This year, PENNY's five annual conferences were held under the motto: "PENNY on the way to 1! Together into our future." In the spirit of #teampenny, Lionel Souque, CEO of the REWE Group, the PENNY managing directors and the PENNY management highlighted the very good development in the past year. PENNY achieved a record turnover of 9.5 billion euros - an increase of almost nine per cent. There are currently 2,123 PENNY stores in Germany.
Lionel Souque, CEO of the REWE Group, thanked the participants of the annual conference: "PENNY developed very well last year in a difficult environment. We are not only pleased about a new sales record, we were also able to increase earnings once again. PENNY and its approximately 30,000 employees make an important and indispensable contribution to the development of the entire REWE Group. My sincere thanks for this."
Stefan Görgens, COO of PENNY, was happy to echo this sentiment. In his speech, he emphasised that PENNY has increased its revenue by around 30 per cent since 2019. "This success is no coincidence. In addition to our dedicated employees, who give PENNY a face every day, we have invested heavily in order to position the stores in a pioneering way for the industry. Last year alone, we once again significantly increased our investments."
At the top of the agenda here is the modernisation of the market network. The roll-out of the innovative market hall concept, in which the product ranges are presented in U-shaped bays, is in full swing. This added clarity is reflected in the fact that the market hall stores are well above the average for other stores in customer surveys. Revenue is also increasing noticeably and consistently. This makes it all the more important that PENNY has already converted half of its stores and completed the project by 2028. This timing also applies to the smaller PENNY stores, for which a special small-space concept has been developed. By the end of this year alone, 50 PENNY stores will be converted to this concept. "With our small-space concept, we are consistently transferring the strengths of the Markthalle to smaller spaces. We have now also found a future-proof and trend-setting concept for our smaller stores," emphasises Stefan Görgens.
In addition to modernising its stores, PENNY is focusing on strengthening the attractiveness of its range and the associated strategic triad of value for money, own-brand strategy and PENNY app. Since the beginning of the year, PENNY has therefore been emphasising the slogan "For everything in good value: First to PENNY". A message that can now be found on every leaflet, for example. PENNY is thus emphasising its proximity to its customers and the realities of their lives. Another measure is the ongoing development of PENNY's own brands. "We are making it easier for our customers to find their way around," explains the COO. Overall, this strengthens the strategic importance of the own brands. The third component is the PENNY app. With the upcoming withdrawal from the Payback programme at the end of the year, there is a great opportunity to create a loyalty programme that is ideally tailored to PENNY and its customers, thus opening up completely new design options. To this end, the colour turquoise has already been introduced in the communication channels and stores as a strong visual recognition feature. This also creates clarity and facilitates orientation.
But in the end, all our endeavours will only be successful if our 30,000 employees continue to give PENNY a friendly face every day. For this reason, the topic of employee satisfaction plays an important role at PENNY. Here, PENNY has been able to achieve a constant score despite growing and ever new challenges and pressures. That's good, but it's not enough for Stefan Görgens: "The labour market is getting tighter and tighter. PENNY is taking targeted action to counteract this with programmes such as deputy store management, targeted recruitment from within the company, even higher-quality induction training and further development of the management culture." He continues: "The portfolio of issues and challenges is not getting any smaller. We at PENNY have a strong and clear answer to this. The PENNY team spirit. Across all levels and areas. #teampenny makes us stronger and more successful. That is why we are setting off into the future together," says Stefan Görgens, summarising the central message of all five annual conferences.
Hans-Jürgen Moog, REWE Group Management Board member responsible for merchandise and purchasing:
Hans-Jürgen Moog
Value for money starts with purchasing. Since coronavirus and the subsequent crises, completely new rules have been in place there: the annual talks have turned into talks throughout the year. We were challenged to the utmost to fulfil our claim of ensuring the best purchase prices, the best own and brand ranges and a stable supply of goods for PENNY.
