Ivan Beloica (right) from Delhaize at a recent tour of Tempo during Forum South-East Europe 2016.
Export is becoming more and more important in the market, year on year. From 2002, there has been surplus in foreign trade. However, around 60% of goods are still sent out to the open market in Serbia, with only 40% allocated for modern trade. However, Deloica said that more and more are switching over, after they realise that there is more consistency and transparency within the modern market and more opportunities for discounts.
"A larger company like Delhaize can also offer better food safety methods for our customers. We have out own lab to keep food quality at top levels. Our lab takes samples at the grower level, in the fields and in the storage facilities, so we can say that we are 100% sure we are offering our customers a healthy product." assured Beloica.
When looking for supply partners, Beloica said that they work by contract and are not looking for short term suppliers. When they start working with growers, it is with the idea that they will become partners for at least 5-10 years.
Delhaize Serbia cooperates with suppliers from more than 30 countries. Every supplier must conform to four main requirements; 1. To follow product specifications for quality and standards in production and packaging, 2. Quality certification (Global GAP, BRC), 3. Competitive prices and promotion participation, 4. Meet minimum volumes defined on a yearly level.
Education is key
Delhaize has three different formats in Serbia, Maxi (supermarket), Shop and Go (corner shop) and Tempo (hypermarket). The smaller and medium formats are on the rise, with the hypermarkets seeing a decline, in keeping with recent trends around the EU.
"I think that the supermarkets are seeing larger growth because of the service. Customers like more information about the products and the sales level in our supermarkets is on a higher level than the Hypermarkets. They are often closer to the customer, for example, you have to go with a car to get to the hypermarkets, which means it is necessary to do a weeks worth of shopping in one go. It is not possible to buy all of your needs, especially fresh fruits and vegetables, on a weekly level." said Beloica.
Delhaize in particular, has made educating consumers a big part of their marketing program, which has proven successful. They offer their customers new varieties and give them the opportunity to taste them. They also educate in the form of company flyers, giving customers extra information about nutritional benefits and ideas on how to prepare the fruit or veg. For example, Ivan shared that after the launch of a celery campaign, sales went up by 5 times. It doesn't matter if it is a 'cheaper' product, they want to be informed. They want to know the origin and the flavour. They are constantly trying to offer a wide range to their customers.
"It is our goal to offer an extended range of products, apples for example, we want to have the different varieties so we can offer different options to fit our shopper's preferences. We give them the tools to make the right decisions to pick the right apple to suit their tastes and we have noticed after education campaigns that consumers are willing to pay up to 10-15% for the apple they like best."
"In Serbia people had been buying potatoes by colour, and there has been a lot of misinformation in the past. For example, they think that if you want to make french fries, you should choose only red skinned potatoes. This isn't true, there are special varieties of yellow skinned potatoes which can make even tastier fries and we need to convince them with education. When we promote the right varieties, they have a good experience, which can increase sales." said Beloica.