Press releases

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together more than 14 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

• The Eurocash Group's revenues for the nine months of 2018 exceeded PLN 17 billion and were almost 9% higher than in the same period of 2017.
• In the wholesale segment, the Group notes a further improvement in results: sales of this segment in the first three quarters of this year increased by more than 6% y/y to PLN 13.4 billion, and EBITDA (operating result plus depreciation) reached PLN 291 million, which means an increase of 22% y/y.
• Sales of the retail segment in the nine months of 2018 exceeded PLN 3 billion and were 18% higher than a year ago. EBITDA of this segment amounted to PLN 63 million compared to PLN 106 million a year earlier. The lower profitability of the retail is influenced by the costs associated with the integration of the acquired supermarket chains EKO and Mila.
• The fresh products supply project developed by the Eurocash Group, which is key to strengthening the competitive position of independent retailers, brought in PLN 452 million in revenue between January and September this year and reached the break-even point in the third quarter — much faster than the original expectations.
• Normalized EBITDA (excluding one-time costs) for the entire Eurocash Group after nine months of 2018 amounted to PLN 265 million, which means an increase of 2% y/y.
• Normalized consolidated net profit for the first three quarters of this year amounted to PLN 59 million compared to PLN 75 million a year ago. The lower level of net profit was mainly related to an increase in depreciation costs (primarily in the retail segment), as well as an increase in financial costs and a higher effective tax rate. In the third quarter of this year alone, net profit amounted to PLN 38 million and was 2% higher than in the same period of 2017.
• The Eurocash Group's activities are characterized by strong positive flows from operating activities, which amounted to PLN 301 million in the nine months of 2018 and PLN 115 million in the third quarter alone. This allowed a reduction in net debt at the end of September by PLN 77 million compared to the end of June this year and the net debt ratio to 1.67x EBITDA (from 1.9x EBITDA a quarter earlier).

Further growth and efficiency improvement in wholesale

“Small-format stores, which are the main customers of the Eurocash Group, are doing better this year than the entire FMCG industry on average. Total sales of the so-called small format in the nine months of 2018 increased by 6.3% year-on-year. Sales of our wholesale segment grew at a similar rate. What is very pleasing to us, the increase in wholesale sales goes hand in hand with further improvement in efficiency, which translated into a 22% increase in EBITDA in this segment — indicated Jacek Owczarek, Member of the Management Board and Chief Financial Officer of the Eurocash Group.

In the third quarter of this year, like-for-like sales at Eurocash Cash & Carry wholesalers grew by 3.8% y/y, and cumulatively for the nine months of 2018 were 2.8% higher than a year earlier, which is the best result of this format in five years.

Very good sales results of the wholesale segment in the first three quarters of this year were also made up of 11% growth in the active distribution format (Eurocash Dystrybucja), including more than 10% increase in sales to customers associated in franchise and partner chains, such as Lewiatan, Euro Sklep, Groszek and PSD (Gama).

An important event in the third quarter of 2018 was the launch of eurocash.pl — the largest e-commerce platform for independent trade in Poland, in which the Eurocash Group invested approximately PLN 15 million. “This innovative and industry-unique B2B platform is another groundbreaking tool for independent retailers to compete effectively with discounters and other big-box stores. Eurocash Dystrybucja customers can use it from September, and from next year we will start making it available to the customers of the other business units of the Eurocash Group —announced Jacek Ovczarek.

Detail influenced by the integration of acquired networks

In the retail segment, during the nine months of this year, the Eurocash Group recorded an increase of over 18% year-on-year, to more than PLN 3 billion, mainly due to the consolidation of the Mila network, the acquisition of which was finalized in May. “Mila contributed an increasing amount to our reported sales of PLN 466 million. Taking into account the revenues of the Mila chain since the beginning of the year, the pro forma sales of the retail segment would amount to more than PLN 3.6 billion, i.e. 41% more than a year earlier — indicated Member of the Management Board of Eurocash.

“Thanks to this acquisition, as well as the previous acquisition of EKO, the chain of “proximity” supermarkets built by us, including our own and franchise Delikatesy Centrum stores, already has more than 1,500 outlets. The current and next year will be marked by the integration of the acquired entities. In addition to rebranding, accompanied by remodeling and renovation of facilities, we integrate, among others, logistics, administration, operational activities, pricing and assortment policy. Integration costs naturally weigh on the current profitability of the retail segment, but are necessary to ultimately achieve efficiencies across the chain similar to those achieved by Delicatesy Centrum stores — added Jacek Ovczarek.

Project 'Fresh' is now profitable

The current profitability of the Eurocash Group is also negatively affected by the Projects segment, which includes investments in the development of innovative retail formats such as Big Ben (liquor stores), abc on wheels (mobile grocery stores) and Kontigo (cosmetics stores), as well as the development of the distribution of high-quality fresh products. The negative impact of this segment on EBITDA in the first three quarters of the current year was PLN 7 million (17%) lower than in the same period last year.

“The fresh article delivery project we are developing significantly strengthens the competitive position of independent retailers. This project generated PLN 452 million in revenue in the period from January to September this year and reached the break-even point in the third quarter — much faster than our initial expectations — underlined Jacek Ovczarek.

Profitable PayUp Sales

An important event in the third quarter of this year was also the conclusion by the Eurocash Group of a preliminary agreement to sell 100% of the shares of PayUp Polska, which manages a network of payment terminals installed in retail stores throughout the country. The completion of the transaction will have a significant positive impact on the Group's financial results. The sale price of 100% of PayUp Polska shares has been set at PLN 110 million, and the final price may be adjusted, depending on PayUp's achievement of the agreed financial parameters. In 2017, PayUp Polska's unit revenue (excluding IFRS 15) amounted to over PLN 440 million and EBITDA reached PLN 5.8 million.

