Haredi boycott hits Blue Square market share

The market share of Blue Square narrowed from 23.2% in March to 21.8% in April.

Lower sales at the Blue Square Israel Ltd. (NYSE: BSI; TASE: BSI) Shefa Shuk supermarket chain is affecting the market share of the group as a whole. The Nielsen report for April 2008 shows the market share of rival Super-Sol Ltd. (TASE:SAE;Pink Sheets:SSLTF) gaining at the expense of Blue Square: Super-Sol's market share rose from 36.2% in March to 37.9% in April, while the market share of Blue Square narrowed from 23.2% to 21.8%.

The decline in Blue Square's market share in April coincides with the haredi (ultra-orthodox) boycott of its parent company, Alon Israel Oil Company Ltd. because another supermarket chain, AM:PM, operates on Saturday. Sales at Shefa Shuk stores located in haredi neighborhoods have fallen 30% since the boycott was launched.

However, an examination of the aggregate market share of the two supermarket chains shows an equal decline in January-April. Super-Sol's market share in this period fell to 36.5% from 37.5% in 2007, while Blue Square's market share fell to 23.1% from 23.7%.

At the same time, the aggregate market share of independent supermarket chains rose to 21.6% in January-April from 20.3% in 2007.

Published by Globes [online], Israel business news - www.globes-online.com - on May 22, 2008

© Copyright of Globes Publisher Itonut (1983) Ltd. 2008

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