SWEDISH FOOD RETAILERS’ FEDERATION

MEMBERS OF SWEDISH FOOD RETAILERS’ FEDERATION 5

Companies run by Swedish Food Retailers’ Federation 4

The Grocery trade in Sweden HUI Research på uppdrag av Svensk Dagligvaruhandel September 2016 © HUI Research 2016

The food chain – from farm to fork Farmers Food industry Food retailers Consumers Restaurants, cafes increasing share © HUI Research 2016

The food industry – important for Sweden (turnover) The grocery trade accounts the biggest turnover in the food chain Source: Net sales 2014, from Business Economics (SCB). The grocery trade refers to SNI 47.11 + 47.2. Wholesale of food refers to SNI 46.3 (Wholesale of food, beverages and tobacco). Food manufacturers refer to SNI 10-12 (Food, beverage and tobacco production). © HUI Research 2016

The food industry – important for Sweden (employees) Young (16-24 år) Alla branscher 10,1% Jordbruk 8,4% Livsmedelstillverkare 14,4% Hotell & restaurang 39,5% Dagligvaru- & partihandel med livsmedel 26,7% Source: RAMS (refers to employment, night population, 2014). The grocery trade includes SNI 47.11 and 47.2. Wholesale trade in food refers to SNI 463 (Wholesale of food, beverages and tobacco). Food manufacturers refer to SNI 10-12 (Food, beverage and tobacco production). © HUI Research 2016

Number of stores (devided by turnover) Spread over the contry Number of stores (devided by turnover) 55.1 million and upward 0-5,5 mill. SEK The map shows the distribution of grocery stores across Sweden. A dot on the map corresponds to a store. 5,6-12,5 mill. SEK 22,6-55,0 million SEK 12,6-22,5 mill. SEK Källa: Delfi, 2015 © HUI Research 2016

Number of stores decreases Källa: Nielsen, number of stores in grocery trade. OBS! Time series breach between 2010 and 2011 when 325 stores included in the Axfood Group were excluded from being defined as Retail Trade. © HUI Research 2016

Consumer prices increase less than disposable income Disposable income increase by 50 percent since 2005. During the same period prices of meat, egg, veg and dairy have increased by 20-30 percent. Index 2005=100 Källa: Jordbruksverkets statistikdatabas, index 2005=100. SCB NR, sektorräkenskaper, löpande priser, HUI beräkning. © HUI Research 2016

Meat, Dairy, Fruit and veg largest categories Källa: SCB, 2014. © HUI Research 2016

Trends and consumer behavior 1. Growing health interest among consumers - Interest in vegetarian food as well as other health products increases. Organic Products continue to increase significantly. Private Label products are taking more and more market shares in all segments. The grocery trade increases sharply online and is expected to continue upwards. Consumers spend more and more share of income at the café’s and restaurants 2. 3. 4. 5. © HUI Research 2016

Vegetarian food increasing Index 2010=100 Source: Nielsen Scantrack, Market Review of DVH. As vegetarian food, here are frozen and fresh vegetarian foods, as well as dried peas / beans / lentils and preserved peas / beans. © HUI Research 2016

Organic food increasing Källa: SCB, 2014. © HUI Research 2016

Organic largest share within fish and fruit Fish, fruit, vegetables and coffee, tea and cocoa have the largest share of organic All categories have increased their share of organic, fish (including MSC) and fruit has grown the most Källa: SCB, 2014. © HUI Research 2016

Private Label share increasing Share of EMV on total food sales in Sweden (2014) Percentage of EMV International (2014) Switzerland 45% United Kingdom 41% Germany 34% France 28% Denmark 25% Sweden 23% Finland 22% Norway 21% Italy 17% Russia 6% Source: Statistics Sweden, 2014. Nielsen, 2014. International shares are based on the sum of mean values from all categories, hence some difference to the figures presented in the chart. © HUI Research 2016

Private label share within various categories Källa: SCB, 2014. © HUI Research 2016

Grocey on line increasing Online grocery sales online 2009-2016 Regular on line vs ready made dinner solutions Källa: HUI/Svensk Digital Handel 2016 © HUI Research 2016

Changing consumption Share of house hold expenditure Källa: Andel av hushållens konsumtion efter ändamål (exklusive utlandsnettot), löpande priser, 2015, från NR (SCB). © HUI Research 2016

KPI’s © HUI Research 2016

Margins in grocery trade low % av omsättning % av omsättning Källa: SCB, 2014. Siffrorna avser medianer under 2014. © HUI Research 2016

High turnover foundation for profit tkr Källa: SCB, 2014. Siffrorna avser medianer under 2014. © HUI Research 2016