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Biggest supermarket chains in Poland vs Germany


beaware2 2 | 9
3 Jan 2016 #1
Hi guys

I recently have been speaking with some polish people about how in Poland there are supermarket chains from several countries mostly German ones, but also French (Carrefour) and Britisch (Tesco) and that the new polish government wants to introduce taxes to these foreign supermarket chains, germans are complaining about that. In Poland there are still a lot of small supermarket which are on polish hands.

I am for open market and it is very nice to have different choices of supermarkets and products, however I have been checking the situation in Germany. There are basically no big foreign supermarket chains operating in Germany and the laws in Germany make it hard for non-german supermarket chains to operate in Germany (no Tesco, no Carrefour etc).

I mean, the point is, why the germans are complaining about the new taxes to their supermarket chains in Poland while they do not allow foreign supermarkets on their soil?
smurf 39 | 1,981
3 Jan 2016 #2
why the germans are complaining about the new taxes to their supermarket chains in Poland while they do not allow foreign supermarkets on their soil?

Well, the thing is, like with the stupid levy that Pi$ have put on the banks this will only end up costing consumers more.
Yea, they govt will receive more tax money from this, but the shops will just do the obvious (like the banks already have) and increase prices so it ends up being yet another stealth tax on the consumer.

I don't really understand why they must be so sneaky about these levies, if I were in charge I'd come up with a simple road tax where 1% of people's wages goes into that fund.

Another potential tax idea that would be better would be something like in Ireland with the USC tax.
Why can't they just be upfront about it?

Why are the German chains complaining? That's pretty obvious. They are here for profit, this stupid 'tax' eats into it and will end up with them putting their prices up, meaning consumers will be somewhat disgruntled and leads to bad PR for them. Tesco and the French chains (you left out Leclerc & Auchan) are in the same boat.
cms 9 | 1,271
3 Jan 2016 #3
They are allowed - its just competing with Lidl and Aldi on their own turf is extremely difficult. In the non food sector there are some very successful operators in Germany - Zara from Spain, Primark from UK, jysk from Denmark.
smurf 39 | 1,981
3 Jan 2016 #4
while they do not allow foreign supermarkets on their soil?

Just a quick google shows that there are plenty of 'foreign' supermarkets in Germany; Spar for example, they are Dutch.
OP beaware2 2 | 9
3 Jan 2016 #5
Spar is dutch, however the german branch was bought by EDEKA
kpc21 1 | 763
3 Jan 2016 #6
There is many big supermarket chains in Germany, but they all are German. I am talking about shops one of which you can meet even in a smaller town or a village, and in bigger cities there is many of them.

In Poland we have some Polish chains, especially ones based on franchise, but they are the minority. The biggest chain of supermarkets is Portugese, there is also plenty of Lidls, Aldis, Carrefours (of different size, often also franchise-based), Tescos or InterMarches. On the other hand, there is also plenty of small "convenience" gorcery shops that don't belong to any chain. And there is nothing like that in Germany. You have Lidls, Aldis, Rewes, Edekas, Nettos, Nahkaufs (being in fact Rewes), Pennys (belonging in fact to Edeka), some variations of Edeka with different names, sometimes a Kaufland, from time to time a huge hypermarket (we call them so in Poland) of Real - and that's all. I have been living in Germany for half a year and I haven't seen any independent grocery shop there, apart from the Turkish ones, and maybe some with "Bio" food (but they usually also belong to some chains).
OP beaware2 2 | 9
3 Jan 2016 #7
I am talking about shops one of which you can meet even in a smaller town or a village, and in bigger cities there is many of them.

Yes that is what I see also. The big supermarket chains in Germany are all German. The laws in Germany make it difficult to non-german supermarket chains to flourish in Germany. On the other hand, in Poland you have chains from several countries and many german ones. With the new polish government, the germans complain about a new tax to their supermarket whereas they don't allow any big foreign supermarket on their country.

The germans seem to be quite hypocrite on this matter. They want open and accessible market (for instance in Poland) since they profit from that, however, they don't allow the same the other-way around.
delphiandomine 88 | 18,858
3 Jan 2016 #8
There are basically no big foreign supermarket chains operating in Germany and the laws in Germany make it hard for non-german supermarket chains to operate in Germany (no Tesco, no Carrefour etc).

It's worth bearing in mind that the German shopping culture is quite strange by European standards. It's only in the last few years that credit/debit card use has been widespread in shops for instance, and they also like their "discount markets" much more than other Europeans. It's why Netto has succeeded there while others haven't. The Germans also haven't really taken to Polish/British style hypermarkets too, which also doesn't help any potential competitor. Then you've got the way that you need to make a profit on relatively restricted opening hours.

