Food Lion 2007 Annual Report Download - page 16

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Generate Profi table
Sales Growth
Pursue Best-in-class
Execution Operate as a
Responsible Company
Openings
In 2007, Delhaize Group added 69 stores to its
network. Hannaford opened seven stores and Food
Lion added 15 stores. In Greece, Alfa-Beta added
11 stores in 2007 and in early 2008 announced
the acquisition of 33 Plus Hellas stores.
Delhaize Belgium added 27 stores, including 7
company-operated supermarkets and 9 Tom &
Co pet supply stores. Delhaize Belgium continued
to test the German market, with the opening of
a Delhaize supermarket in Köln, bringing the total
to four stores in Germany. At the end of 2007,
Delhaize Belgium ventured out into the north
of France with the opening of a Tom & Co pet
supply store.
In Indonesia, Delhaize Group opened 6 new stores
and ended 2007 with a network of 56 stores.
Mega Image in Romania continued its expansion
with 4 stores in 2007 and at year-end operated
22 stores.
In addition to growing the top line through sales-building initiatives in existing
stores, Delhaize Group focuses on accelerating its store remodeling and
network expansion programs.
Network Renewal
and Expansion
Renewals
Since 2003, Food Lion has taken a market based
approach to its store remodels. Food Lion each year
focuses the majority of its remodeling efforts on a
limited number of specifi c geographic markets. In
2007, two markets (comprised of over 100 stores
in total) were totally renewed: Myrtle Beach,
South Carolina and Norfolk, Virginia. The Norfolk
renewals included Food Lion, Bloom and Bottom
Dollar brands. All of the stores now offer greatly
enhanced fresh departments, improved checkout
and customer service areas, and new signage,
graphics and décor.
The impact of these renewals on revenues has
been signifi cant: in the fi rst year after the renewal,
revenues increase on average more than 5%
and continue to grow in years two and three. For
2008, Food Lion has selected four new markets for
renewal: Charlottesville and Richmond, Virginia;
Savannah, Georgia; and Wilmington, North
Carolina.
In Florida, Sweetbay completed its conversions
from the Kash n’ Karry brand, with 31 stores
converted in 2007. Throughout the conversion
process, Sweetbay has continued to reduce the
store investments while increasing the effectiveness
of the changes. Customers reacted positively to
the conversions and most of the converted stores
show major sales uplifts.
Also in 2007, Delhaize Belgium continued the
conversion of 20 Cash Fresh stores, acquired in
2005, to Delhaize banners. The remaining Cash
Fresh stores will be converted by the end of the
the third quarter of 2008.
A portion of Alfa-Beta’s impressive revenue growth
over the past years is the result of the company’s
store renewal program. Alfa-Beta stores are
increasingly recognized for their state-of-the-art
design and store layout and are considered to be
some of the most modern facilities in Greece.
DELHAIZE GROUP / ANNUAL REPORT 2007
14