Colruyt Group looks ahead: ‘Ready for the future’

Wednesday, June 8, 2022

A lot is happening today in society in general and in the retail landscape in particular. As mainly Belgian retailer and one of the largest private employers in our country, Colruyt Group makes sure, with the long term in mind, it is there every day with its 33.000 employees, all at the service of thousands of customers. Last year, Colruyt Group worked hard to centralise its activities around four solid pillars: food, health and well-being, non-food and energy. Sustainable entrepreneurship is central to this, in order to enable customers to make conscious choices. Overarching, the digital component, with amongst others Xtra, is being further developed and the "bricks" are not being lost sight of: the physical shops remain very important in the total offer of products and services to the customer. An overview of how Colruyt Group is ready for the coming decades.

Sustainable business to enable conscious consumption

In 2007, Colruyt Group saw the light of day as the umbrella and common ‘family name’ for a whole series of shop formulas such as Colruyt Lowest Prices, OKay, Dreamland and DATS 24. These brands all have their own first name, identity and market, and have this family name in common. Jef Colruyt, CEO Colruyt Group states: "Colruyt Group wants to make a meaningful and sustainable difference in the world with its various formulas, based on our positive attitude. We always want to be the reference, the best in our profession. We want to do this by offering simplicity to our customers, by making their lives easier, and we do this mainly by listening very carefully to our customers. In our shops themselves, through our own market research, through our customer service, and so on."

In this way, Colruyt Group has succeeded in creating added value across generations for years. Today, more than ever, the retail group wants to focus on creating sustainable added value for the customer, whose needs are constantly changing. Jef Colruyt: "What we undertake must therefore be socially relevant and offer an answer to what the customer asks, must be done with respect for people and the environment and the economic picture has to be right. In the long term. For us, these three elements are the key to sustainable business. For us, this does not stop at simply being a retailer, it goes much, much further.

Focus on specific subject areas

That is why a number of very specific areas of expertise have now been defined within the Colruyt Group organisation, with the ambition to continue to grow in the years to come, to build up further professional knowledge and to offer a sustainable offering. These areas are Food, Health, Non-food and Energy. Two specific umbrella channels were defined as the great common denominator between these fields: the physical part on the one hand - the "bricks": shops, distribution centres, pick-up points, central buildings, where Colruyt Group has built up a great deal of knowledge in the field of real estate over the years - and on the other a digital part that is filled in through further developments in the customer card and app Xtra. "The reason why we choose this specific landscape is because these elements all enable us to continue to serve customers and their families well throughout significant life moments. As an employer of almost 33,000 people, the Group has a strong local presence in our country and we know our customers very well. We are therefore convinced that we have chosen the right direction by dividing our activities into these areas: all in all, we can offer qualitative solutions for about 30% of the total Belgian family expenditure", says Jef Colruyt.

The pillars

1. Further focus on food retail and food production

Food retailing is and remains the basis of Colruyt Group. The retailer continues to do what it has been doing well for 90 years, in Belgium, Luxembourg and France. The existing, consistent story of food retailing continues to be built on. With strong formulas, efficient logistics and a strong local presence. Jo Willemyns, COO Food Retail and Marketing Services: "We continue to fight for the consumer's purchasing power - that is more relevant today than ever. As a specialist in the retail sector and as market leader, we use our years of knowledge and craftsmanship to ensure that price increases are kept under control as much as possible. We challenge suppliers in a constructive way and, together with them, look for alternatives. ​ This way, we can ultimately ensure that the customer receives a high-quality and affordable offer in our shops and online. An offer that optimally meets his/her needs, even in times of crisis. Colruyt Lowest Prices will always keep its lowest price promise".

Focus points for the coming years within the food retail will of course remain e-commerce (with Collect&Go), working further on a larger presence in the cities (where OKay Direct was already an interesting innovation) and on the further development of the professional channel (Cash & Carry with Colruyt Professional). Furthermore, regarding offer, there will be a further focus on category development in the shops themselves. Just think of the parapharmacy rayons in Colruyt Lowest Prices and OKay, the new bread furniture and investments in selling flowers in the shop. The recent participation in Foodbag can also be seen in this context. Willemyns: "We also want to grow further in the offer of meal boxes".

In addition, Colruyt Group remains an important local retailer-producer with Colruyt Group Fine Food. Here too, the focus is on further vertical integration with investments in, for example, a new production site for salad spreads, but also with expansions, such as the integration of the Roelandt bakery group. Stefan Goethaert, COO Fine Food, Business & Group Services: "We produce about one third of our turnover in own brand products ourselves. That makes us evolve more and more towards retailer-producer. We want to have a local presence, so we also produce locally. We have good reasons for doing so: we get a much better overview of the entire chain and therefore have an impact on costs and quality, we can focus on nutritional values, we can develop new products, and all this while paying attention to our ecological impact".

2. Establishing an ecosystem around Health and Wellbeing

As a retailer, Colruyt Group considers it an important responsibility to have a positive impact on the health of, not only, its own employees, but also of its customers and of society in general. The ultimate goal is to develop an ecosystem that step by step promotes a holistic approach to health.