Nothing is stopping Polish companies from expanding there, and I think the Alma concept in particular could succeed.
Wulkan - | 3,250
3 Jan 2016 #9
Well, the thing is, like with the stupid levy that Pi$ have put on the banks this will only end up costing consumers more.

You are very wrong, why foreign supermarkets are supposed to pay less tax than smaller local ones because that's the case at the moment.
TheOther 5 | 3,758
3 Jan 2016 #10
The laws in Germany make it difficult to non-german supermarket chains to flourish in Germany.

That's nonsense. The simple truth is that the German market is so competitive that foreign companies have no chance against the established local businesses. Even Walmart had to give up a few years ago, and that means something.
kpc21 1 | 763
3 Jan 2016 #11
On the other hand, Real - a German hypermarket chain - had to give up in Poland not a long time ago :-) And they sold all their shops to the French (they got taken over by Auchan).

Something like 5-10 years earlier - the German discount chain Plus-Discount (now in Germany it's, as far as I know, Netto, but it's a different Netto than the Netto present in Poland, if I am not mistaken, it belongs to Edeka) also had to give up in Poland, and they sold all their shops to Biedronka (Jeronimo Martins), so now they are Portugese.

The higher taxes for supermarket chains are supposed to help smaller private independent shops. Which are not present at all in Germany. Protect them is exactly what Poland should do.

In fact the only German supermarket branches that are present in Poland are the cheapest ones: Lidl and Aldi. Also Kaufland, and until the previous year also Real. From the grocery supermarkets that's all. Apart from that some specialistic chains from Germany, like Media Markt/Saturn, or Rossmann, are strong in Poland.
cms 9 | 1,271
3 Jan 2016 #12
wulkan the data i saw on money.pl today was qute different - foreign supermarkets pay much higher tax, both in absolute terms (something like 10x the amount paid by Polo, Stokrotka etc) and as a perćentage of the top line.
mafketis 24 | 9,361
3 Jan 2016 #13
wulkan the data i saw on money.pl today was qute different - foreign supermarkets pay much higher tax

HERESY! PiS told him otherwise, he cannot afford to believe they would lie to him!
kpc21 1 | 763
3 Jan 2016 #14
That's what most people in Poland think, that the foreign supermarket chains don't pay taxes in Poland. That they avoid them using some legal tricks. I have no idea whether it's true or not.
delphiandomine 88 | 18,858
3 Jan 2016 #15
That's nonsense. The simple truth is that the German market is so competitive that foreign companies have no chance against the established local businesses.

Indeed, it's pretty clear to anyone that spends time in Germany that the German model of retailing is very difficult to make an in-road into. I hate the way that Germany does supermarkets - only Kaiser's seems to be tolerable and on the level of a normal supermarket. And even then, a few years ago, they were also mostly horrid "diskont-markt" crap.

Protect them is exactly what Poland should do.

They will actually do the exact opposite. Biedronka already signalled that if the tax comes in, they'll just abandon the old strategy and move to building 249sqm local shops instead everywhere. The brand is worth so much (and their buying power is so strong) that it will actually destroy the local shops as a consequence.

Furthermore, PiS are relying on people being ignorant. The tax will actually hurt consumers and suppliers, not the supermarkets.

If PiS genuinely wanted to help local retail stores, they would allow shops under a certain size (100sqm could be a good benchmark) to not pay ZUS contributions provided it was owner-operated. 1100zł a month is nothing if you own a 249sqm shop, but a 20-30sqm shop is crippled by such tax.
TheOther 5 | 3,758
4 Jan 2016 #16
I hate the way that Germany does supermarkets

It's a direct result of the German trait to save money wherever possible. The retailers have adapted to that.
Wulkan - | 3,250
4 Jan 2016 #17
foreign supermarkets pay much higher tax, both in absolute terms (something like 10x the amount paid by Polo, Stokrotka etc) and as a perćentage of the top line.

But no link? how typical.

foreign supermarket chains don't pay taxes in Poland. That they avoid them using some legal tricks. I have no idea whether it's true or not.

Unfortunately it is.
Alidk
4 Jan 2016 #18
Just to clarify, In germany there is only one forening Company that are still operating and that is netto( the yellow one, not the red - that is the same we have in Poland) it's a Danish company. And it's simply because of the hard competition and not that the government are favoring them.

