French hypermarket chain E. Leclerc rumoured to be moving into Senegal

Aug 31, 2018

E-Leclerc
Senegalese media has reported that French hypermarket chain E. Leclerc is set to move into Senegal. The same reports indicate that E. Leclerc has sought to buy an independent distributor based in Saly and looked at sites in Dakar and Thiès.

If E. Leclerc does enter Senegal, it poses several questions:

  • Why now? If E. Leclerc enters Senegal with its own stores, it will be the company’s first market in Africa. Senegal is a relatively small, highly competitive market. While attractive within the context of its size, it is not an obvious first choice for a French-based retailer.
  • What does it mean for Carrefour? E. Leclerc opening supermarkets would mean that Auchan, Casino and Super U were all in Senegal. Carrefour, through partner CFAO, is known to want to open stores in Senegal. The issue is that a hypermarket specialist like E. Leclerc is a further challenge for Carrefour, which has typically entered West Africa as the anchor tenant of CFAO malls.
  • Will it actually launch stores? It’s not totally clear that E. Leclerc would want to launch stores, rather than use Senegal as a destination for its own brand products. Reports are unclear on this point.
  • Could it enter with non-food only? E.Leclerc is a non-food specialist, as well as a grocery store operator. It owns opticians, pharmacies, toy stores, sports stores, DIY and garden stores, jewellers, pet stores, perfumeries and book stores under the E. Leclerc brand, co-located with its hypermarkets. It is not beyond comprehension for it to launch in Senegal with a non-food dominant offer.

This much is clear: if E. Leclerc does enter Senegal with supermarkets it will provide more disruption to the market, which is currently dominated by Auchan. Auchan entered Senegal in 2014 with its Atac banner. It since rebranded those stores as Auchan, acquired the Citydia network of stores in late 2017 and expanded its store network to 26 supermarkets. That network includes smaller neighbourhood stores as well as Senegal’s largest hypermarket, which opened in the city of Mbour in July 2018.

As Auchan has grown, it has faced a growing clamour of voices representing independent Senegalese traders, afraid that the French chain’s scale and buying power will force prices down and put many of them out of business. The entrance of another French supermarket chain, whether Carrefour (which faces similar opposition in Cameroon) or E. Leclerc, would raise the issue of foreign control of food distribution to the level of a national political debate.

At the moment, the rumours of E. Leclerc’s entry into Senegal are just that: rumours. The company has not issued a statement either way.

 

 

Loading...

Looking for more trends and insight on FMCG in Africa?

Join Trendtype's mailing list for news, events and more.

Thank you for joining us. Speak to a member of our team today on +44 333 567 9995

Looking for more trends and insight on FMCG in Africa?

Join Trendtype's mailing list for news, events and more.

Thank you for joining us. Speak to a member of our team today on +44 333 567 9995