puregold

Puregold Price Club eyes smaller players

(Source: Inside Retail Philippines | 11 May 2016)

Puregold Price Club wants to take over smaller supermarket operators to expand its store network outside Luzon.

Puregold Director Leonardo Dayao said the grocery retailer continues to talk with supermarket owners, offering a multiple of “8-12 times of the net income we think we can make out of it.”

“We’re still not well represented in the Visayas and Mindanao so if we can find an acquisition in those areas that will hasten our presence,” Dayao said.

At the end of 2015, Puregold has 255 stores nationwide, six of which are in Visayas, and seven are in Mindanao.

Dayao said there are several chains of supermarkets outside of Luzon comprising a network of as much as 10 stores “except that many of (the owners) are not yet ready to retire.”

“Most of those that we bought, the owners are in an advanced age, they’d like to cash in and the children are not ready to run the business.”

The country’s second largest retailer bought eight Budgetlane supermarkets and nine NE supermarkets in 2015. Apart from acquisitions, the company is looking at organic growth for expansion, with plans to open 25 new Puregold and two S&R Membership Shopping stores to its network to boost sales by 12-15 per cent.

Puregold is allocating P1 billion for 25 new Puregold stores and another P1 billion for two S&R stores. Another P150 million will be spent for 10 new S&R New York Style Pizza stores and P450 million for 75 new Lawson convenience stores.

 

Read more: https://insideretail.ph/puregold-price-club-eyes-smaller-players/

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