Nevertheless, we have the impression that some suppliers have a completely different view of the market and customer needs. This is the only way to explain why some of these suppliers still have far too high expectations regarding the recommended retail prices of products and the respective brand loyalty of customers. We can see that customers are not prepared to pay any price for a well-known brand product. In 2023, PENNY once again actively fought against the further rise in inflation and - as a last resort - resorted to or accepted delivery stops. The inflation spiral is currently slowing down. We will continue to make our contribution to this.
Especially as many commodity prices are falling, from which PENNY customers must benefit as quickly as possible. Despite these "streaks of hope", the current year will continue to be characterised by tough negotiations. In addition to day-to-day business, the purchasing team is not losing sight of important developments for future product ranges. REWE Group is already very active in the area of FoodTech. We are seeing very exciting developments there that open up completely new perspectives for us when it comes to the transformation towards more food sustainability. After all, global population growth, climate change and more conscious eating already require bold answers today. The first products based on proteins from mushroom roots or Choviva, a cocoa-free sustainable chocolate substitute, are the first harbingers of this.
Christoph Eltze, REWE Group Management Board member responsible for Digital and Technology:
Christoph Eltze
Testing the shopping of tomorrow today also applies to the digitalisation and mechanisation of all processes. Like REWE Group, PENNY is taking a holistic approach to digital transformation. Only a synchronised and orchestrated approach will lead to lasting success. In the grocery trade of tomorrow, only those retailers who master digital and technology better than others will be successful. At this point, PENNY will benefit from REWE Group's pioneering role and the findings based on tests carried out by REWE colleagues. For example, with regard to delivery bots or autonomous stores, even if these applications are not currently at the top of the agenda. Nevertheless, a lot is happening here at PENNY. The Smarter Work project in the store forms the umbrella. As part of this project, all market processes, including the customer perspective, are being analysed. Initial results include store-specific space allocation, optimised store communication, queue management, as well as self-checkout and interactive integration of the PENNY app.
Telerik Shishmanov, REWE Group Management Board member responsible for Finance:
Telerik Shishmanov
Digitalisation, but also the constantly growing proportion of product groups that require refrigeration, such as convenience or to-go, are generally increasing the energy requirements of stores. The increasing air conditioning of the rooms in response to climate-related heatwaves is doing the rest. At the same time, REWE Group is pursuing the ambitious goal of being Net Zero by 2050. One pillar on this path is the consistent expansion of photovoltaics - the so-called REWE Group 1,000 Roofs Initiative - especially on the growing number of own properties, which already account for around 15 per cent of the stores. REWE Group acquired a stake in the Borkum Riffgrund 3 offshore wind farm years ago. The contractually secured amount of electricity covers almost 20 per cent of PENNY's electricity requirements. Our e-mobility campaign is certainly very exciting for our customers. By the end of this year, PENNY will have 230 locations with state-of-the-art charging points. Last year, there were only 82.
Daniela Büchel, REWE Group Management Board member responsible for Sustainability and HR:
Daniela Büchel
Our customers expect us to provide clear answers to the sustainability issues of our time. This also means that we as a company need to take a stand more than ever before. Our customers want to know what our values are. PENNY has therefore been boldly and aggressively positioning itself against intolerance, homophobia and prejudice for decades. The annual Christmas campaigns are very eye-catching in this respect. Here, PENNY focuses attention on groups that are otherwise marginalised in society or draws attention to social problems. However, this alone is not enough to be recognised as an attractive employer. The battle for the best and most motivated employees is in full swing. Demographic change alone means that the number of people in employment in Germany will fall by 20 per cent by 2035. Added to this are multiple crises that are putting a strain on employees. Finally, Gen Z is entering the labour market with its different value models. PENNY is taking targeted action to counteract the resulting trend towards increased fluctuation with programmes such as deputy store management, targeted replacement from within the company's own ranks, even higher-quality induction training and further development of the management culture.
