LONDON -- The euro will be a boon for both European retailers and consumers, according to Richard Fedigan, chief executive officer of the Paris-based CIES, The Food Business Forum.
In an interview last week with SN, Fedigan said the euro -- which goes into circulation on Jan. 1 -- will foster competition among retailers, encourage better service and create economies of scale that will mean savings for retailers and consumers.
The 12 euro-currency countries include Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain. Britain and the Scandinavian countries opted not to convert their currencies to the euro.
Across Europe, large-scale retailers such as Paris-based Carrefour already rounded down their prices on Nov. 1, and froze them until March 31. The move was both for logistical reasons and to give consumers a sense of confidence, making it clear they won't be cheated when the euro appears.
"The people we represent -- retailers that have 10 to 3,000 stores -- are well-prepared for the euro, and had already adopted dual-pricing earlier this year," said Fedigan, adding that many companies have had to make sacrifices in anticipation of the euro.
"The rounding-down cost for German retailers, for example, was 1.2 billion DM [$552 million], in a 120 billion DM [$55.2 billion] market -- which is quite high. But the risk of not doing so would have been loss of consumer confidence," he said.
The larger retail chains have also beefed up customer service in anticipation of the new currency. At Auchan, a French supermarket chain, all checkouts will be open nonstop for the month of January to prevent long lines forming at cash registers. But consumers are not the only winners.
"The pan-European retailers will be able to take advantage of economies of scale, in supply chain and administration costs, for example, because they will no longer have to pay the requisite charges for working in different currencies," Fedigan said.