More hair dryers, less TVs at Meelectronics

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In the 2022 fiscal year, none of the ten Migros cooperatives were on the red line. According to outgoing Migros boss Fabrice Zumbrunnen (53), the specialty markets area, which is also part of the cooperatives, was in red. Sales of specialist markets, which include Micasa, SportXX, Bike World, Do it + Garden, Meelectronics and Obi, fell 6.7 percent to CHF 1.612 billion. Migros announced this on Tuesday as the group’s profits fell to CHF 459 million.

Specialty markets are clearly a troubled child. “There are a lot of unanswered questions in the non-food constant space,” says Zumbrunnen.

In the case of Meelectronics, a solution is currently being worked on. Superficially, this means: the product line will be adjusted, the number of locations will be reduced, the sales format will be reduced – but the brand will remain. “We want to focus on specific product categories,” says Zumbrunnen. While the focus will be on so-called “white goods” such as kitchen appliances, vacuum cleaners or washing machines, “brown goods”, i.e. consumer electronics, will likely disappear entirely from the online commerce of Migros subsidiary Digitec-Galaxus. It is the leader in Switzerland. Hairdryer instead of TV, so to speak.

Fewer branches, lower rental costs

However, there is another reason why Migros turned the branch concept upside down. The product range of the Migros Cooperatives Federation (MGB) is limited to a certain size; If cooperatives run larger outlets, they have to fill them in other “formats” themselves. As many Migros supermarkets are very large, the integration of independent Meelectronics branches solves two problems for cooperatives: the rental costs of individual branches are reduced and the space in existing supermarkets is better used.

Currently, there are 109 Melectronics locations, 64 of which are individual branches. The first branches have already been closed, for example in Zurich-Oerlikon, pilot branches under the new concept do not yet exist. “There are no layoff plans,” said Migros spokesperson Marcel Schlatter. 1,700 open positions were announced in Migros Group. “So there are definitely follow-up solutions within the group for any affected employee,” Schlatter says.

How high the potential for cost savings is in Metelectronics cannot yet be measured. Cooperatives are currently deciding how to proceed. This takes some time. Completion of the conversion project at Meelectronics is not expected to be completed until 2025. Things will probably move faster in a supermarket AG, where Migros supermarkets will be standardized across the country. But this is a project in itself and is still in the review phase.

Source :Blick