According to the suppliers of vegetables and fruits of one of the largest supermarket chains in Ukraine “Silpo”, which is part of the Fozzy Group, the entire team responsible for the purchase of vegetables and fruits and management of the fruit and vegetable departments of the chain, was fired.
Obviously, the dismissal was unexpected, because more than a week had passed since the fruit and vegetable management was removed from work, and there is still no new team formed. Therefore, the management of the department is temporarily assigned to the management of other departments, completely unfamiliar with the specifics of the fruit and vegetable trade. Accordingly, this creates huge difficulties for suppliers and may affect the position of Silpo in the rating of supermarket chains in Ukraine. After all, it is the produce department that is decisive in estimating the retail business of any chain, as we have repeatedly proved by EastFruit audits in different countries.
By the way, EastFruit audits are also a good indicator for suppliers of fruits and vegetables. The chains at the bottom of the overall rating or those classified as “undesirable” often experience difficulties in timely payment for vegetables and fruits delivered to supermarkets. Suppliers of the Silpo chain have constantly complained to us about the delays in payment from the chain in recent years. The main competitor of Fozzy Group in the retail market of Ukraine, on the other hand, received positive reviews. This is an essential factor influencing the timely provision of high-quality and affordable products to supermarkets.
Why was the Silpo fruit and vegetable team dismissed? There is no reliable information on this, so we will rely on our own data from EastFruit retail audits. In fact, the Silpo chain has recently made some progress in fruit and vegetable ratings, although before that its supermarkets were for a long time at the bottom of the list long a of our ratings in Kyiv and other cities where the audit was carried out.
In July 2021, the Silpo chain had progress in terms of the most important criterion, its most problematic one in recent years – the price level for vegetables and fruits. However, it continued to lag behind competitors in terms of assortment, since there were stores of various formats under the Silpo brand: both large, arguably premium stores, and very small ones, with a small assortment and often low-quality products, similar to the convenience or discount stores. This blurred the overall performance of the chain in the ratings.
It should be noted that in addition to Silpo, the Fozzy Group includes supermarket chains Fozzy, Le Silpo, Fora, Thrash! They have different formats – for instance, Le Silpo is often found among the leaders of our rating of fruit and vegetable departments. Fora, on the other hand, is almost always one of the supermarkets at the bottom of the list, not to mention the chain with the eloquent name Thrash!.
According to the EastFruit analytical team’s estimates, made by indirect methods, the turnover of all Fozzy Group supermarket chains for fruits and vegetables in 2020 could be from 7.2 to 7.6 billion UAH, which corresponded to $260-280 million. This made the chain one of the largest sales markets for fresh fruits and vegetables in Ukraine. By the way, this approximately corresponded to the exports of all vegetables and fruits from Ukraine in a year!
That is why the management dismissal of the fruit and vegetable department of the Silpo supermarket chain and other chains of the Fozzy Group has a serious direct impact on the Ukrainian market for fresh vegetables, fruits and berries.
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