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German food retailers are worried: Otto-group sets up countrywide web store Otto, the large German mail order company, starts to sell food all over the country. Having tested its concept in Hamburg, the Otto-Supermarkt-Service will now expand its operations to the whole of Germany. German food retailing is the most competitive in Europe, with razor-thin margins. During the last year, a rough price war has been raging, between Wal-Mart and the hard discounters such as Aldi and Lidl. Also other food retailers, such as Metro's Real and Extra, Rewe, the Edeka group and Tengelmann have been engaged. The large German retailers and particularly the many small and medium sized enterprises have suffered from this price war, where Wal-Mart has been the driving force. Workers are paying dearly as thousands of jobs will be lost. Traditional retailers now fear that Otto will take away important market shares from them and thus further aggravate the situation. |
