STRESS CONSUMERS' VALUES, ICA PRESIDENT URGES

DAVID ORGEL

STOCKHOLM, Sweden -- Consumers need more than milk and meat from their supermarkets -- they also require a recognition of their basic values, said Roland Fahlin, who heads ICA, Sweden's biggest supermarket group.

Fahlin, in a speech here, said consumers are made insecure by the pace of technological development, job shifts, divorce rates and other phenomena.

"What they result in is a society based on insecurity for individuals," he said.

What can supermarkets do about these seemingly unstoppable dynamics? Top executives can take action to reassure consumers in order to foster trust and security, he said.

"Every business plan must communicate trust and confidence, for the individual, the customer and the employee," he said. "And you must take some risks by making commitments."

The need for action is greater today because business organizations have to a large extent taken over government's role as "the platform for peoples' hopes for the future," he said.

Fahlin spoke to a global audience of retailers and suppliers earlier this month during the Annual Executive Congress of CIES, the international food retailing organization.

ICA, which has a market share in Sweden of about 35%, is a group consisting of some 2,200 stores that are run and owned by managers of the units. Fahlin is president of ICA and chairman of ICA Association, Sweden.

ICA operates five store formats and, following a merger last year, also includes the market leader of Norway, Hakon Group.

Fahlin said customer confidence helps to prevent consumer panic during a crisis. He said that ICA hardly lost any sales during the mad cow disease crisis because the company has been honest and open with customers on food-safety issues.

Fahlin emphasized that his company's success is driven largely by its consumer-focused orientation and its ability to communicate its efforts.

"The fact that what we do is good for the consumer and for the society is not always clear to people," he said. "They will always question that, and we have to prove it. Not just by telling them, but by actively demonstrating it."

Fahlin noted that ICA's environmental policies have been based on consumer feedback. "We were the first to provide the customers with relevant information on environmental questions when that issue became hot in the '80s," he said. "And since then customer information on such matters has been the basis for our environmental policies in ICA."