Friday, March 7, 2008

I Can Get It for You Wholesale

Among my aunts and uncles there were several who came from the world of retail sales, part of a "nation of shopkeepers" for whom a favorite form of largesse was the announcement, "Why pay retail? I can get it for you wholesale." Nicolas Sarkozy has promised to attack the purchasing power problem by creating a revolution in French retailing. To do this, he intends to eliminate barriers to entry (Galland and Raffarin laws), encourage price competition, and introduce other changes designed to quicken the pace of evolution on the retail front. In effect, he's promising the nation, "I can get it for you wholesale."

Of course there will be costs. One study predicts that big retailers will cut 40,000 jobs, while "maxidiscomptes" will add 18,000. Anglophones may be bewildered by the wild nomenclature of French retailing. What is un hard discount (pronounced ahhred deece-coont) and what is un maxidiscompte, exactly? French Politics is here to answer these burning questions. On "hard discount," see here. And on maxidiscompte, here:

Businesses that predominantly sell foodstuffs (those whose turnover is made up of over 1/3 foodstuffs). Differentiated as:

- « Grandes surfaces » - large-scale stores

- «Hypermarkets» - selling space at least 2,500 m²;
- Supermarkets, selling space between 400 and 2,500 m²,
whose turnover is made up of over 2/3 foodstuffs;
- «Magasins populaires», just as large as supermarkets,
but whose turnover is made up of between 1/3 and 2/3 foodstuffs;

- «Petites surfaces» - stores with smaller selling space

- Supérettes, selling space between 120 and 400 m2;
- Grocery stores, selling space under 120 m2.

Grocery stores known as "Maxidiscompte" represent no special category. They can be identified by the typical signs and are to be found in the supérettes (under a third of them) and in the supermarkets. The Maxidiscomptes grocery stores are generally smaller than 1,000 m² and offer 600 to 1,200 articles.

8 comments:

kirkmc said...

While your definitions may correspond to some official benchmarks (size and all), the terms used commonly in France are grande surface (hardly anyone talks about hypermarchés any more), supermarché, and hard discount. I had never even heard the term "maxidscopmpte" before, in fact. Superettes are common in cities; they're the ones that stay open late and charge a premium for that reason. Magasin populaire; that's another one that isn't used, though it might be an industry term.

I have to say that I have never heard a French person say "grocery stores", unless it's just your list that's got a missing French term...

Kirk

Anonymous said...

Please comment on the effect the repeat might have on the small shops that make Paris so attractive.

MCG

Unknown said...

kirkmc,
I took the list from the Internet; grocery store is undoubtedly épicerie.

MCG,
People who shop in the small shops that make Paris so attractive are not likely to switch their allegiance to Auchan. Obviously one can't say what the ultimate equilibrium will be between small shops, discount chains, etc. Look at New York City, where there is no Galland Law and no Raffarin Law. Soho and the Upper East Side coexist with K-Mart and J&R Electronics and 47th St. Photo. In Boston we have Newbury St. and we have Sears and Best Buy. Fauchon and l'Algérien du coin will probably survive the arrival of hard discounters; convenience is a commodity, too, though one wonders if the world needs a Félix Potin on every corner, or a Dean & DeLuca's, Duane Reade's, and Starbuck's on every block.

Anonymous said...

My experience coincides with kirmc's, except that, in my region at least (SW France), epiceries (grocery stores) still exist, but mainly in small, isolated villages (where they are disappearing, to the dismay of local residents) and in large cities, where they serve people who don't have cars to drive to the grandes surfaces on the outskirts.

Anonymous said...

Arthur Goldhammer said:

"Look at New York City, where there is no Galland Law and no Raffarin Law. Soho and the Upper East Side coexist with K-Mart and J&R Electronics and 47th St. Photo."

It's both retail price competition and commercial rent inflation, and one seems to follow the other. I live on the Upper East Side, and the small shops are melting away, replaced by big chains. New York City would be enough to make me concerned about Paris even if I had not also heard that Paris lost 250 small shops and cafes last year.

Before the chains had visibly forced out the local shops here, everyone said it could never happen, there was too much variety in New York, and so on.

Anonymous said...

In my village in Provence many little shop keepers are being forced out by the "grandes surfaces" (which is all I hear them called now) -- LeClerc and Intermarché on the outskirts of town and Auchan in the city nearby. Still, the local merchants who offer something special other than proximity (an MOF fromagère, a couple of green grocers who work with local growers, a butcher whose produce is exceptional) have thriving businesses. I suspect the pattern will continue -- cheaper prices draw the working class and the bourgeoisie are still drawn to higher prices. (You have probably seen those recent studies.) Some communes in Provence that depend on tourism have banned "grandes surfaces" or at least pushed them to the edge of town.
In my neighborhood in Paris (the 7th) the quality shops with a huppé clientele do well but there's now a lot of churn in the hits of the moment, which in my street has meant that shoe shops have closed and baby boutiques have moved in.

Anonymous said...

For reasons perhaps having to do with the drain from the internet, the rise in commercial rents, and increased shopper mobility, ordinary neighborhood shops are fragile. Some municipalities in the United States, recognizing that the Gap and Starbucks do not attract tourists, have zoned local shopping districts to exclude chain stores. If I understand the way the National Main Streets program works in its 19 shopping areas in Boston, who gets to rent there is not entirely up for grabs, either.

To return to where we started, I would be surprised if removing price constraints had no effect on the small shops of Paris. I think those shops are one of the city's great amenities, and I am concerned.

Anonymous said...

The Village in NYC is completely transformed from interesting little shops to chains like the Gap. Sad.

My fear in France is the little mom & pop stores that provide quality service and stand by their products will disappear and leave us with the equivelent of Wall Mart. I can save money on appliances at LeClerc, etc. but if there's a problem, they don't want to know me.