— PayUp acquires a strong strategic partner — Polskie ePayments, which will ensure the further development of this company. Eurocash Group will focus on core business and development of new projects supporting the competitiveness of independent trade in Poland — summed up Chief Financial Officer of the Eurocash Group.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together more than 14 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

What do Poles consider a manifestation of local patriotism? According to the vast majority of respondents to the nationwide survey, commissioned by the Eurocash Group, the 5 most patriotic behaviors towards a small homeland are: concern for the nearest public space, participation in local cultural events, involvement in discussions on local issues, cheering for the local sports team and shopping in a small, residential store. This attitude of Poles towards local patriotism was also confirmed in the recently concluded grant competition “Local Heroes”, which drew attention to the social role of entrepreneurs — owners of small-format stores. Their customers made over half a million purchases in two months to increase their community's chance of accomplishing their chosen social project. Eurocash Group will spend PLN 1.5 million on grants awarded as part of the competition.

The behavior considered by the Poles surveyed to be the most patriotic is to take care of the nearest public space, such as cleaning sidewalks or planting trees (77.7% answered yes). The next place is occupied by activities in which respondents appreciated maintaining a strong connection with local culture (70.9%), politics (69.7%) and sport (66%). The majority of respondents also support local economic patriotism, which can be considered as shopping in small, family-owned stores close to home (61.7%).

“Women are slightly more likely than men to consider shopping in neighborhood stores as a manifestation of local patriotism. Men, on the other hand, are more likely than women to choose to participate in community consultations or debates on local issues. Everyone is united by a great commitment to small homelands, which is confirmed both by our research and the great commitment of consumers to the action “Local Heroes. 100 Entrepreneurs' Initiatives for the 100th Anniversary of Independence” — says Marta Gampf, Marketing Director at Eurocash Group, the initiator of the action.

The results of the opinion poll conducted on the occasion of the conclusion of the grant competition “Local Heroes — 100 Entrepreneurs' Initiatives for the 100th Anniversary of Independence” coincide with the results of voting in the competition itself. The most popular initiatives that have won grants funded by the Eurocash Group are related to local sport, culture and community space.

A record number of votes were collected for the purchase of kayaking equipment needed to organize free kayaking trips for residents of the municipalities of Trzebiel, Tuplice, Brody Żarskie and children from orphanages in Żary and Lubsk, in the Lubuskie Voivodeship. A grant of PLN 100,000 went to the originators.

- For the project, which we submitted together with the Association of Friends of Children and Youth “DELFINEK”, more than 141,000 votes were cast in the online vote and I admit honestly we still have a hard time believing it — says Dorota Kardasz, owner of the Lewiatan store in Olszyn in the Lubuskie Voivodeship. The grant will be used for the purchase of kayaking equipment, which will allow the residents of the municipalities of Trzebiel, Tuplice and Brody Żarskie, and at the same time the customers of my shop in Olszyn, to organize professional rafting. Now we will finally be able to get to know each other better and spend some time with each other. We will also lend equipment to local organizations, schools or orphanages — adds Dorota's spouse, Marek Kardasz. The scale of support and commitment exceeded our wildest expectations. The vote on our initiative was encouraged by local authorities and the media. We also set up a Facebook profile where you could learn more about our idea and share this information further. We even printed special posters and leaflets that were distributed by volunteers at local events. I am immensely grateful to all these people. There will be an opportunity to get to know each other better and spend some time with each other. I'm looking forward to our first trip together,” he adds.

A total of 5,316,409 points were collected on the accounts of all initiatives during the voting, which ultimately determined the winning local initiatives, among others: inclusion of autistic children and their families in active functioning in public space, construction of a skate park, toboggan hill and forest bicycle routes, co-financing of local clubs and sports teams, retrofitting of gyms, improvement of conditions for community centres, schools and kindergartens, assistance to hedgehogs and stray animals and the organisation of local concerts and festivals. Co-financing from the Eurocash Group will receive 100 initiatives from all voivodships in Poland.

Residents of the Warmian-Masurian voivodships (about PLN 190,000), Małopolska (about PLN 160,000) and Kujawsko-Pomorskie and Silesia voivodships (about PLN 150,000 each) won the most funds. The competition was so popular with local communities that even the last of the ideas that won funding received more than 15,000 votes. More than 400 initiatives supported locally, among others by NGOs and owners of small format stores, fought for 100 Eurocash grants.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

Customers of more than 400 small-format stores participating in the Eurocash Group's “Local Heroes” grant competition have already spent more than PLN 7 million on purchases to support their communities in raising funds for the implementation of social initiatives. Every day, dozens of people in each of the stores, vying for grants, shop and register receipts to vote on selected projects.

Support for an initiative can be expressed not only through receipts, but also by clicking on the competition website. Nearly 1.7 million votes have already been cast. The main role in voting, however, is played by receipts. So far, almost 250 thousand have been registered. Each receipt, depending on the value of the purchases, gives 5 or 10 votes for the selected initiative. Customers of Lewiatan, Groszek, Delikatesy Centrum, abc, Euro Sklep, Gama, abc on wheels and non-affiliated stores cooperating with Eurocash participate in the voting. These are not all stores of these chains, only those that support projects submitted to the contest “Local Heroes”. The full list of 403 stores from 250 locations involved in the campaign is available at www.herosiprzedsiebiorci.pl.

