Supersol Plans Huge Expansion of Discount Retailer

Supermarket chain Supersol plans to double the number of its Supersol Deal discount outlets. Supersol plans to convert 25 branches of the Clubmarket chain, which it recently bought out of bankruptcy proceedings, into Supersol Deals, bringing the total number of branches in that chain to 52.

Both private supermarket chains and suppliers have expressed concern about the planned expansion. Many private grocery store owners are worried they will have trouble competing with Supersol Deal's pricing policy.

When Supersol Deal was launched, CEO Effi Rosenheus said the food retailer was declaring war on the private sector and that it planned to offer the cheapest products on the market. Suppliers are concerned that Supersol will demand even larger discounts from them, since buying Clubmarket put its market share at 40 percent of bar-coded retail food sales - a market that accounts for 70 percent of private consumption.

Medium-sized suppliers are worried about profitability in the face of the Supersol demands, and similar ones from Blue Square likely to follow. Larger suppliers expressed concern that Supersol will again use its clout by taking products off shelves, as it has done in the past when it didn't reach commercial agreements with suppliers, such as with foodstuffs giant Strauss-Elite.

According to AC Nielsen statistics, Supersol Deal's 27 branches currently account for more than 40 percent of Supersol's sales (160 branches).

Supersol's spokesman stated in response that the retailer does not comment on strategic matters.