The success story of the Lenta hypermarket chain

The success story of the Lenta hypermarket chain

Being one of the largest retail chains in Russia, Lenta provides the optimal combination of local assortment and optimized shelf space in stores with the support of Strategix and JDA.

About Lenta

Lenta is the largest hypermarket chain in Russia (in terms of selling space) and the country’s fifth largest retail chain (Net Sales, 2015). The company was founded in 1993 in St. Petersburg. Lenta has 142 hypermarkets in 70* cities, across Russia, and 32 supermarkets in Moscow and St. Petersburg with a total of approximately 891,995 sq.m of selling space.

The average Lenta hypermarket store has approximately 6,100 sq.m. of selling space while the average Lenta supermarket store has approximately 1,000 sq.m of selling space. The company operates and owns six distribution centers.

The company’s price-led hypermarket formats are differentiated in terms of their promotion and pricing strategies as well as their local product assortment. The company employs around 38,414 people as of 31st of December, 2015**. The company’s management team consists of local and international markets experts. Lenta’s largest shareholders include TPG Capital and the European Bank for Reconstruction and Development, both of which are committed to maintaining high standards of corporate governance. Lenta is listed on the London Stock Exchange and on the Moscow Exchange and trades under the ticker: ‘LNTA’.

* Lenta’s calculation methodology for store locations. Cities located in Moscow City and the Moscow region are shown as Moscow. Cities located in the Leningrad region and St. Petersburg are shown as St. Petersburg. Data accumulated from May, 2015.

**FTE (full-time equivalent). Average FTE for 2015 was 31,307 employees.

The Challenge

Today´s market is characterized by constant change and development of consumer behavior and preferences. In order to compete sustainably, retailers have to be able to react to local needs. Lenta needed a solution that would help to meet such requirement, but most importantly, a system that was able to support their Category Management efforts.

The Solution

To perpetuate growth, efficiency and local adaption, Strategix recommended the market leading Category Management JDA Suite.

With JDA Space and Floor Planning the micro and macro space can be planned, optimized, measured and managed in an integrated way. Based on the store-specific sales and fixture data, as well as the forecasts from JDA Demand and Fulfillment, Lenta can use the JDA Planogram Generator to generate store-specific planograms in a matter of seconds.

To ensure that local stores implement the planograms and provide the necessary feedback, the planograms and floorplans are published automatically on a web platform. Such solution allows the stores to access the planograms and floorplans and communicate through it.

The JDA Category Knowledge Base allows for better allocation of Lenta’s resources by automating time consuming processes such as planogram lifecycle management and many more.

Moreover, the strong analytical capability the suite provides, allows Lenta to plan and execute its strategies and tactics more effectively.

Finally, Strategix acts as consultant and technical integrator for Lenta and supports it on a consistent basis in all matters concerning Category Management.

The Result

Lenta has developed one the largest hypermarket chain in Russia (in terms of selling space) and the country’s fifth largest retail chain (in terms of 2015 sales).

Due to optimum inventory levels, the number of required working hours to stock shelves has decreased and the number of inefficient inventory items has been eliminated.

An effective combination of local assortment and optimized space allocation ensures high customer satisfaction and retention.

By choosing the JDA Category Management Suite and relying on Strategix as the local consultant and technical expert, Lenta is now able to implement their Category Management efforts effectively.

39%

Growth of Selling Space in Russia

11%

Sales Growth

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