Why Hypermarket Surfaces Will Shrink

I guess you have been to a hypermarket at least once in your life since these big stores existed and the first time you stepped in, surely you were amazed by the surface size, the displays, the offerings and how huge the store is, you looked both ways and you could not see where it ends. But maybe soon and in my opinion, this will be a memory because I think the supermarkets and mainly hypermarkets surfaces in Europe will shrink more and more.
So you might be wondering why?

Many people might say that French are rude and arrogant, but when it comes to retail distribution, no one can deny that they are the kings of retail distribution (in french: la grande distribution) and they are the trend setters in this sector. in Europe they are the leaders and all the others follow.

Having said this, we should not forget other major European players such as Tesco (United Kingdom) and Metro Group (Germany).

During my career path, I had the chance to explore this French style of doing business when I was a buyer for Monoprix in Lebanon and wherever you go, no matter in which country, it is known that buyers are arrogant, not sure if this is linked to the French thing mentioned previously but I can easily say that it was a hell of an experience I had.

Lately I have been monitoring the French retail distribution scene more and very closely because of a dedicated project and during my last trip to France, I had this feeling that surfaces of hypermarkets will start shrinking because of the specialized stores growth.

Hypermarkets are big, they can vary from 3,000m² up to 25,000m², which means the operational cost is huge and with bad economies the average basket is down. Previously this difference was compensated from the non-food categories which is not the case anymore nowadays, even the problem is touching some of the food categories. Therefore very soon supermarkets and hypermarkets, will skip lots of categories and focus more on food and fight for more margins and discounts.

New store types were and are emerging more and more, taking away the small categories from the hypermarkets and turning them into more specialized store types, giving more focused experience and offering wider selection for the consumers.

The below table will show you the alternatives of some hypermarket categories.