E Leclerc (France)

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E Leclerc is France's biggest hypermarket brand by market share and neck and neck with arch-rival Carrefour as the country's biggest groceries supplier overall. The chain, which remains a co-operative, has built its reputation by battling against government monopolies and price controls in order to sell high quality foods at rock-bottom prices. It regularly courts media headlines to accuse suppliers or rivals (especially Carrefour) of over-pricing. Leclerc has moved into a huge a variety of additional markets ranging from funerals to travel services. It is also the country's foremost jeweller and a leading petrol retailer. The group has a less extensive network outside France than Carrefour, but has a significant presence in Poland and Portugal.

Selected Leclerc advertising

Advertising

Kantar (in Strategies) estimated advertising expenditure of E359m in France in 2014. Click here for agency account assignments from Adbrands.net.

Competitors

Aside from Carrefour, Leclerc's main competitors in the French grocery market are Intermarché (14.4% market share for 12 weeks to Jan 2017, according to Kantar Worldpanel), Groupe Casino (11.4%), Auchan (10.8%), Systeme U (10.3%) and Lidl (5.2%). See also Retail Sector index for other companies.

Contact

E Leclerc
52 rue Camille Desmoulins
92451 Issy-les-Moulineaux
France
Tel: 33 1 46 62 51 00

Brands & Activities

Leclerc has maintained its position as the leading hypermarket brand in France through a commitment to low prices and high profile political campaigning on consumer rights and environmental issues. The group has gradually extended its footprint beyond France, but that part of the business remains small compared to other French grocery retailers.

After months if not years of trailing behind Carrefour by a few fractions of a percent, Leclerc finally seized the lead in early 2017. By February 2017, Leclerc had an estimated 21.0% share of the French retail sector, according to Kantar Worldpanel, narrowly ahead of Carrefour at 20.7%. Leclerc was already the bigger player in hypermarkets.

One of Leclerc's biggest successes since 2011 has been the introduction of Leclerc Drive, whereby customers can order goods over the internet and collect them from designated collection points without having even to enter the shop. There are around 652 Centres Leclerc outlets in France, including more than 360 hypermarkets, selling a huge range of products from groceries to personal care goods, apparel, entertainment products, and consumer electronics. All but two outlets are franchised, licensed to independent operators but linked by Association des Centres Distributeurs Leclerc (ACDLec), the central non-profit wholesaling network controlled and run by the Leclerc family. Each retail outlet is a small business in itself. Licensees are each restricted to just two Leclerc hypermarkets. Founder Edouard Leclerc's family abide by the same rule; they also own only two outlets, on the site of the first shops in northern France.

As a condition of being part of "Le Mouvement Leclerc", all licensees are required to share out 25% of their pre-tax profits among employees and must restrict profit margins to 14%. Edouard Leclerc has always maintained that he is not interested in becoming rich, just in maintaining low prices for consumers. (Reportedly he once told an interviewer, "Christ took it upon himself to give out food to crowds. That is my mission as well.") In 2006 the group launched price comparison website QuiEstLeMoinsCher.com ("Who is the least expensive") specifically to demonstrate that it was cheaper than arch-rival Carrefour. The latter issued a law suit and the site was shut down for several months before relaunching in the Autumn. In 2008, Leclerc withdrew from membership of the FCD retail trade body, which it accused of bias towards larger hypermarkets and of ignoring the interests of smaller operators. The group also makes a point of publicly criticising brands which it feels price themselves too highly. Also in 2008, for example, it stopped stocking several household names including La Vache Qui Rit soft cheese, Pulco syrup, and two skin creams by L'Oreal and Beiersdorf, which it accused of "profiteering" by raising prices above inflation.

In addition, the group operates a number of specialist retail brands, usually sited within or alongside an existing Leclerc hypermarket. Le Manege a Bijoux has been France's leading mass-market jewellery retailer since the 1990s, with around 280 outlets nationally. Leclerc Voyages is a national chain of more than 180 travel agencies. A sports equipment brand, Sports et Loisirs Leclerc, opened in 2005, and the group also manages a network of separately branded jeans retail outlets, under the LJeans banner, selling third-party brands as well as private label products. The group has pushed aggressively into the pharmacy sector during 2006, as well as into home & garden products with its Brico-Jardi stores, and hire shops under the Loué chez E.Leclerc banner. In addition, Leclerc is a leading petrol retailer and service station operator with more than 550 outlets nationally. It even launched its own music download website, Musicetmoi.com, and the Leclerc Mobile wireless service in association with independent company Afone, which itself rents call volumes from SFR. Buying is handled by Galec, a central cooperative owned and run by representatives of the Leclerc retail network.

