Recommending a Strategy

1
Modelo Continente, SGPS, SA Changing
Portugal over the last 20 years 1985
2005 Universidade Católica Portuguesa, 11
November 2005
www.ModeloContinente.pt
2
Snapshot 2004 figures
No.4 retailer in Brazil (No.1 in southern
region of Brazil)
4.1 Bn gross sales (130,000 sales items in
portfolio)
No.1 retailer in Portugal (in food retail)
870,000 sqm sales area (in 452 stores)
41,615 employees (38,278 FTE)
4,550,000 sales receipts/week
Full Time Equivalent
3
Global retail portfolio 2004 figures
Portugal
Brazil
mini-hypermarkets
hypermarkets
supermarkets
Food based formats
wholesale
hypermarkets
supermarkets
supermarkets
kidswear
DIY
Non food based formats
clothing
sports goods
consumer electronics
computers
4
Value creation strategy
Value Proposal
Growth

• Portugal
• Market leadership in food formats
• Synergic development into non food formats
• Brazil
• Rapid expansion (organic growth and MA)
• Commercial and operational fine tuning

• Supply chain integration
• Category management
• Information systems development
• Human resources development

5
Changing Portugal over the last 20 years
19861990
19911995
1985
19962000
20012004
2005
6
Pioneering spirit gt 1985
Joint-venture with Promodès opening of the first
hyper in Portugal
7
Leadership ambition gt 1986 1990
Opening of new hypermarkets and mini-hypermarkets
Price competitiveness and Market share increase
Perishables centralised logistics
8
Dynamic growthBest practices implementation gt
1991 1995
Rapid food formats expansion
Category management implementation
Own brands programme
9
Dynamic growthBest practices implementation gt
1991 1995
Reengineering of the logistics network
(warehouses, stock flows, merchandising)
Development of the information system
network (store/warehouse, cash-flow, HR, )
10
Integrated diversification strategy gt 1996
2000
Multi-format approach (Worten, Modalfa,
Sportzone, Vobis, Maxmat)
2nd generation hypermarket Colombo
New store organisational model
11
Integrated diversification strategy gt 1996
2000
Rapid non food based format expansion
EDI with suppliers Clube de Produtores Sonae
Electronic Data Interchange
12
Consumer focused strategy gt 2001 2004
Consumer satisfaction index panels
Shop along programme
Strong and innovative promotional campaigns
13
Consumer focused strategy gt 2001 2004
On-line retail Continente, Worten, Vobis
Industrial units meat processing, bread and
pastry production, fish distribution
14
Key indicators Portugal
Stores
Sales area
Employees
340
500,000
22,500
Clients per week
Gross Sales
EBITDA
3,100 M
230 M
2,300,000
15
A company preparing itself for the next 20 years
3rd generation hypermarket Antas e Loures
Innovative promotional campaigns
Internal processes optimisation (commercial and
operational)
16
A company preparing itself for the next 20 years
Mini-hyper aggressive expansion
New retail formats (Worten Mobile, Zippy
kidstore, Pharmacies)
Human resources development (2005e 650,000
training hours)
17
Modelo Continente, SGPS, SA Changing
Portugal over the last 20 years 1985
2005 Universidade Católica Portuguesa, 11
November 2005
www.ModeloContinente.pt