Israeli retail chain Super-Pharm is opening a new chain called Daily, through which it will market freshly prepared food for the first time. The first branch, with 250 square meters, will be opened in the Ramat Gan Diamond Exchange area in the second quarter of 2020, and the second in the commercial part of the Azrieli Sarona Tower in Tel Aviv, sources inform "Globes."
The format of the new branches will differ from that of Super-Pharm. They will be half the current standard size of Super-Pharm branches, and will have a department in the front part of the store with freshly prepared food, such as salads, sandwiches, and pastries; a toiletries department; and a pharmacy. The cosmetics featured in regular Super-Pharm branches will not be sold in the new format.
Super-Pharm has not previously marketed freshly prepared food in its branches, because the law currently forbids marketing it in the premises of pharmaceutical products. In order to solve this problem, the new chain will separate the pharmacy from the rest of the store, with different entrances. In order to proceed with its plan, Super-Pharm will have to find new strategic locations, so that the pharmacy will attract customers and be an advantage.
This will be Super-Pharm's first subsidiary chain, after using a uniform format with a single message and one name for decades. The new chain's logo contain's Super-Pharm's usual logo next to the name "Daily." Behind this name lies Super-Pharm's idea of concentrating on food freshly prepared each day.
Super-Pharm is joining the growing on-the-go trend in the Israeli and global food markets in formats such as convenience stores and in the food market itself. Consumption of family consumer products, such as large bottles of beverages has been declining this year, with a switch to small bottles or personal snacks instead of large packages.
Super-Pharm, managed by CEO Nitzan Lavi, is the largest chain of its type in Israel, with 275 branches deployed nationwide and annual sales of NIS 5 billion. In the past two years, however, there have been changes in Super-Pharm's competitive environment, including in toiletries, after Shufersal, Israel's largest food retailer, acquired its own pharmacy chain operating on a format similar to Super-Pharm's, and Rami Levy acquired the Good Pharm chain.
Super-Pharm is also being affected by the open skies policy, which has increased the number of people traveling overseas and frequenting duty-free shops, where most of their purchases consist of cosmetics brands. The growth in ecommerce is also intensifying the competition in makeup and perfume. Super-Pharm has taken a number of measures achieve differentiation, including a shift to independent imports of cosmetics brands, such as South Korean brand Tonymoly and UK brand Pixi Beauty.
Super-Pharm is now turning to a category in which it has never before operated - freshly prepared food for immediate consumption. It will now compete with both retail competitors with which it hitherto competed in packaged products and with cafes and convenience stores. As of now, unlike in convenience stores, processed food products for home consumption, such as dairy products will not be sold in Super-Pharm's branches.
Published by Globes, Israel business news - en.globes.co.il - on December 11, 2019
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