There are 87 Leclerc stores outside France. Key territories are Poland (with 45 stores) and Portugal (25 outlets), and there are also stores in Spain and Slovenia. Most are joint ventures with local partners. A twelve-year partnership in Italy with local retailer Conad was dissolved at the end of 2014. The 30 or so Leclerc-branded stores in that country reverted to Conad.

A separate network of almost 20 manufacturing businesses produces the group's huge selection of private label goods, ranging from meat, dairy and seafood to auto equipment, consumer electronics and financial services. Marque Repere is the umbrella name for a huge range of more than 2000 foods and other consumer goods, many of them private label, which are on permanent discount promotion through Leclerc stores. Tissaia is Leclerc's private label clothing brand. There are similar promotional discount schemes for higher price goods (Eco+) and regional French specialties (Nos Regions Ont Du Talent).

Financials

As a private concern Leclerc is notoriously cautious about releasing financials. However it disclosed group revenues of E44.3bn for 2015, including petrol sales; or E37bn excluding petrol. Operations in France, excluding petrol, contributed E35.6bn. The total contribution from specialist retail brands was E2.5bn.

Management

Edouard Leclerc retired from the business in 2005, although he maintained an interest until his death in 2012 at the age of 85. The central buying and coordination body is ACDLec chaired by his son Michel-Edouard Leclerc.

Marketers include Philippe Seligmann (director of group communications), Matthieu Couturier (media director), Olivia Pasquier-Dauguet (head of external communications), Emilie Marki (head of non-food marketing), Sigrid Pabst (CRM & customer loyalty director)

Background

Edouard Leclerc first earned his reputation as France's "discount king" when he opened two small food stores in his local region of Brittany, northern France, in 1949. He set about selling goods at the cheapest possible prices, and in 1953 clashed with local milk producers because he was undercutting rival retailers. Leclerc persuaded them not to boycott his shops by pointing out that he could sell more milk at low prices than his rivals could at their higher prices. Later he extended his range of products, developing low cost clothing labels Envog and Tissaia.

During the 1950s he expanded his network rapidly by franchising independent owner-operators to run their own stores, branded under the E Leclerc banner, but taking advantage of central bulk buying. In the mid-1960s, with a network of more than 300 shops in France, Leclerc opened its first supermarkets. However expansion was not without its problems. In 1969, a group of almost 100 outlets broke away to form a separate organisation, now Les Mousquetaires, the co-operative which runs arch-rival Intermarché and other chains. However, Leclerc's other stores also grew, gradually blossoming into hypermarkets during the 1980s. By the end of that decade, there were 460 Leclerc hypermarkets across France, selling furniture, clothing and hardware as well as food.

At the same time, Leclerc, now supported by his son Michel-Edouard, began a series of legal battles with the French government as he repeatedly targeted markets with pre-arranged price controls or state monopolies, which he then proceeded to break. Travel and holidays, the funeral industry, cosmetics, petrol and tobacco were among the many areas where Leclerc sought to undercut other retailers. "Leclerc Smashes Prices" became the call to arms in the group's advertising.

In the 1990s the organisation dipped its toe into the international market, testing two hypermarkets in Spain, and backing a similar co-op concept in the US, under the name Leedmark. However the US store proved a disaster and was eventually closed down in 1994. (The huge site was bought by Wal-Mart). Closer to home the retailer opened stores in Portugal and Poland. In 1998 Leclerc agreed strategic alliances with rival French retailer Systeme U to develop stores eastern Europe, and with Spain's leading purchasing group, Euromadi Iberica to extend its Spanish interests. In 2002 Leclerc agreed a similar joint venture with grocery group Conad to launch hypermarkets in Italy, 60%-controlled by Conad and 40% by Leclerc. However that partnership was dissolved in 2014.

Last full revision 4th April 2016


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