The Magnit company, which operates the second largest grocery store chain in Russia, has announced the launch of a new format.
The retailer decided to develop its own alcohol markets under the Magnit Evening brand. The first retail facility of the new network will appear in Samara. The area of the store will be about 200 square meters, the assortment will be 2500 articles.
The experiment to open individual stores that will specialize in the sale of alcoholic beverages and related products will last from three to six months, after which the company will decide on the possible scaling of the new retail project.
Experts believe that the development of the new network is part of the company's strategy to strengthen the ultra-small format business. Earlier, Magnit also began to experiment with opening small stores at post office areas and at gas stations on federal highways.
In the first Magnit Vecherniy store, up to a third of the entire assortment will presumably fall on the retailer's own trademarks, which will help the company increase the margin of the project. In an ordinary convenience store, the share of private labels rarely exceeds 15%. According to expert estimates, Magnit will be able to open several hundred alcohol stores in a year, but it will be difficult to compete with the largest networks. Market participants believe that after the experiment, the retailer will keep plans to develop a new format.
At the end of 2015, Magnit's main competitor, X5 Retail Group, launched the format of its own alcohol stores under the Pyatnitsa brand. To date, the network operates several dozen stores. The market leader remains Krasnoe i Beloe, which has been the fastest growing company on the Russian retail market over the past few years. Today, in convenience stores, alcoholic products account for up to 40% of all sales, in supermarkets - up to 25%, and in hypermarkets - up to 12%.