Business model

ICA Gruppen AB is one of the Nordic region’s leading retailers with its own and retailer-owned stores, located in Sweden, Norway, Estonia, Latvia and Lithuania. ICA Gruppen is also represented in Finland through the portfolio company Hemtex.

At the heart of ICA Gruppen’s operations is grocery retail where the grocery stores are the hub of our business. Around this we have built up a number of operations which individually or in combination are contributing to our attractive customer offering and our stable market position. ICA Gruppen consists of ICA Sweden, ICA Norway and Rimi Baltic, which are mainly involved in grocery retail, ICA Real Estate, which owns and manages properties, and ICA Bank, which offers financial services to Swedish customers. The Group also includes five Portfolio Companies. (For more information on the Portfolio Companies’ operations and focus, see Portfolio Companies.)

ICA Gruppen has more than one business model. The idea is to combine the best aspects of entrepreneurship with the best of economies of scale. The ICA concept of individual retailers working in cooperation, which combines diversity and local adaptation with economies of scale and efficiency, is still a cornerstone, at both the national and local levels.

Breakdown of sales
  

Sweden

ICA Sweden is a grocery retail business operating throughout Sweden in cooperation with independent ICA retailers. ICA Sweden is responsible for coordinated sourcing, logistics, marketing communication and support for retailers in areas such as marketing and store development. There are five different grocery store profiles: ICA Nära, ICA Supermarket, ICA Kvantum, ICA To Go and Maxi ICA Stormarknad, which are operated as a combination of independent retailers and an integrated chain, where the retail part is operated by the retailers and the non-food part is operated by ICA Sweden’s subsidiary Maxi Special. Cura pharmacies are also part of ICA Sweden.

ICA Bank offers financial services to customers in Sweden and has agreements with almost all ICA stores in the country. ICA Bank helps improve loyalty to the ICA stores while reducing the cost of the financial flows in the ICA system. Offering financial services is one of ICA Gruppen’s many activities to promote loyalty. In Sweden, ICA Bank’s customers can save, borrow and obtain insurance. Net interest income and commissions contribute to ICA Gruppen’s earnings and when customers use ICA Bank’s own bank cards, the fees payable to other card issuers are reduced. The bank also offers services such as payment terminals and ATMs to other companies for a fee.

ICA Real Estate’s task in Sweden is to find appropriate properties in the right locations in Sweden. This is done today through a combination of owning, leasing and strategically developing marketplaces. The tenants are ICA retailers as well as other businesses. The operations generate consistent revenue in the form of rents. The sale of properties that have increased in value is also a source of profits for ICA Real Estate.

The Swedish ICA stores’ fees to ICA Gruppen

Required

  • Joint organisation, so-called ICA Fee, based on the stores’ net sales (%)
  • Logistics fee, based on wholesale sales (%)

Voluntary

  • Additional services at market rates, e.g. financial and marketing
  • Cost-based additional services, e.g. store IT

Profit

  • Wholesale profit, based on wholesale sales (%)
  • ICA agreements, royalties/dividends, royalties are based on store net sales (%)

Norway

ICA Norway operates its grocery retail business throughout the country under the brands ICA, Rimi and Matkroken. Around 60% of the stores are wholly-owned and operated by ICA Norway and the remaining 40% are operated as franchises. ICA Norway coordinates sourcing and is responsible for logistics and coordinated market communication for all of the stores.

ICA Real Estate’s task in Norway is to find appropriate properties in the right locations. This is done today through a combination of owning, leasing and strategically developing marketplaces. The operations generate consistent revenue in the form of rents. The sale of properties that have increased in value is also a source of profits for ICA Real Estate.


Baltic countries

Rimi Baltic is a grocery retailer operating in Estonia, Latvia and Lithuania. All of the stores are wholly-owned by Rimi Baltic. Rimi Hypermarket and Rimi Supermarket stores are found in all three countries and the focus is on fresh food and good service. The discount segment consists of Säästumarket in Estonia and Supernetto in Latvia.

Rimi Baltic is responsible for real estate transactions in the Baltic countries.