IN JULY 2007 STAR COMPANY TO OPEN FIRST SUPERMARKET WITH TRADE AREA OF 2100 SQ.M IN ARMENIA

ArmInfo
2007-05-21 20:23:00

In July 2007, Star Company, the largest trade network in Armenia,
will open the first supermarket with a trade area of about 2100 sq.m
in Yerevan. Yelena Abovyan, Head of the Company’s Design Department,
told ArmInfo correspondent that the new supermarket is situated in
the Nork third unit. She noted that in 2007 a multiformat conception
of the network’s development was approved, and this conception is
unprecedented for Armenia. "Division into formats allows to respond
to the preferences of consumers’ each segment more efficiently.

In case of the Star network, we suppose to develop three formats,"
Y.Abovyan emphasized. According to her, the formats will be
distinguished by their range of products, location, they will be meant
for different segments of consumers. The first format shops will be
situated in the center of Yerevan, in the business and recreational
zone, and will occupy an area of 200-400 sq.m.

"The quantity of assortment names will total 5000-7000, representing
both basic goods and premium class goods. The emphasis is done on the
supply of fresh products and cookery," Y.Abovyan noted. At the same
time, she pointed out that such supermarkets are meant for everyday
purchase, therefore the proportion of the assortment units of food
and non-food sectors makes up approximately 75% against 25%.

As for the medium format shops, Y.Abovyan noted that they focus on
complex purchase. "The assortment matrix of this format implies a
proportion of food and non-food items that makes up about 67/33,"
she said. The shops are situated in densely populated regions and,
as a rule, occupy separate buildings where other retail operators are
represented, e.g. mobile communication show-rooms, chemists shops,etc.

The third format supermarkets, trade halls, with an area of over
2000 sq.m. offer bigger number of assortment (about 20000), mainly,
due to an extended range of non-food items. Y.Abovyan emphasized
that she is not going to hold price differentiation yet, adhering
similar prices for similar goods in all the shops. "Meanwhile, the
perception of the price level may differ because of differences in
assortment. Large trade areas allow to offer wider assortment for
each category and bigger price range," she stressed.

Y.Abovyan also pointed out that at the moment the Star network of
supermarkets has two "city center" shops (in Amiryan and Tigran Metsi
streets), two medium format supermarkets (in Avan and Zeitun), and
one large supermarket to be shortly opened (Nork Massiv). In July,
Star will put into operation a new shop in the center of Yerevan
(in Mashtots Avenue), which will be different from the others by
the lack of counter service. By the end of 2007, the network will
comprise 10 shops. Speaking of a long-term outlook of development,
Y.Abovyan noted that by the end of 2010, the Star network will
comprise 10 supermarkets in the center of Yerevan, 20 medium format
shops and 20 large supermarkets, 4-5 of them in Yerevan, 15- 16 –
in the regions. Expansion in the regions is expected by the end of
2008. She pointed out that the company leases premarketing. "The
main activity of our company is a retail trade, as the purchase of
real estate would be an inefficient dstribution of resources. Let
realtors and developer companies do that," she said.

In conclusion, she noted that in the near future Star will implement
a project on opening small bakeries in the shops, that will allow to
offer the customers a wide range of baked goods under own brand.