Greece: Wholesalers build up Retail Chains/ Greece 1

The major routes through Athens are dominated by the smell of exhaust fumes and by noise. The Greek capital has about 4.5 million inhabitants, which is almost half of the whole population of Greece. At some distance from the bustle and racket, the specialist food shops of Green Farm and Green Post are to be found in the Marousi and Kifisias districts, pleasant locations in the north of Athens. What the two companies have in common is the fact that they were started by and are run by wholesalers.

Picture (can be enlargend by click): Green Farm in Athens

The number of specialist whole food shops with organic products constituting at least 80 % of their stock is estimated by experts to be about 200. Of these, 50-60 are certified organic, according to Alexandra Kiriazopoulou from the organic certification agency Dio. In addition, there are shops, mostly with fairly limited floor space, that keep a smaller proportion of organic products. About 80 of the 200 specialist shops are located in greater Athens. 'In the last two years in Greece, the market has grown by 35 % each year', Efthimis Tsibidis, managing director of Mediterranean Farm, is delighted to explain. This was, however, starting from a low level. The wholesaler Mediterranean Farm was founded in 2000, and in December 2000 the first three shops with the name Green Farm were opened. A new shop followed in 2001, another in 2002 and two more in 2003. At the end of November 2005 the eighth shop, with 180 m² of floor space, opened its doors. Except for one shop located in Patras, all the shops are in different parts of Athens. Tsibidis is of the opinion that the efforts to expand have reached a turning point, and two new shops will be opened in 2006. 'By 2008, we would like to have a total of 14 or 15, to include the second largest city in Greece, namely Thessaloniki, where another regional wholesale warehouse is planned.' At the moment he has a warehouse (1000 m²) and an office (270 m²) in Mandra Attiki in the west of Athens. 'We have nine different refrigeration units with varying temperature ranges for fresh produce,' Tsibidis explains, pleased with the recent doubling of refrigeration capacity. 'We have also bought a new site to the east of Athens, so that we hope we can build new, bigger facilities in the not too distant future.'

Whereas at the outset the turnover of the shops left a good deal to be desired, it has developed very positively in the meantime. Tsibidis is expecting an increase in turnover from 3.8 to 7.4 million Euros in 2005 for Mediterranean Farm. Of this, 35 % will come from the retail trade. By the end of 2006, the break-even point of the enterprise should have been reached. Each day, 1,300 customers enter the seven shops that had opened by the end of November - 200 per shop in round figures. It was also possible to increase the spend per customer, although this varies considerably according the location of the shops between 12 and 21 Euros. The proportion of fresh food in the total turnover is already 40 %, certainly lower than in Germany, but it indicates that the shops in Greece have already reached an advanced stage. The whole food trade in most countries begins with an easily managed dry range, with green and white fresh products that need refrigeration coming later.

Mediterranean Farm supplies 300 outlets all over Greece from its range, consisting of 3000 items. It also sells articles for chemists, cosmetics and frozen meat. 'With 65 items in fruit and vegetables, we stock a wide range of fresh products that we supply to all the shops.' That is how Tsibidis explains the scale of operations with green fresh produce. On the 22nd November 2005 he took over the fresh produce wholesaler Viofisi, which supplemented the dry range of Mediterranean Farm ideally. Mediterranean Farm has 85 employees and Viofisi 22.

The consolidated wholesaler supplies not only specialist shops but also the conventional retail trade, especially Carrefour, AB Vasilopoulos (belongs to Delhaize), Veropoulos, Sklavenitis and Champion Marionopoulos. In terms of the turnover of Mediterranean Farm, however, the conventional retail trade accounts for only 20 % and the specialist trade 80 %. 'On the other hand, turnover in the supermarket sector is growing much faster than in the specialist trade, so that by 2006 it could well be 50 % in each,' Tsibidis assumes.

In the future, the intention is to make available more and more own brands to supplement the imported branded articles. Biosis, Cretan Earth, Hellenic Earth are the names under which already a small number of articles are sold. Packaged vegetables are already sold under the label Agnokipos ('Healthy Garden'). Tsibidis estimates Mediterranean Farm's proportion of imported produce to be 80 %, with 20 % coming from sources in Greece.

The Green Farm shops are designed in a very appealing way, and they create a pleasant natural ambience with their wooden shelving. The layout of the specialist shop in the Marousi district of Athens is clear, and arranged according to types of goods. Trolleys await the customer in the shop. Tsibidis explains the business policy thus: 'We want to offer the customer everything under one roof.' Whereas in the case of meat and cheese many products are sourced from Greek production, the majority of milk products are imported from Germany. 'Every Friday at 2 o'clock in the afternoon, we place an order with Andechser for six pallets from their total range for our wholesale business,' Tsibidis explains. By Sunday evening the order has arrived by road haulage contractor in Athens and is sent out to the shops on Monday morning. 'There is a big demand for fresh milk and fruit yoghurt, in particular.' Organic production in Greece is limited mainly to various sorts of feta cheese and a few goat and sheep milk products. In the new Green Farm shop fresh meat is also on sale for the first time. Hitherto, 'only' frozen meat was available.

The 54 year old Tsibidis (picture) has had a varied career. As a dried fruit importer in London, he asked himself the question at the end of the 1990s whether he wanted to bring up his children abroad or to return to Greece after a long stay in England. Without the definite prospect of a job, in June 2000 he decided to return and sold his business in London. 'At that time, there were not many organic products on sale either in small shops or in the supermarkets.' This is how Tsibidis explains his decision to move into the organic sector. In Athens, his wife and a friend founded the firm Green Bay that began by importing organic items from, for example, Andechser Dairy Products. Through the business activity of his wife, Tsibidis came into contact with the company Mediterranean Farm, and he became its managing director in March 2004. Together with Viofisi and others, he has now become a shareholder.

Further information: www.greenfarm.gr