- The action “Local Heroes” shows how strong the connection of residents with local shops is. Customers see that the store owner cares about improving the conditions in their environment, so they support him with their purchases — says Marta Gampf, Marketing Director of the Eurocash Group. — Interestingly, such support is received not only by the owners of stationary stores. Customers of mobile abc stores on wheels also vote for their initiatives, which seem to have the most difficult conditions for building ties with customers. However, a strong identification of the person running the store with the place and the local community helps regardless of the idea of retail — adds.

Every day, customers send about 12 thousand receipts to be verified as part of the competition. As the voting deadline approaches, it is clear that these numbers are steadily increasing. “The involvement of customers and entrepreneurs is several times greater than we expected. We see groups being formed on social media to attract supporters and remind them to vote. The store owners themselves promote their participation in the action, encouraging customers to vote for the initiatives they support. They not only confirm their commitment to the life of the local community, but also attract customers to their stores. It's a bonus for being a local hero — says Marta Gampf.

The initiatives, which participate in the vote, serve the development of local communities in sports, culture, public space, charitable aid or ecology. Eurocash Group will award a maximum of 100 grants of up to PLN 10,000, up to PLN 50,000 and up to PLN 100,000. A total of PLN 1.5 million. The competition is organized on the occasion of the 100th anniversary of Poland regaining independence. Voting on the site www.herosiprzedsiebiorci.pl will last until October 14 this year, the results will be known by November 9 of this year.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

The Eurocash Academy of Skills received the ISO certificate “Implementation of training and development and consulting services through an educational platform, conferences, workshops, courses and seminars”. The ceremony of awarding the certificate took place in Łódź during the Congress of Entrepreneurs of Polish Trade — an event that brought together nearly 5 thousand entrepreneurs running small-format retail stores and their employees.

Eurocash Academy of Skills is the first comprehensive training program in Poland, aimed at owners and employees of stores associated in franchise and partner chains organized by the Eurocash Group: abc, Delikatesy Centrum, Euro Sklep, Gama, Groszek and Lewiatan. Among the advantages of having a certificate are, among others, the possibility of comparing the functioning of the Academy with other companies based on a common standard. It also increases credibility on the domestic and foreign training market and ensures the continuity of the educational organization's operation.

— For all ISO participants, it is associated with the certainty that the Eurocash Skills Academy is constantly improving its teaching processes, thus ensuring access to knowledge at the highest level — comments Agata Wrzecionowska-Dzierba, manager of the Eurocash Academy of Skills.

The award of the quality certificate was preceded by a detailed audit verifying the degree of implementation of the quality management system, which was carried out in the last days of August this year by DEKRA Certification Sp. z o.o. It was examined whether the Eurocash Academy of Skills meets the requirements of ISO 29990:2010. It is a standard dedicated exclusively to educational services for non-formal education and training. The auditors checked both the training programs offered by the Academy and the competence of the trainers conducting the classes. The verification process also covered how trainings, courses and workshops were organised.

— An important element of the audit was also the verification of the way in which the learners' knowledge was assessed and their level of satisfaction with the participation in the training. Participants' feedback is very important to us, because it allows us to improve the formulas of classes, as well as to define the needs of the courses. We strive to provide knowledge and support the development of our customers and their employees to exactly the extent they need. In this way, we also realize the mission and the overarching goal of the Eurocash Group, which is to ensure the competitiveness of Polish independent retail stores — adds Agata Wrzecionowska-Dzierba.

The certificate is awarded for three years — during this period every year the Eurocash Skills Academy will undergo an audit on the effectiveness of the quality management system.

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Eurocash Academy of Skills is the largest comprehensive educational and training program in Poland supporting Polish independent retail stores affiliated in franchise and partner networks organized by the Eurocash Group. Within its framework, store owners and employees have access to a modern e-learning platform, training workshops and conferences, thanks to which they can expand their knowledge in the field of work and management of a grocery store based on changing consumer trends.

In the period from September 2017 to August 2018 alone, a total of 18,000 store owners and employees took part in the Academy's conferences and workshops, and 14,000 people took advantage of the educational platform.

Among the initiatives of the Academy was the launch of postgraduate studies in the field of retail business management in cooperation with the Warsaw School of Commerce.

For more information: www.akademiaeurocash.com.pl

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

• The Eurocash Group has entered into a preliminary agreement to sell 100% of the shares of PayUp Polska, which manages a network of payment terminals installed in retail stores throughout the country.
• The buyer is Polskie ePayments — one of the leaders in the cashless payments market in Poland.
• In addition, the parties to the transaction concluded a long-term cooperation agreement, thereby ensuring the continuity of the provision of payment services to Eurocash Group Clients.

PayUp is currently more than 15.5 thousand POS terminals installed in stores affiliated to partner and franchise networks organized by the Eurocash Group and in other retail stores. Financial services such as payment card acceptance, phone top-up, cash back, bill payments or secure online payments are provided through the terminals.

“Thanks to the consistent development of PayUp in recent years, customers of small format stores cooperating with the Eurocash Group have gained access to modern financial services implemented through payment terminals. This happened much earlier than this type of service was introduced in large discount chains. Now PayUp will acquire a strong strategic partner with the know-how and resources necessary for further development. Eurocash Group will focus on core business and development of new projects supporting the competitiveness of independent trade in Poland — said Jacek Owczarek, Member of the Management Board and Chief Financial Officer of the Eurocash Group.

“Our aspiration is to build the position of a vice leader in the electronic payments market in Poland. The acquisition of PayUp strengthens our position on the podium and provides a strong foundation for growth. We are in a business where the scale of the business is crucial - both for the efficiency of the operation, as well as for the investment in the product and its innovations. We are particularly pleased with the fact that the acquisition of PayUp allowed us to acquire Eurocash as a strong, reliable business partner, with which in the coming years we will be able to support independent entrepreneurs running retail stores in Poland — told Jarosław Mikos, President of the Management Board of Polish ePayments.

