Supermarket Jumbo books mega turnovers with a black edge as corona champion
Supermarkets such as Jumbo and Ahold Delhaize took maximum advantage of the lockdowns in 2020 and the first months of this year, which meant that the catering industry and most ‘non-essential’ shops were closed. Ahold achieved a record turnover of 74.7 billion euros in 2020. Jumbo came to 9.69 billion, 15 percent more than in 2019. Prompt sang the question in political The Hague whether it was not fair to ask the ‘winners’ of the crisis a ‘corona tax’.
The image of the corona champion needs some nuance, says Van Veen. ‘Turnover is not yet profit. Of course we would not have wanted to grow due to the misery in other sectors, and that has happened in terms of turnover. I understand the social sentiment of a corona tax, but we are currently facing strong inflation. The business model of the supermarkets is under pressure due to higher costs, the shift to online and the influx of speed cameras.’
That is why a corona tax cannot be justified, according to Van Veen. Even a comparison with the largest competitor and market leader Ahold Delhaize is misplaced, according to him. ‘We have suffered a loss of tens of millions of euros with our La Place restaurants, and of course we have not applied for corona support. It would be socially inexplicable. Ahold surrounded itself with Etos, Gall and Gall who remained open during the lockdowns and Bol.com. How would you like to arrive at a fair additional tax?’
The turnover of restaurant chain La Place fell by 60 percent due to the forced closure. Yet Van Veen praises the concept as ‘the healthy alternative to fast food’. The reality in the shops is different, according to several health funds, 70 percent of unhealthy food comes from the shelves of the supermarkets. Van Veen denies that he is hiding behind consumer behaviour. ‘But the transition to healthy food is more an evolution than a revolution.’
Jumbo also counters the criticism of the FNV trade union that the announced reorganization is a ‘disguised cutback’. The position of department manager was cancelled, many employees had to reapply for their jobs. On Tuesday, the management announced that 98 percent of the employees have remained in service and have been relocated. ‘The union has spoken out of turn’, says Van Veen. “The criticism was premature. There is absolutely no question of a collective dismissal or a reduction in employment conditions.’
At the presentation of the half-year figures, Jumbo also boasts a successful campaign at the European Championship football. Tasteful or not, Frank Lammers and the Snollebollekes scored better than the Dutch team that was ingloriously eliminated by the Czech in the eighth finals. Yet after that failure, all commercials had to be taken off the tube immediately and Jumbo’s ‘cheer cape’ was worthless in one fell swoop.
According to ING economist Marten van Garderen, each round yielded the supermarkets ten million euros extra turnover and the departure of Orange meant a loss of 30 million. Van Veen disputes those figures. ‘We are not yet at half the amounts that I saw. It is precisely thanks to our advertising that we sometimes had up to 1 percent more market share than usual.’
In addition, Jumbo effortlessly switched to the Tour de France with Team Jumbo-Visma. The second place for Vingegaard and the four stage victories compensated for the failure of leader Roglic in the first week. ‘And Wout van Aert, as the sports hero of Flanders, has strengthened our position in Belgium.’
Will CEO Frits van Eerd be satisfied with the second place behind Ahold Delhaize in the jubilee year – a hundred years ago Johan van Eerd started a wholesaler in food in Veghel and the first Jumbo supermarket was opened 25 years ago?
Van Veen, laughing: ‘We have to be realistic. The difference between the numbers 1 and 2 in the Netherlands is still very large. Jumbo has enough challenges to remain a strong number 2. It is not a goal to surpass the market leader.’