Mi, 27. Mrz 2024
Migros Group’s online subsidiary, Galaxus, faces tough decisions about its future in Germany, amidst intense competition and significant losses.
The Migros Group, Switzerland’s retail titan showcased growth, with its sales climbing to CHF 8.7 billion, marking a 1.5% increase.
This growth was significantly bolstered by the Galaxus Group, which enjoyed an 11.6% surge, alongside Denner’s 4.0% rise in sales.
However, Migrol experienced a downturn, with a 15.0% reduction in sales, attributed to falling volumes and oil prices.
During Migros’s annual media conference in Zurich, CEO Mario Irminger shed light on the mixed fortunes of the Galaxus Group, particularly its expansion efforts in Germany.
Despite nearly 12% growth according to Migros press release, with a third of this attributed to its operations in Germany, the online retail venture is grappling with substantial losses in the highly competitive German market.
Irminger highlighted the dominance of global competitors in Germany, which has necessitated significant investment by Galaxus to establish a foothold.
The future of Galaxus in Germany remains uncertain, with ongoing discussions about the extent of Migros’s involvement in the challenging market. CFO Isabelle Zimmermann, refrained from quantifying the German subsidiary’s losses.
As the online arm of the Migros Group, Galaxus’s performance is integral to the conglomerate’s retail strategy. The current scenario underscores the delicate balance between expansion and consolidation, especially in foreign markets fraught with competition.
So it seems while Migros is doing well, their online retail push into Germany, despite reaching growth targets may be on the chopping board. The highly competitive german market is proving greatly difficult for Galaxus to operate in.
©Keystone/SDA
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