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Wednesday, February 1, 2023

Inflation: Rewe boss: Significantly less profit in the supermarkets

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The Cologne retail giant is feeling the higher costs for goods, personnel and energy. And dark clouds are gathering again over the tourism business after the recovery from the corona pandemic.

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The retail giant Rewe also felt the negative effects of the enormous increase in energy prices and high inflation in its supermarkets in 2022. “The supermarkets will make significantly less profit than in the past two years,” said Rewe boss Lionel Souque of the German Press Agency.

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Turnover in the food trade increased significantly again in 2022. “But that’s not just healthy growth, because it’s not being driven by volume growth, it’s mainly due to inflation.” Because of the higher costs for goods, personnel, energy and logistics, it is not associated with a better result – on the contrary.

In the online business, which is becoming increasingly important for the food trade, the Cologne-based company is still in the red despite high investments. “It will probably take a few more years before we break even. But we are firmly convinced of our commitment in this area,” said Souque. Measured as a percentage of sales, the losses have already fallen significantly.

Pick-up service is developing positively

Rewe offers a delivery service for goods ordered online in numerous German cities. In addition, more and more Rewe supermarkets have a pick-up service where products ordered online are waiting for the customer in the store a few hours later, ready to be picked up. “The pick-up service in particular has developed well recently,” said Souque. It is convenient for the customers. And Rewe saves “half the costs because we don’t have to deliver to your home”.

In the Rewe tourism division, which includes tour operators such as Dertour, Jahn-Reisen and ITS, sales after the slump caused by the pandemic in 2022 rose again to the pre-corona level, the manager reported. When it comes to winning, however, things are not looking so good. “We should just manage to get a black zero or a red zero,” said Souque. The numerous problems at the airports and many cancellations of flights would have cost Rewe, as a tour operator, who had to find a solution for the customer, a lot of money.

In the new year, the Rewe boss expects inflation to have a noticeable impact on the tourism business. “I am firmly convinced that some people will have to forego traveling in the new year due to tight budgets.”

Source: Stern

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