New Planning Act might change Danish grocery retail market

      Comments Off on New Planning Act might change Danish grocery retail market

A free planning legislation can cause a big change in Danish retail market.

Rema 1000, with ambitions to open 400 more stores in Denmark might knock out local stores, but also face unexpected competition from Bilka and Føtex as they can expand with more and larger hypermarkets.

Now, the food industry is waiting eagerly for a new draft to the Planning Act from the government. Planning Act’s current provisions on retail aim that shops must generally be located in the central part of a city or town, while there is a limit to the size of, for example hypermarkets.

A liberalization of the Planning Act would be a great opportunity to be bigger and might have consequences for the little ones as discount chains can move into the villages and replace the local stores.

“We believe there is room for at least 400 Rema 1000 stores in Denmark,” Henrik Burkal, CEO of Rema Denmark, tells Berlingske Business.

He says the stores can be all over the country and not just in cities, where Rema 1000 has so far been most visible.

“We do not see the great need for changes to the Planning Act. We see only a need for a more liberal interpretation of the current legislation, so people in the outskirts of Denmark can ensure cheap food locally. ”

At the same time, hypermarkets are expected to gain market share until 2025. Retail Institute Scandinavia’s forecast believes Dansk Supermarked will grow by eight percent in number of stores up to 2025, while Rema 1000 in 2025 will have 355 stores.

CEO Per Bank, just says Dansk Supermarked’s strategy is clear, regardless of how the law develops.

“We organize our business by the current legislation and not on the basis of how it may come to look like”.