Jeronimo Martins SGPS SWOT and PESTLE Analysis

Strength

1. Highly diversified asset portfolio: Jerónimo Martins has assets in the food industry, mostly in the distribution sector, and it dominates the markets in Poland and Portugal. A network of grocery shops in Poland called Biedronka combines the best pricing on the market with a high-quality selection, a welcoming ambience within the store, and convenient locations. Hebe is a company that also does business in Poland that manages a substantial selection of goods at affordable costs as well as an in-store counselling service. The Group is a market leader in food distribution in Portugal. It runs the brands Pingo Doce and Recheio, which are leaders in their respective markets for supermarkets and cash & carry, respectively. Pingo Doce opened its first independent restaurant in 2021 and has dining facilities in 35 of its establishments. Recheio has a network of cash-and-carry stores, and it has enhanced its business model by adding a specialised food delivery service, supported by dedicated platforms, that mostly caters to HoReCa consumers. Ara does business in Bogota, the Caribbean Coast, and the Coffee-Growing Region of Colombia. It is a network of nearby grocery stores, many of which are located in residential areas, that caters to Colombian customers by providing quality products at the lowest possible prices and mixing competition with promotional possibilities in important product categories. The Group also runs two specialty chains, Hussel, a Specialized Retail chain that offers chocolates and confectionary, and Jerónimo Martins Restauraço e Serviços, which handles kiosks and coffee shops under the brand Jeronymo.

2. Leading food distribution chain in Portugal: Jeronimo Martins Group (JMG) operates majorly through two brands in Portugal, Pingo Doce and Recheio. JMG is the largest food distribution and consumer durables chain in Portugal. Pingo Doce operates in supermarkets segment with 441 stores and Recheio has 42 stores and platforms, both holding leadership positions in their segments. Pingo Dece also operates restaurants in 36 supermarkets with Take Away counters. The banner also has drugstore, clothing and shoe brands, namely, Bem-Ester, Code and Spot. Through Jeronimo Martin's Agro-Alimentor, food products derived from dairy products, livestock farming and aquaculture are provided. It leverages the group’s position in Portuguese market as both producer and supply chain service provider.

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Weakness

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Opportunity

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Threats

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Political

1. Sunday trading ban in Poland and its impact: Poland imposed Sunday Trading Bans in 2018. It restricted business on 2 monthly Sundays in 2018, 3 monthly Sundays in 2019 and all Sundays in 2020, except Sundays before festivals. It was done to provide quality family time to the working class of Poland, which has witnessed the highest working hours in Europe. It also promotes traditional mom and pop shops as they are exempted from the law along with shops in airport, railways stations and other emergency services. The law boosts usage of e-commerce, a direct threat to offline retail chain. The law puts a stress on store operaters to operate for longer hours on Fridays and Saturdays with heavy discounts to attract more buyers. JMG operates through the banner of Biedronka in food distribution retail and Hebe in health and beauty sector retail in Poland. Biedronka is outpacing the bank's affect by heavy discounts and promotional discounts through 'Everyday Low' campaigns but Hebe suffered due to heavier discounts in low margin products. To mitigate the effect, Hebe started the online retail channel somewhere mid 2019. The ban has pushed retail chains towards digital transformation and transformation in business model. The Government withdrew several of the exceptions outlined in this legislation as of February 2022, in particular by expanding the closure requirements to enterprises that operate as post offices and generate less than 40% of the total revenue for the postal service.

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Economic

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Social

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Technological

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Legal

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Environmental

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