27 Jul 2018 13:07

Magnit to update half of supermarkets by year's end, drafts new hypermarket concept

MOSCOW. July 27 (Interfax) - Magnit , Russia's second largest retailer, expects to update half of its supermarkets by the end of the year and is preparing a new concept for its hypermarkets.

"A plan has been approved to redesign existing supermarkets to the end of the year. More than 80 supermarkets will be updated in 2018, and all new supermarkets will be opened in the new concept. Taking into account stores that are already operating in the updated format, at the end of this year about 50% or 100 Magnit Semeiny supermarkets will be in the updated format," Magnit CEO Olga Naumova said in a conference call on Thursday. She said 14 existing stores had been updated by July 1.

"Key changes involve communications with shoppers with an emphasis on the redistribution of the share of nonfood in favor of food products, and expansion of the assortment of prepared dishes and the fresh category," Naumova said.

Magnit has also worked out a technology to redesign existing supermarkets in a light format that does not require store closures and the suspension of sales. "This enables us to minimize the reduction of revenue and eliminates the loss of regular customers," Naumova said.

The retailer is also working on updating the concept for its hypermarkets, but is keeping a compact format. "We are now preparing the hypermarket concept. Magnit operates in a compact format, with average store size of less than 4,000 square meters. Taking into account changing consumer behavior, we are objectively already in a more correct niche and will develop this format - compact hypermarket. It's important for stores to meet customer expectations in the long term," Naumova said.