“PayUp is the third company to join our group in 1.5 years. The previous ones are the terminal network Kolporter and the Internet payment provider Paylane. Integration processes in these two entities have been completed. We are already working on other interesting transactions. We are looking for companies that can give us an increase in scale, but also further product advantages. We expect to report our next acquisition within two quarters —told Marcin Drozdowski, Vice President of the Management Board of Polish ePayments.

“Today, the ability to pay with a card for every purchase, recharge the phone or pay the electricity or gas bill is standard, and the consumer expects new, convenient services that he could realize on the occasion of everyday purchases. The transaction of inclusion of PayUp in Polish ePayments will enable further development of services provided through POS terminals installed in our customers' stores — said Piotr Kokoszczyński, General Director of PayUp Polska S.A.

The sale price of 100% of the Company's shares was set at PLN 110 million, and the final sale price may change, depending on the achievement of the agreed financial parameters by the Company.

In 2017, PayUp Polska's unit revenue amounted to over PLN 440 million, and EBITDA (operating result plus depreciation) reached PLN 5.8 million.

The finalization of the contract is subject, inter alia, to obtaining the consent of the President of the Office for Competition and Consumer Protection.

In addition, the parties to the transaction concluded a cooperation and exclusivity agreement for a period of 5 years. In this way, the continuity of the provision of financial services through POS terminals for Eurocash Group customers will be ensured.

The financial advisor of Eurocash was Trigon, while the legal advisor was SK&S Legal. The legal advisor of Polish ePayments was WKB Wierciński Kwieciński Baehr, who advised TS Partners in the PayUp investigation process.

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Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks organized and supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

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Company Polish ePayments specializes in the processing of non-cash payments and the provision of innovative services for business, providing support for payment transactions made using payment cards and the implementation of other services using POS terminals. Polish ePayments was established in 2010 by OpTeam's management team. Since 2016, the majority owner of Polish ePayments is Innova Capital, a private equity fund operating in Central Europe. OpTeam retained a minority stake in Polskie ePlatnosci.

The Congress of Polish Trade Entrepreneurs is taking place in the Atlas Arena in Łódź: more than 5 thousand owners and employees of franchise and partner stores organized by the Eurocash Group take part in the largest retail trade meeting in Poland.

On Tuesday, September 25, the third edition of the Congress of Entrepreneurs of Polish Trade will take place in Łódź. The event gathered five thousand people — Polish entrepreneurs, owners and employees of retail stores: abc, Delikatesy Centrum, Euro Sklep, Gama, Groszek and Lewiatan.

The task of the Eurocash Group, as a distributor and partner of independent trade in Poland, is to create opportunities for the owners of small-format retail stores to develop and compete on the market. We are talking not only about ensuring attractive prices for goods sold by manufacturers, but also about modern technologies used for store management and consumer relations, training opportunities or new commercial concepts — says Luis Amaral, President of the Eurocash Group. Independent retailers must constantly evolve and professionalize as consumer behavior has evolved over the years. The consumer benefits from technological innovations on a daily basis and also expects them from the store where they shop. Moreover — he expects that thanks to them the store's offer will be better suited to his needs. This is increasingly noticed by local entrepreneurs. And at the same time they know exactly what they are struggling with as they run their businesses on a daily basis. That is why it is so important to be able to exchange experiences and personally meet thousands of people from the independent trade sector in one place within the framework of the Congress of Entrepreneurs of Polish Trade organized every year — adds Luis Amaral.

The Congress of Entrepreneurs of Polish Trade is an initiative organized as part of the Eurocash Academy of Skills — the largest comprehensive educational program in Poland, which supports independent retail stores. As part of the Academy, store owners and employees have access to a modern e-learning platform, workshops and conferences, thanks to which they can expand their knowledge in the field of grocery store management or customer service based on changing consumer trends, use modern forms and methods of education and exchange experiences.

- Traditionally, on the day of the Congress of Entrepreneurs of Polish Trade, we solemnly inaugurate the new academic year of the Eurocash Academy of Skills. It is also an excellent opportunity to summarize the achievements of entrepreneurs so far. In the last academic year (2017/18), more than 18 thousand people took part in trainings, conferences and workshops. More than 14,000 store owners and employees have used the e-learning platform. We have also launched postgraduate studies at the SGH dedicated to business management in retail and today we can celebrate the graduation together with 75 graduates — says Katarzyna Kopaczewska, member of the board of the Eurocash Group.

For the participants of this year's edition of the Congress, a series of speeches and lectures were prepared with the participation of external experts, well-known personalities from the world of science and business. Prof. Henryk Mruk (Poznań University of Economics) will point out how our daily activities affect store customers. Effective motivation and energy stimulation will be taken care of by Jakub B. Bączek (mental coach of the national volleyball team Stephane Antigi — gold medalists of the 2014 World Championship). Succession is also a current topic for an increasing number of entrepreneurs — patron Małgorzata Rejmer will talk about how to transfer the business. Athlete and entrepreneur Rafał Sonik will share his experience in the field of effectively combining passion and business. Prof. Rafał Ohme will explain the rules that govern our emotions and reason. The issue of leadership will be addressed by speaker and mentor Robert Krool. Dr. Mateusz Grzesiak will talk about how to make motivation a lifestyle. The meeting will be hosted by well-known sports journalists and TV presenters Włodzimierz Szaranowicz and Przemysław Babiarz.

