Dennree’s turnover reaches 270 million Euros

In the 33rd year after its creation in 1974, Germany’s  biggest wholefood wholesaler by far has achieved a turnover of 270 million Euros. In 2006, Dennree GmbH increased its wholesale turnover by 16 %.  This figure is higher than the average growth in turnover of the wholesalers in the National Association for Natural Foods, Manufacture and Trade (BNN) (13.8 %), although it represents a slight decrease compared with the 19.5 % recorded for 2005 (234 million Euros).

Picture: Dennree Organic Store in Cologne

The total turnover of the wholesale companies in BNN increased in 2006 to 653.4 million Euros. This means that Dennree’s contribution is more than 40 %. Dennree is convinced that the high quality of goods and  intensive cooperation with the growers’ associations has made a decisive contribution to growth, an example being the premium Königshofer brand for meat, sausage and eggs, with all products having  ‘Naturland’ or ‘Demeter’ certification. In particular, Dennree has expanded  the product groups frozen foods and confectionery in its total range of goods. Information provided by the company itself indicates that the exclusive brands Dennree, Gustoni and Königshofer account for over 10 % of total turnover.

The more than 30 new stores and the extensions to existing organic stores and supermarkets belonging to independent retail partners are a second important factor that has contributed to the rise in turnover of 36 million Euros and  the consolidation of the company’s position as market leader. Up to now, Dennree has worked hand in hand with more than 200 organic stores in the context of the ’More Space for Wholefoods’ project. “For each of our partners we find the optimal individual assistance,” says Maren Schimanski from the marketing department and she explains how Dennree encourages expansion by helping to find and analyse sites, negotiate and draw up leases, and assisting with finance and advice on stocking goods. As a subsidiary of Dennree, denn’s Biomarkt GmbH runs 15 organic supermarkets under its own management in Germany and Austria. Last year, one new store was opened.

A number of new stores are planned for the current year. By the beginning of May, new denn’s organic stores will open in Bonn, Wuppertal, Hanover, Wiesbaden and Salzburg, and more new stores are planned for the second half of  2007. Franchise arrangements are being tested currently at two locations (report to follow). The retail space in these stores is between 300 m² and 1000 m². Dennree is anticipating that more than 20 new independent organic supermarkets will open during 2007 incorporating the marketing concept of the organic stores.

The organic stores’ customer information, with an average print-run of over two million copies per distribution in Germany, has become an important means of advertising in Germany. More than 300 organic stores and organic supermarkets distribute the flyers every two weeks. The store card (BiomarktCard) (picture) that was introduced in 2006 is now operated by over 70 stores, and more than 130 stores use the organic store logo in addition to their own firm’s name and incorporate it in the design of the shop front. According to Dennree itself, the company supplies over 1600 independent organic stores and organic supermarkets in Germany, Austria, Luxemburg and south Tyrol /Italy.

The product range, that currently consists of around 9500 articles, is to be extended during this year and more storage space will be created. A new 4200 m² high-shelf warehouse costing 23 million Euros is under construction. The new facility will not only create increased storage but also meet the need for quicker turn-round of goods. The company also states that more regional products will be available. The company, with its headquarters and main storage facilities in Töpen in northern Bavaria and nine branches in  Germany and Austria, is well positioned. “Through our commitment to producers and manufacturers, we have consolidated our role as market leader in Austria.” Currently, Dennree has about 600 employees and a fleet of around 120 lorries. Peter Knopp, manager of the trade department at Dennree, considers the way the organic food market is developing to be a constant challenge. In his opinion, the specialist trade has to confront all aspects of competition in the form of the conventional food trade, drugstores and discounters, and he is confident it will succeed: “Then the customers will keep on shopping in organic stores.”

29.03.2007