Although the consumption of alcoholic beverages will continue to decline, Gall
Gall expects higher operating results on flat sales in 1990. The expansion of the Gall
Gall chain will chiefly be accomplished through growth in the number of franchised
stores.
The Etos health and beauty aids chain in The Netherlands maintained its strong growth,
opening eleven new stores in The Netherlands in 1989, bringing the total number to
143, excluding five franchised stores. The sales area of Etos' own stores expanded to
198,056 square feet. Sales grew by 9.0% to Dfl 207 million, so that its market share rose
as well. Operating results improved considerably in 1989. In 1989, Etos concentrated
upon optimizing the Etos Beauty Case formula.
In 1990 both sales and operating results are expected to show further improvement.
In the year under review, Etos Belgium opened ten Beauty Case stores, bringing the total
number of stores in this country to 21, including 10 Colour Shops, with a combined sales
area of 16,738 square feet. The formula seems to be catching on well. The strong expan
sion entailed considerable start-up costs, so that operating results were negative, as
expected. Sales amounted to Dfl 8 million.
In 1990, Etos Belgium will continue to expand resulting in higher sales; however,
operating results will still be negative.
Pharmatos, the subsidiary responsible for pharmaceutical sales, had a difficult year and
did not meet expectations. Sales of Dfl 45 million lagged behind those of 1988.
Operating results were positive, but were under pressure as a consequence of disap
pointing sales and margin developments, as well as non-recurring costs. The 1989
expansion plans could not be achieved due to the many uncertainties and changes in
the pharmaceutical business.
Pharmatos will develop a new strategy to achieve higher sales and operating results
in 1990.
Ahold's teleshopping subsidiary James Telesuper improved its sales, but, as expected, its
operating results in 1989 continued to be negative. An important development was
James' participation in A'tel, a project which installed home computers for computer
ized ordering in a number of households in Amstelveen.
Early in 1990,James changed over to the Albert Heijn assortment providing a consid
erable increase in the selection offered to the consumer. Partly as a result of this formula
change James expects an increase in sales and improved operating results in 1990.
The Ter Huurne stores, located near the Dutch-German border, had a very good year.
Sales and operating results once again showed a considerable increase. In view of the
disappearance of internal boundaries in Europe after 1992, Ter Huurne is developing a
new strategy.
In 1989 the number of
Albert Heijn franchised
stores passed the 100
mark. 'It is going faster
than expected,says
Jan Manuel, Managing
Director of Albert Heijn
Franchising. 'The fran
chise organization cur
rently has a 3% market
share and its consumer
sales will exceed Dfl
1 billion in 1990. That
gives it some clout.
In the coming years
Manuel expects to see
further growth: 'How
ever, it is becoming
increasingly difficult to
find prospective fran
chisees with their own
stores, because most of
them are bound by con
tracts. This is why we
shall henceforth have to
rely mostly on newly
built units and change-
overs from Albert Heijn
stores.
20