Independent small and medium-sized grocery stores remain the main force of Polish trade — they account for more than 40%[1] FMCG market in terms of sales. How to face the expansion of discount stores? How to compete in the fight for consumers? These and other questions are answered by the Eurocash Skills Academy 2018/2019 program.

[1] Source: Nielsen, July 2018, Increasingly.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

Knowledge of the local market, including demographic data, rankings of best-selling products and preview of competition newspapers, the fastest on the market, user “learning” goods search engine, smart shopping lists, information about TV campaigns of the largest FMCG manufacturers or the ability to order products directly from an interactive promotional newsletter — these are just some of the functionalities that will change the lives of Eurocash Distributive Customers Independent entrepreneurs running grocery stores throughout Poland. This will be possible thanks to the new eurocash.pl platform, in which the Eurocash Group has invested PLN 15 million.

— For Eurocash and the entire market, this is a turning point, from today the owner of a small-format store has more information about the market than the director of a large retail chain — says Luis Amaral, President of the Eurocash Group. This means that our next project has successfully passed the testing phase, fulfills its task and is a real support for store owners all over Poland. It lowers their operating costs and allows them to focus their efforts on the consumer. For years, we have consistently changed the face of Polish trade by investing in solutions, also in the area of new technologies, which are intended to facilitate the conduct of retail business by independent entrepreneurs - eurocash.pl is the best example of this — adds Luis Amaral.

Eurocash Distribution is the leader in eCommerce sales and development in the industry

Eurocash Distribution is part of the Eurocash Group responsible for active distribution. For years, it has consistently invested in eCommerce and offers its Customers much more than the delivery of goods. Eurocash Dystrybucja's electronic channels currently generate PLN 3 billion in turnover per year, which ensures their position as a leader in eCommerce sales in the industry.

From 24 September ECD customers can use eurocash.pl — an innovative and unique B2B platform in the entire industry. It contains functionalities that allow you to effectively manage the store and make the right business decisions. It is a very simple and intuitive tool that allows independent retailers to compete effectively with organized trade.

The eurocash.pl platform will be available in three versions: online, cloud and mobile. In the future, it is planned to make the tool available to customers of the other business units of the Eurocash Group.

— Independent retailers have to contend with increasingly strong discounters. Therefore, they rely heavily on distributors who not only provide a wide range and competitive prices for goods, but are also partners in business — says Tomasz Polański, CEO of Eurocash Distribution. Thanks to modern and unique technologies in the industry, we support the development of retailers, giving them the opportunity to sell better and have a stronger competitive position. Independent store management becomes more efficient than ever — adds Tomasz Polański.

eurocash.pl empowers independent retailers

eurocash.pl is much more than an electronic “ordering machine” — in addition to quick and convenient placing orders, the tool supports business management and development.

The most important functionalities of eurocash.pl are:

• Module “In Your Area” — access to the knowledge base on the local market, prepared with the use of own data and analyses, and of companies cooperating with Eurocash. Demographics, shopping habits, rankings of the best selling products or a preview of competitors' newspapers are information that support you in making the right purchasing decisions
• Smart, the fastest search engine on the market — “learns” the Customer, remembers and suggests the right passwords, ignores mistakes.
• Shopping lists — based on advanced algorithms, suggest the most frequently ordered products and remind you of those that have not been chosen for a long time.
• The Know More Section — access to information allowing to compete effectively on the market, including expert knowledge, news and market trends.
• Products in TV — information about television advertising campaigns planned by producers cooperating with Eurocash Dystrybucja, giving an opportunity to order promoted products in advance and take advantage of purchase opportunities.
• Access to the current purchase budget and insight into the individual discount system
• Filing and tracking of complaints in the 24/7 system
• Auctions — available in the mobile application integrated with the platform, allow you to bid on products at exceptional prices.

The dynamic development of the distribution segment has presented Eurocash Distribution with new technological challenges. More and more customers needed to be provided with a system that was both efficient and completely reliable. This was achieved through the use of the latest standards of micro-service programming (socket.io), responsible for individual processes and business operations. The platform allows, among others: real-time data analysis, secure data transfer, document sharing or data separation.

Extra? , much appreciated? by users feature? eurocash.pl is a multichannel communication. The system uses such communication methods as “push” notifications (sent by mobile and web application), chat, SMS and e-mail. Thanks to this, important information reaches customers without delay, regardless of whether they are online at the moment.

The apps have been designed completely from the beginning. The latest trends and user experience (UX) standards are used - “Progressive Web Apps”, “Weather and mood apps”, “Minimalism”. The latest eurocach.pl solution is fully integrated with used ERP and data analysis systems - SAP/SAP HANA/SAP Hybris Marketing.

— The eurocash.pl platform is the sum of our knowledge, experience and customer needs, which we know from regular surveys. We know that entrepreneurs are open to new technologies — says Andrzej Szalowski, Marketing Director of Eurocash Dystrybucja. Thanks to investments in digital, they can make the right business decisions, save time and benefit from mobility. For example: all you need is a smartphone and a scan of the product from the shelf to quickly order the goods.— adds Andrzej Szalowski.

Innovations from Eurocash Distribution

Eurocash Dystrybucja has been consistently investing in the development of electronic tools for several years, providing customers with convenient, intuitive solutions that are not offered by any of the competing distributors. In June 2017, the first mobile application supporting store management was launched on the market, and less than a year earlier the My Eurocash portal, where you can find information about market trends and expert advice. With the launch of the eurocash.pl platform, my Eurocash becomes part of it by creating the Know More section.

