Russian Discount Retail Chain Mere to Launch First Stores in Hungary This Year

The Russian discount retail chain Mere is set to make its debut in Hungary by opening its first stores in Budapest, Vác, and Szeged within the year. This ambitious expansion marks Mere's first foray into the Hungarian market, aiming to challenge established discount retailers such as Lidl and Aldi.

Mere plans to open up to 100 stores in Hungary within the next 5 to 10 years. The company has chosen a strategy of converting existing buildings rather than constructing new ones, and is currently in advanced negotiations to secure rental properties in these key locations.

Why this matters: Mere's entry into the Hungarian market has broader implications for the retail sector and could reshape consumer habits in the country. This could lead to increased competition among discount retailers, potentially driving down prices and benefiting consumers.

The company operates on a unique business model that focuses on offering lower prices by maintaining a lean 15% margin, significantly lower than the typical retail margin of 45-60%. This approach is designed to appeal to price-sensitive Hungarian consumers, with the goal of providing products up to a third cheaper than traditional retailers.

Mere's strategy also includes sourcing products primarily from domestic producers who have not yet penetrated the shelves of major retail chains. This could create new opportunities for local suppliers and contribute to the Hungarian economy.

Despite initial skepticism about Mere's ambitious plans, unnamed sources have confirmed that the company is serious about its expansion into Hungary. Preparations are well underway, with the necessary documentation for store openings already compiled and contracts for property leases in Budapest's 4th district, Vác, and Szeged close to being signed.

The arrival of Mere in Hungary is expected to shake up the existing retail market, which is currently dominated by Lidl, SPAR, and Tesco. Lidl, for instance, has about 200 stores in Hungary, a milestone it reached over 15 years. Mere's goal of opening 100 stores in 5 to 10 years is ambitious, yet achievable if the company can operate reliably and professionally.

While the exact timeline for the store openings is not specified, it is clear that Mere's preparations are in full swing. The company's success in Hungary will depend on its ability to meet regulatory requirements, secure suitable properties, and effectively market its low-cost offerings to Hungarian consumers.

To recap, Mere's entry into the Hungarian market represents a significant development in the retail sector. With its focus on low prices and domestic products, Mere is set to offer a competitive alternative to established discount retailers, potentially reshaping consumer habits in Hungary.

Key Takeaways

• Mere, a Russian discount retail chain, to debut in Hungary with 3 stores in Budapest, Vác, and Szeged.
• Mere plans to open 100 stores in Hungary within 5-10 years, challenging Lidl and Aldi.
• Mere's business model offers lower prices with a 15% margin, appealing to price-sensitive consumers.
• Mere sources products from domestic producers, creating opportunities for local suppliers.
• Mere's entry could reshape consumer habits in Hungary, driving down prices and benefiting consumers.