everywhere “because GDP has been falling faster than debt, so the ratio has increased”. He predicted that “we are going to revise austerity programmes very

quickly, at least in Europe.”

Looking at growing economies, he predicted the “globalisation of national champions… One of the biggest revolutions in the world economy today is the explosion of new brands.”

There are now over 1,000 firms from emerging economies with revenues of $1 billion: “We have a reshuffle of the world economy and new names, new brands are the name of the game.”

He spoke in detail about different economies, from emerging markets, which are a “first buy economy”, where consumers are purchasing items like mobile phones etc for the first time, compared to an economy of replacement (US, Europe, Japan), where the consumer can stop for a full year without buying non-essential goods and not

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International SPAR Congress

International SPAR Congress Leo Crawford, SPAR International President, addresses the International SPAR Congress.

Delegates at the International SPAR Congress 2013.

Dr Gordon Campbell, Managing Director, SPAR International, introduced the new SPAR International strategy, ‘Growing our Future Together’.

Willie O’Byrne, Managing Director of SPAR Ireland.

experience a drop in their standard of living.

“In the year 2000, the name of the game was ‘Shop Until You Drop’. Congratulations,” he said, “it’s done.”

Professor Garelli described unemployment levels as “unacceptable”. “If we don’t provide jobs for our younger generation, we are going to have a huge problem which is not just economical but social and political,” he said.

Looking to the future, he examined population trends across the world, with the growth of an emerging middle class and an emerging ‘less poor’, and the emergence of Africa as an economic force.

He discussed global energy usage, where the bulk of energy (75%)will remain fossil fuel-based, with gas the big winner. He pointed to an “energy renaissance” in the US, which will produce more gas than Russia by 2015 and more oil than Saudi Arabia by 2020. The result: the cost of electricity in Germany, for example, will be twice that of the US: “imagine the competitive advantage”.

Changing Your Mindset “In business, success is caused more by mental attitude than mental capacity,” he stressed. “The mindset is critical for success. One of the key mindsets now is that we have to accept uncertainties.”

He concluded by describing the keys to business success as “the management of efficiency, the management of change, the management of complexity.

We need to have a mindset of imagination that asks ‘Why not?’ rather than ‘why?’. We need a mindset of energy, a mindset of commitment. You have to ground that in a concept of legitimacy: why us?”

SPAR Ireland’s Success Following Professor Garelli, Willie O’Byrne, MD of SPAR Ireland, spoke of the passion the SPAR Ireland team bring to their work. He provided a brief history of SPAR in Ireland, which started back on April 2, 1963, when SPAR was launched in Ireland by three wholesale companies, Amalgamated Wholesalers, Munster United Merchants and Looney & Co: “Many years later, these companies would come together to form BWG Foods, the parent company of SPAR in Ireland today.”

O’Byrne described SPAR Ireland’s 50th birthday as a milestone, crowning a period of unprecedented change for the country and the retail industry: “Over the years, SPAR developed a reputation for innovation and we have changed the face of retailing here.”

Retail Never Stands Still He noted Ireland’s economic woes, but stressed that “whether the economy is booming or busting, retail never stands still.”

Last year saw SPAR Ireland forming a new plan for sustaining the business, having taken on board the opinions of their shoppers. “A strong price and value image was essential. SPAR has been associated with convenience retailing and its pricing reflected these economics and the low price elasticity of this sector in boom times. That price perception was a big negative,” he noted.

SPAR Ireland have worked hard to improve this image, through a range of

SPAR International Results 2012 SPAR worldwide retail sales grew to €32 billion in 2012, an increase of 2.8% on the previous year. SPAR now has retail operations in 34 countries and the global partnership encompasses 12,322 stores. SPAR will have retail operations in 36 countries when the first SPAR supermarkets open in Qatar and Lebanon later this year.

Speaking at the 58th International SPAR Congress in Killarney, SPAR International Managing Director, Dr Gordon Campbell said SPAR worldwide celebrated the 80th anniversary since its foundation in the Netherlands in 1932 with another year of continued growth.

This is a good result in the context of continued financial crisis in many SPAR countries.

SPAR China and SPAR Russia both broke through the €1 billion sales barrier.

Austria, by far the largest SPAR country, saw retail sales of €5.560 billion. South Africa’s sales in 2012 were € 4.563 billion, Italy’s were €3.611 billion and the UK’s were €3.149 billion. SPAR Spain’s retail sales of €1.248 billion were up 8.3%, with 170 new stores in Murcia and Catalonia. SPAR Poland opened their 100th store in the autumn and they opened their 115th store before the end of the year.

initiatives, including value offers, growing own brand, price matching with multiples etc.

However, “sophisticated strategies cannot compensate for failing to do the basics well,” O’Byrne revealed.

“In essence, our strategy is to grow the ways in which we are different and not become fixated on narrowing the gap with our competitors.”

He described the transformation of SPAR’s wholesale service in Ireland, with the opening of their new National Distribution Centre in Kilcarbery, and another distribution centre at Kilshane Cross.

“Next month, we will transform our ordering systems with the roll-out of a cloud based computer solution which will run on PC, tablet and smartphone,” he said.

“We strive for best-in-class supply chain solutions and our recent investments and quality focus is paying off.

But people buy from people and even as we improve the technology and use more automation, we are working hard to maintain personal relationships with

our retailers. Each one has an account manager, is encouraged to attend regular local cluster meetings and also attends an annual guild meeting, where the plans for the year are revealed and feedback taken.”

He explained how SPAR Ireland’s “strong people focus is a balance to the dangers that engineering excellence can dehumanise the business.

While you can achieve fantastic efficiencies, you can end up with a colder experience.”

Growing Our Future Together Dr Gordon Campbell, Managing Director, SPAR International, followed with an enlight-

ening presentation which introduced the new SPAR International strategy, ‘Growing our Future Together’. Dr Campbell informed delegates that international expansion has been a strategic goal of SPAR International since its establishment in 1953: “We seek to work with local partners who have the vision and capability of providing modern food retailing in their local market and who subscribe to the SPAR retailing principles.”

SPAR International will continue to work in developing markets with a key focus on Russia, China and the Middle East to expand the partner network.

In each market, SPAR International promotes a multi-format retail strategy of Hypermarket, Supermarket, Neighbourhood store and Convenience stores.

The 58th International SPAR Congress attracted delegates from across the 34 countries in which SPAR operates.