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Eurocash Dystrybucja belongs to the Eurocash Group, the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by the Eurocash Group bring together almost 15 thousand independent stores operating under such brands as: abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

Eurocash Dystrybucja offers about 11 thousand products. The unit cooperates with nearly 600 suppliers, servicing nearly 20,000 stores annually.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

More than 400 small-format retail stores from 250 towns entered the competition for PLN 1.5 million in grants for the development of local communities and assistance to people working for their immediate environment. The project entitled “Local Heroes — 100 Entrepreneurs' Initiatives for the 100th Anniversary of Independence” was prepared by the Eurocash Group on the occasion of the 100th anniversary of Poland's independence. Previous studies have shown that small-format shops are, especially in smaller towns, an important point of life for local communities. This is also confirmed by the progress of the Eurocash project. Every day, more than a dozen customers in each of the stores that participate in the “Local Heroes” shop and at the same time increase the chance of their community to win a grant.

- “Small, local NGOs in Poland have energy and ideas, but they lack funds for action, so they are happy to obtain them through simple and unbureaucratic competitions” says Łucja Krzyżanowska, member of the board of the Foundation for Social Research and Innovation “Stocznia”, patron of the substantive competition “Local Heroes”.

For what purposes is money sought at the local level? More than half of the 403 initiatives that participate in the vote are intended to serve adults, and the rest to young people and children. The most popular area of local social activity is sport; among others, the organization of competitions and trainings, the purchase of equipment and the improvement of conditions for sports. In second place was the development of common space, i.e. construction and retrofitting of playgrounds, outdoor gyms, bicycle routes, shelters for integration meetings. Culture is also an important area for local communities, where grants are competing, among others, ideas for popularizing book reading, equipping cultural centers, supporting amateur orchestras, theatres and dance groups. Slightly fewer initiatives are intended to help, e.g. support for people with disabilities, improving conditions for rehabilitation and activation of seniors. The least reported ideas have to do with ecology; e.g. protecting bees and hedgehogs, helping homeless dogs and cats, planting flowers, shrubs and trees in the immediate vicinity. Formally, every initiative has an equal chance of winning a Eurocash grant.

Only one in seven initiatives was reported to the “Local Heroes” by social workers from provincial cities. Most ideas come from Warsaw — 21, Gdansk — 12 and Wroclaw — 6. Activists from 4 provincial cities (Szczecin, Bydgoszcz, Kielce and Rzeszów) did not submit any initiative to the competition. As many as 85% of the ideas submitted to “Local Heroes” were born in smaller county towns, municipalities and villages.

“The entries for the competition confirm that social life in smaller towns and villages most often revolves around municipal centers of community centers, sports clubs, schools, kindergartens, libraries, volunteer fire brigades and shops. It can be seen that these are the most important places of local activity, so they sometimes have to support and complement the activities of NGOs. They perform much broader functions than those that follow from their name.” — says Lucja Krzyżanowska. “Competitions such as “Local Heroes” give socially engaged people experience in carrying out projects; filling out applications, accounting, promoting. They allow them to gain courage in seeking funds from external sources, help promote themselves or refine their ideas” — adds.

The social activists and small-format store owners behind the applications managed to engage thousands of people in a short time to fight for votes. In just three weeks, customers of 403 different small-format stores supporting local initiatives registered more than 140,000 receipts. Depending on the value of purchases, they can be converted into 5 or 10 votes cast for the selected project. This means that every day, an average of 16-17 customers shop in their store under the banner, for example, Leviathan, Delicatesów Centrum, Groszku or abc, and at the same time think about using the receipt to help get a grant and change something in their environment. In addition to receipts, all submitted projects have already collected almost 760,000 votes cast per click.

Number of applications for “Local Heroes” by voivodship:

1. Lesser Poland — 46
2. Mazowieckie — 44
3. Lower Silesia — 39
4. Opole County — 31
   Pomerania — 31
5. Podkarpackie — 30
6. Greater Poland — 27
7. Lublin Region — 26

Silesia — 26

10. Lodz — 22
11. Lubuskie — 19
12. Kuyavian-Pomeranian Voivodeship — 14

Podlaskie — 14

Warmian-Masurian Voivodeship — 14

15. Świętokrzyskie — 10

West Pomerania — 10

The most, because as many as 240 initiatives are fighting for co-financing up to PLN 10,000, which means that for one grant in the competition there are almost 3 applicants. It will be a little more difficult to get support up to PLN 50,000, because there, on average, 13 initiatives will fight for each of the 10 grants. As many as 35 projects compete for one financial aid of up to PLN 100,000.

— “Promoting local engagement is the basis of our responsible approach to business” — says Marta Gampf, Marketing Director of the Eurocash Group. — “By supporting owners of small format stores throughout Poland, we contribute to the development of regions and local communities. The “Local Heroes” project is a prime example of this. When we hand over new retail concepts, educational projects or technologies to support the operation of the store, we must be sure that they will be a real support for them and strengthen their position in the market. We had a similar goal when we worked on the concept of “Local Heroes”. Participation in the action was to strengthen the relations of the entrepreneurs cooperating with us among their consumers, in the territory of their small homelands. The scale of applications and the number of receipts show that this goal has been achieved. The project resulted in an increase in the recognition of entrepreneurs in the area, improvement of image and sales” — adds Marta Gampf.

Voting on the site www.herosiprzedsiebiorci.pl will last until October 14 this year, the results will be known by November 9 of this year.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together more than 14 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

If the ranking of vodka producers depended solely on the value of sales of individual vodkas in Polish small stores, the Roust group would definitely win, ahead of Stock and Marie Brizard. However, the Eurocash Group in cooperation with the Polish Chamber of Commerce decided to compile a ranking of the largest vodka producers due to their distribution, pricing and product strategies applied to small-format stores. They still have the largest share of vodka sales in Poland. So who treats the owners of small stores and their customers the most fairly?