Jef Colruyt explains: "We are going to work in a much more service-minded way, with a new focus on preventive and mental health: a healthy mind in a healthy body. We are tackling the whole picture, because health also includes sleep, exercise and mental health. At that intersection, we as Colruyt Group want to assume our social role and invest in health in the broader sense. NewPharma, JIMS and SmartWithFood, for example, are perfect levers for this. As a retailer with a large reach, we can make information relating to wellbeing and health more accessible to everyone. We feel we can take up responsibility here as we are as retailer the last link in the chain to the customer".

Colruyt Group can build on (its own) data, customer insights, digital knowledge and technology to improve its offer and services, as a lever to support customers in their quest for a balanced lifestyle. In practice, various initiatives have already been launched within the principle of "better prevention than cure". For example, SmartWithFood's "Hello Health" aims to reach some 25,000 employees of companies with a specific ‘Health Coach Platform’ by 2025, and an offer for individual customers is also being developed. JIMS' fitness clubs are a solution to that necessary and beneficial exercise, and smart refrigerators were recently installed there, with logistics provided by Solucious. "There are a lot of further synergies possible within this field, nutritional advice amongst others" says Jef Colruyt.

3. Strengthening formulas in non-food

Non-food remains an important pillar in the future story of Colruyt Group. This market is also in full evolution, also based on customers who want their needs to be met quickly. Colruyt Group's non-food brands (ZEB/The Fashion Society, Bike Republic, Dreamland, Dreambaby, MyComfort24, ...) are all major Belgian retailers that can be seen in a broader landscape as SMEs specialising in their field.

As a non-food business, it is important to be able to adapt quickly and move with the market, so that strength remains possible. Jef Colruyt: "We join forces within non-food to ensure that each ‘business’ can provide the best service to its specific target group of customers and that we can continue to build relationships with families. Formulas such as Dreamland and Dreambaby are working on services for specific communities, and Bike Republic - still in full expansion - is also focusing on customised services. Just think of their cooperation with Touring. We are convinced that there are still a lot of opportunities here, and to us, these formulas are also crucial in the total offer that we want to provide”.

4. Focus on green, renewable and above all usable energy

Colruyt Group continues to invest in sustainable energy with Virya Energy and DATS 24. The focus is on both energy production and guiding the end user through the transition to renewable energy. Colruyt Group has built up very wide expertise in this field over the last 25 years and can now call itself a reference in the field of renewable energy, both for business and private customers. Jef Colruyt adds: "Thanks to our history and experience, we are increasingly seeing that it is not just a question of generating green energy, but also of 'how do we bring it to the user, and is it really useful for that end user'. And there we are, of course, also looking at alternative fuels. As a retailer, we transport tons of goods every day; we have to get them to the shops, and preferably in the most sustainable way possible. Electric driving is certainly an option, but hydrogen will also be a possibility".

DATS 24 aims to find good combinations, innovative approaches with new technologies as a supplier of renewable Belgian electricity and gas. In addition, we are pioneering the use of these various possibilities, such as charging stations. The recent participation in Pluginvest is in line with this, as well as the recent opening of Belgium's largest semi-public charging station at the group's headquarters in Halle. The goal is to triple the number of charging points at Colruyt Group shops over the next 1.5 years. DATS 24 would then operate 1,000 charging points in the retail parks, allowing more and more customers to recharge while shopping. The number of hydrogen filling stations is also being expanded: one more opened in Wilrijk on 31 May 2022.

5. Xtra as a personal assistant

In the coming period, speed will be added to the continuation of the digital Xtra story, Colruyt Group's customer card and app. Jo Willemyns: "The Xtra app is ready to take the next maturity step, from 'discount app' to ‘Personal Shopping Assistant’". The new Xtra app is in full development, with a new technical platform and an open architecture that will make it easier to add the other apps that already exist within the group into one - again with the convenience for the customer in mind. Willemyns: "We have additional interesting features in the pipeline, including seamless pay function in cooperation with Digiteal, shopping lists 2.0, shopping circuit support, customised product information such as recognition of allergens, and a loyalty scheme to contribute to a better world".

Colruyt Group: ready for the future

In everything that Colruyt Group does as a whole, in all its fields of activity, the retail group aims to make life easier for its customers by means of relevant solutions (Simplify), to allow them to stand in their own power and take hold of some things themselves, and to make conscious choices (Empower), and smoothly in connection with others (Connect).

Jef Colruyt concludes: "That Simplify-Empower-Connect ambition, just like that sustainable enterprise, runs like a thread through everything we do. Digitalisation makes it possible to offer our customers the relevant information, knowledge and support at the right time. The investments we make, the partnerships we enter into and the initiatives we take are done for a good reason. We also do this in the most cost-efficient and sustainable way. In the coming years, we will continue to focus on synergies between the different areas of expertise and linking these to services for our customers. In our physical shops, where our accumulated knowledge of real estate allows us to know where we can best be present with which shop formulas, and digitally with Xtra. Always with a view to the long term. We are convinced that, with these choices, we are ready for whatever the future brings".