The PIS tax is a own-goal! The consumers will be the looser in the long run. Retail is a business and not charity work, and when this tax will be introduced the retailers will adjust the prices to maintain the profit:/

And don't forget all the tax that already is generated from the retailers. It's nothing else than populism and propaganda when people are saying that they aren't paying taxes. What about all the tax on wages, what about all the VAT? Or when they a buying from local suppliers? It's all about looking at a bigger picture :)
Wulkan - | 3,250
4 Jan 2016 #19
the retailers will adjust the prices to maintain the profit:/

They won't because in that case they will "loose" too many costumers and that will definitely effect the profits. The main bosses will have to buy for themselves slightly less expensive ferrari at the end of the year back home in Germany.
cms 9 | 1,271
4 Jan 2016 #20
Sorry wulkan - its too much hassle to post links on my tablet - but the same data was in most of the Polish business press and when I am back on my laptop I will post it.

i am unsure why supporting small shops is seen as desirable policy - when I first came to Poland that was all there was and the service was awful - you had to get meat, dairy, veg, sweets from different counters, queue and pay 4 times, could not touch the products as they were behind a vitrine, you could not always expect a fridge on a hot day, I also remember some bizarre policies where you had to carry a basket even if you only wanted to buy a quart of milk. It was obvious this model would be wiped out once duties were abolished after EU entry.
kpc21 1 | 763
4 Jan 2016 #21
Everyone knows that the PiS tax is in fact not about helping private shops, but about gathering money to have something to be able to pay out the promised 300 zł for each child... Even PiS themselves say that. But (for the fans of Polish idioms :-) ) a cactoo will sooner grow up on my head than I will see 300 zł really given to each parent for each child by the government. They need money to finance events like Wieczornica Smoleńska, or for dinners in expensive restaurants where they discuss top-secret issues (as PO did, I don't believe PiS is different).

i am unsure why supporting small shops is seen as desirable policy - when I first came to Poland that was all there was and the service was awful

It depends on a specific store. We want to have free market - which wouldn't be dominated by huge chains, as it is in Germany (even though all of them in Germany are German). But whether something like that would work, I am also unsure.

Maybe it wasn't an independent store, but one belonging to one of the chains from the communist times: Społem or GS?

About small shops, we already have Żabka (which was grounded by a Pole, for some time it was Czech, but now it seems to be British), however, they are not present everywhere and it's not a problem to meet also an independent store of such size. It's more difficult in case of supermarkets, but it's easily understandable as they were brought to Poland by them (before there were only some smaller ones from the 1970s, belonging to the state company Społem).
mafketis 24 | 9,361
4 Jan 2016 #22
dinners in expensive restaurants where they discuss top-secret issues (as PO did, I don't believe PiS is different).

The biggest difference is that PO tried to maintain a semblance of rule of law (though often it fell short of its goals) while PiS under the leadership of JK makes no pretense of doing anything but tossing off tired platitudes that resonate with the most poorly educated voters and gathering as much power to distribute to its allies as possible. Its supporters are mostly gullible or on the take watering at the mouth at the spoils, muttering "TKM!" (the dominant theme in Polish electoral politics).
irishlodz 1 | 135
4 Jan 2016 #23
Another potential tax idea that would be better would be something like in Ireland with the USC tax.

You could not suggest a more unpopular idea. It is detested by the Irish and all parties are committed to abolishing it.

I'd come up with a simple road tax where 1% of people's wages goes into that fund.

Ditto. And why should the unemployed drive for free. Or employees pay for their employer to use roads for work?

There are basically no big foreign supermarket chains operating in Germany and the laws in Germany make it hard for non-german supermarket chains to operate in Germany (no Tesco, no Carrefour etc).

There is nothing to stop either entering this market. The Germans are very price concious and have poor brand loyalty. Put simply, they are smarter than the rest. The mighty WalMart entered and then left with their tails between their legs. The discounter format is wiping the eye of the hypermarket. The Germans invented the discount format. Discounters have gone from 0 to 16% in Ireland in roughly the same number of years, just broke 10% in the UK. No sign of slowing either.

I think the Alma concept in particular could succeed.

They would want to make a profit for once in Poland before taking on expansion.

PiS are relying on people being ignorant. The tax will actually hurt consumers and suppliers, not the supermarkets.

+1. If Pis think they can solve an issue of competition by tax they are just proving themselves to be morons. The biggest issue hindering the independent grocery sector is competition, and in particular access to international brands for smaller wholesalers. Major manufacturers have a warped system here of selling huge volumes only (P&G do it globally). The massive players can buy directly from them, but everyone else must buy from agents. This creates layers of costs. There is extremely poor competition in the wholesale/cash&carry trade. I have often seen promotions where supermarkets were cheaper than wholesale. I'm not talking about loss leading either. Selgros, Makro and Eurocash (which is a franchise) are the only operators. In a country this size there should be hundreds of independent cash & carries. They can't get a foot on the ladder.

The simple reason there are almost no Polish chains is that cash was needed for the gold-rush of the 90's, no Polish company had it. The westerners did however.


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