Once again, the best marks for equal treatment of different types of stores in the “Equal in Business” ranking were given to producers specializing in gift vodkas: Lithuanian Stumbras and Polish Dębowa Polska. Their assortment usually has similar prices in different types of stores. Also on the podium stood the vice-leader of vodka sales in Poland - Stock, known for such brands as “Żołdkowa” and “Stock”. This time, just behind the leading three was the Roust group, the largest vodka producer in Poland, offering, among others, “Żubrówka”, “Bolsa” and “Absolwenta”. Stock and Roust apply the concept of “perfect store” in a large number of independent retail stores, i.e. the ideal store in terms of attractiveness of the offer and level of sales. It can be seen that the solution created for small-format trade, including through close cooperation of sales departments with stores, brings good results. The smallest of the 10 largest vodka producers, Grupa AWW (Wiesław Wawrzyniak) came close to the top, and Polmos Bielsko-Biała fell out of it. Despite this, in addition to “Stumbras”, it was “Żytnia” produced in Bielsko-Biała that received the best ratings for maintaining a comparable price in different types of stores. In products dedicated to small-area stores, the best is the company Diageo (“Smirnoff”). Only ninth in this area is Pernod Ricard (“Wyborowa”, “Absolut”, “Luxurious”), and the tenth is Brown-Forman (“Finland”).

The final result in the “Equal in Business” ranking depends on how the manufacturer will be evaluated in terms of prices used, distribution, market share, contribution to sales growth and dedicated products. Each of these areas has an appropriate weight in the final result: price 20%, distribution 25%, market share 20%, contribution to growth 25% and dedicated products 10%. The number of points that the manufacturer receives in the rating is the weighted average of the results of each of these indicators.

- We distinguish strategies that assume equal treatment of different distribution channels. Vodka is one of the main products purchased in small-format stores, so it should be in the interests of manufacturers to approximate the prices offered in discount stores or supermarkets and in independent trade — says Jacek Owczarek, member of the board of the Eurocash Group.

The results of the ranking of vodka producers due to their strategies applied to small format stores:

1. TRUNK 84
2. OAK POLAND 78
3. LAGER 76
4. ROUTER 64
5. WIESLAW WAWRZYNIAK 61
6. DIAGEO 56
7. POLMOS BIELSKO-BIAŁA 51
8. MARIE BRIZARD 38
9. PERNOD RICARD 27
10. BROWN-FORM 18

The more points, the more balanced the strategy.

Comparison of this year's edition of the ranking with last year's shows that the most important manufacturers are unlikely to change their approach to the distribution market. Polmos Bielsko-Biała recorded the biggest change in the ranking to the detriment of customers of small stores, which fell from 4th to 7th place. At the bottom of the table are consistently other significant producers on the Polish market: Marie Brizard, Pernod Ricard and Brown-Forman.

- It can be seen that both large and smaller players can take care of sustainable relationships with retailers. This is very important, since the share of small-format stores in the sale of strong spirits is high, so they may be the most affected by the drop in sales that we are seeing now. The opportunity for them is to have a full, and not just basic, offer from leading manufacturers. We appreciate those manufacturers who already provide such an offer in the stores of independent retailers — says Waldemar Nowakowski, President of the Polish Chamber of Commerce.

The “Equal in Business” ranking was prepared by Eurocash Group analysts based on data held by the research agency Nielsen for the period from August 2017 to July 2018. It is a joint initiative of the Eurocash Group, the leader in the wholesale distribution of FMCG products in Poland, and the Polish Chamber of Commerce, the largest retail and services representative in our country.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

Wholesale segment on the path of growth and efficiency improvement. Retail under the sign of acquisition and integration of acquired stores and investment in new projects

• The Eurocash Group's revenues in the first half of 2018 reached nearly PLN 10.8 billion, which represents an increase of almost 7% compared to the same period in 2017. The Group's organic growth (excluding the Mila chain of stores acquired in the second quarter) amounted to more than 5%.
• The Group has recorded very good results in the wholesale segment. Sales of this segment increased by more than 5% y/y to PLN 8.6 billion, and EBITDA, i.e. operating profit plus depreciation, exceeded PLN 160 million and was 13% higher than a year ago.
• Sales of the retail segment increased in the first six months of this year by more than 7% to nearly PLN 1.8 billion. The EBITDA of this segment (in the first half of 2018 amounted to PLN 53.5 million) is influenced by the integration and remodeling and renovation of EKO stores. After the first half of this year, 149 EKO stores operated under the Delikatesy Centrum brand, and three started operating under the Lewiatan brand.
• The fresh products delivery project developed by Eurocash, which is key to strengthening the competitive position of retail stores, brought in over PLN 300 million in revenue in the first half of this year and was close to reaching the break-even point in the second quarter — much faster than expected.
• Normalized EBITDA (excluding one-time costs) for the entire Eurocash Group in the first half of 2018 amounted to nearly PLN 160 million compared to less than PLN 158 million a year earlier.
• Normalized consolidated net profit in the first half of this year amounted to PLN 21 million compared to PLN 38 million a year ago. The lower result was mainly related to an increase in depreciation and financial costs.
• In the first half of this year, the Eurocash Group recorded strong positive cash flows from operating activities in the amount of PLN 186 million. Despite the payment of dividends and expenses for the acquisition of the Mila network (total PLN 450 million), the net debt of the Eurocash Group at the end of June 2018 was at a safe level (1.9 x 12-month EBITDA).

