As of: February 20, 2024, 11:24 a.m
By: Julia Hanigk
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A traditional non-food discounter has to close numerous branches.
The locations in the Frankfurt area are particularly affected.
Kassel – Economic slowdown and high inflation are currently weighing on the retail industry.
Discounters and supermarkets are repeatedly forced to close branches.
Now it's hitting the next German discounter: The non-food chain Kodi is closing numerous branches and repositioning itself.
Numerous Kodi branches are closing – customers in the Frankfurt area are particularly affected
As a non-food discounter, Kodi offers a variety of products for everyday life.
The range includes items from the household, drugstore, decoration, DIY, electrical, textile and some food sectors.
As the
Grocery Newspaper
reports, the family business now has to close some branches.
The Frankfurt area is particularly affected.
Some branches were apparently opened there during the corona pandemic and were no longer profitable due to high rents.
However, an insider told the newspaper that the discounter did not want to withdraw from the Rhine-Main area.
The majority of the branches are currently located in North Rhine-Westphalia.
The “Kodi” chain has to close many branches.
© Michael Gstettenbauer/IMAGO
Personnel realignment and product range changes at Kodi
According to the report, in order to overcome financial challenges, the company is also creating the position of sales manager.
The discounter relies on Cathleen Clasen.
She was previously a manager at the competing discounter Tedi.
Christian Müller also supports him as a consultant, it said.
But there are also said to be changes to Kodi's product range that will directly affect consumers.
The discounter recently offered around 3,500 items - that should be reduced.
Imported items should also be increasingly offered.
Upcoming financial challenges predicted as early as December 2023
A restructuring of Kodi was announced as early as December 2023.
Non-food discounters like Kodi are facing numerous challenges due to inflation, minimum wage increases and increased personnel costs, reported the
dpa
.
The traditional discounter was also told at the end of the year that closures were possible.
At that time, Kodi ruled out major staff cuts at headquarters.
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Energy costs and rent increases increased the pressure on discounters because the companies would pay so-called index rents.
This means that their payments are linked to sales development - and these have developed positively in recent years.
Frank Liebold, Country Manager Germany at the international credit insurer Atradius, explained: “Since companies cannot pass on the cost increases to their customers one-to-one, this is at the expense of profitability.”
Symbolic image: Numerous branches of a well-known German discounter have to close.
© Karl Heinz Spremberg/CHROMORANGE/IMAGO
Competitors make the market more difficult for non-food discounters like Kodi
The margins of non-food discounters fell from six to ten to just two to four percent in December 2023.
In addition, there are falling visitor numbers in the city centers, where the majority of the shops are.
“The discounters that don’t sell food are coming under increasing pressure.
And only the large market participants with the corresponding purchasing power will be able to survive in the market,” emphasized Liebold.
In addition, more and more international competitors such as Action and Pepco are entering the market, making business more difficult.
According to the
Grocery Newspaper
, Kodi is currently in negotiations with the northern German special items retailer Jawoll.
However, both companies have not yet officially commented on possible plans.
An
IPPEN.MEDIA query
to Kodi on Tuesday morning about the changes remained unanswered for the time
being (as of February 20th)
.
(jh)