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Sat 9 Feb 2008 04:00 AM

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Modern thinking

Double-digit grocery sales growth and a 9% jump in 2007 has positioned Jordan as a market to watch.

Double-digit grocery sales growth and a 9% jump in 2007 has positioned Jordan as a market to watch.

Increased demand for and availability of imported and international foods has fuelled FMCG sales in Jordan, according to Planet Retail's new Grocery Retailing in Jordan report.

Safeway has announced it will open a hypermarket at Aqaba Special Economic Zone, a government sponsored project aimed at developing the area.

The surge of modern trade in the country has accelerated the market's growth as rising numbers of international chains chase the market's attractive demographics and untapped potential.

Carrefour has emerged as the biggest international retailer to invest in the country, however Kuwait's The Sultan Center (TSC) has made the most sizeable commitment to the country's retail sector with its engagement at Safeway.

TSC acquired a majority interest in the company in 2003 and introduced the Safeway X-press and Wholesale Centres in the market, to build upon Safeway's lucrative presence.

Spinneys recently announced its major investment program, and the company has confirmed that an agreement to open stores has been signed, however no timeframe has been given yet.

Carrefour and Safeway have selected strategic locations boasting high consumer traffic for openings, and a number of modern shopping malls are planned around the country, which have heightened the possibility of further hypermarkets as anchor stores.

Safeway has announced it will open a hypermarket at Aqaba Special Economic Zone Authority, a government sponsored project aimed at developing the area, and Carrefour is also expected to open more stores in an attempt to build a market leading position.

Safeway supermarkets are currently the leaders of the modern scene, with seven locations in Amman, Irbid, Zarqa, Aqaba and Mafraq. Owned by The Sultan Center, the full-service outlets offer delivery services and ongoing promotions, which have proved hugely popular with local shoppers.

The chain has a network of hypermarkets, supermarkets and convenience stores across the country, and occupies strategically important locations in major conglomeration zones and high traffic areas, including its outlet on the airport road and ring roads around the capital.

The company has recently refurbishment older stores and added new features such as sushi bars and other services.

C-Town is another of the leading supermarket chains, currently the second largest player with six stores surrounding and in the capital of Amman.

Carrefour occupies the number three ranking, following its first opening in December 2007.

There has been a rise in the number of independent supermarkets in urban centres, as shoppers shift their attention away from independent corner stores with limited product ranges and towards modern stores.

Long-term potential for manufacturing is considered to be strong, but the development of a manufacturing base is tipped to be slow. At present, most food products are imported, however a small number of international FMCG brands are establishing themselves due to changing lifestyles.

The private label sector is in its infancy. Safeway currently imports products from its Kuwaiti parent operations The Sultan Center, while Carrefour sources its labels from its operations in the Gulf and France.

The modern Jordan retail environment has welcomed promising developments over the past five years.

Safeway has expanded considerably by opening new stores and formats. Carrefour opened its first hypermarket in Amman's City Mall in December 2006, signalling the first international giant to enter the market.

The development was momentous, as it has paved the way for other modern retailers as the support structures have now been constructed. Jordan's retail sector is expected to follow similar trends to its neighbouring countries, such as Syria and Lebanon.

The trend has been to encourage forms of modern trade, investment into retail property and liberalising conditions for the importation of manufactured goods.

The establishment of the City Mall in Amman housing the Carrefour store paved the way for large shopping mall developments, to be followed by the Crystal Mall this year.

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