— In wholesale, which remains the leading segment of the Eurocash Group's business, we continue to improve operational efficiency, which translates into both growing sales and an increase in EBITDA. In the second quarter, like-for-like sales at our Cash & Carry wholesalers grew by 2.7%, which is the best result of this format in more than four years and confirms the effectiveness of the restructuring carried out last year. — indicated Jacek Owczarek, Member of the Management Board and Chief Financial Officer of the Eurocash Group.

The very good results of the wholesale segment in the first half of this year also contributed to a strong 10% increase in sales in the active distribution format (Eurocash Dystrybucja), which includes deliveries to customers associated in the franchise and partner chains Lewiatan, Euro Sklep, Groszek and PSD (Gama), among others.

-- In the retail segment, an important event in the second quarter of this year was the finalization of the purchase of 187 Mila stores. This acquisition added more than PLN 120 million in sales to the segment's total revenues — in the first half of the year they reached almost PLN 1.8 billion. Taking into account the revenues of the Mila chain since the beginning of the year, the pro forma sales of the retail segment amounted to almost PLN 2.4 billion, which is 43% more than a year earlier — said Jacek Owczarek. — The completion of the purchase of the Mila chain and the planned acquisition of shares in Partner, which operates 26 Lewiatan stores, are the next stages of our consistently implemented strategy aimed at strengthening the market position of thousands of independent entrepreneurs operating retail stores in Poland. Thanks to our own facilities, we can more efficiently implement innovative solutions, increase efficiency in the field of logistics, marketing, as well as obtain purchasing conditions from suppliers that will improve the competitiveness of our customers against discount stores added a member of the board.

In the retail segment, Eurocash also continued to integrate the EKO network, acquired at the beginning of 2017. After the first half of this year, 149 EKO stores operated under the Delikatesy Centrum brand and three under the Lewiatan brand.

— The change of the sign is accompanied by the remodeling and renovation of the stores, which is associated with their temporary closure for the duration of the renovation, as well as the sale of products and subsequent promotional activities. In the short term, this is reflected in the profitability of the segment. Thanks to the renovation, however, local customers have the opportunity to shop in much more convenient conditions and, above all, have access to a much more advantageous offer. Already today we can see that stores, after changing the sign, record better sales results than those that have not yet undergone renovation — said Eurocash's chief financial officer.

In addition, the Projects segment has a negative impact on the current profitability of the Eurocash Group. It includes investments in the development of innovative retail formats such as Big Ben (liquor stores), abc on wheels (mobile grocery stores) and Kontigo (cosmetics stores), as well as the development of the distribution of high-quality fresh products.

— Although Projects charge the EBITDA result, we look at this item not as an expense, but as an investment. It does not matter that, from an accounting point of view, they appear in the income statement instead of in the statement of cash flows from investment activities. The projects strengthen the competitiveness of independent Polish entrepreneurs. Our clients are often unable to finance such investments on their own, so we believe it is our role to assume this responsibility. Over time, the projects begin to benefit not only the owners of independent stores, but also us. In the second quarter, the fresh goods supply project was close to reaching breakeven. Much earlier than our original expectations — emphasized Jacek Owczarek.

After a period of testing, the Eurocash Group decided to make the Big Ben and Kontigo concepts available to independent entrepreneurs. These networks will be developed in a franchise and agency model.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together almost 15 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.

Summer is conducive to walks, especially with the little ones. Walking in the fresh air brings a number of benefits for our children. It oxygenates and stimulates the growth of the body, strengthens immunity and provides natural vitamin D, essential for the proper development of teeth and bones. Being outside, the child learns new things and gets to know the world around him. What is worth taking with you on a joint trip?

Proper hydration of the child's body is the basis. The right amount of fluids is especially important for the little ones, as they lose water faster than adults during physical activity. Regular fluid replenishment can prevent many health consequences, such as heat stroke, which is especially dangerous for toddlers under 1 year old.

Bottled water is one of the most purchased products in Poland, it can be bought practically in any grocery store. Unfortunately, when looking for our favorite brand, we will not always pay the same for it in every place we visit. Not everywhere you will find a full range of drinks from your favorite manufacturer.

On what basis can such a thesis be made? The Eurocash Group, in cooperation with the Polish Chamber of Commerce, the largest representative of retail trade and services in our country, has developed the next edition of the “Equal in Business” Ranking. In it, he assesses whether the strategies used by Polish bottled water producers do not diminish the importance of small-format stores.

The ranking compares the results of the sales value of the ten largest manufacturers. Each of them was awarded points in the highlighted areas (price, distribution, market share, contribution to growth and dedicated products). The individual areas were given an appropriate weight in the final result. As the final number of points, the manufacturer received a weighted average of the results of all listed indicators.

The more points, the more sustainable the strategy is pursued by the company. And so, the first place in this year's edition of the ranking was won by Nałęczów Zdrój, the producer of Cisowianka, available in all types of stores for about the same price. Jurajska and Muszynianka were also on the podium. Manufacturers who favor large-scale trade and discounts scored the least points in the ranking. This group includes such market giants as Danone (Żywiec Zdrój, Dobrowianka, Vitalinea, Evian waters) and Nestle (including Nałęczowianka, Mazowszanka, Perrier, Vittel).

When completing a walking trip, in addition to the necessary accessories (eg diapers, wet wipes for babies, light changing clothes, milk in a bottle or creams with UV filter), let's remember about water. It is worth reaching for the one whose manufacturers carry out sustainable strategies and do not favor large stores or discount stores.

Eurocash Group is the largest Polish company engaged in wholesale distribution of food products and marketing support for independent Polish entrepreneurs conducting retail activities. Franchise and partner networks supported by Eurocash bring together more than 14 thousand independent stores operating under brands such as abc, Groszek, Delikatesy Centrum, Lewiatan, Euro Sklep and Gama.