ELOMAS: Fragile balances for the Greek supermarket group

By George Lampiris

The basic principle of operation of the supermarket shopping group, ELOMAS, is located in the fact that the companies that make it up – short and medium range chains – are under its wider umbrella. By joining it, they get better terms of negotiation with the industry during the supply of their products, joint promotions – offers on their shelves, while they have the opportunity to make moves on a single basis such as advertising on TV or in other media. , a joint brochure of purchases – offers in products, something that perhaps the individual companies that make it up could not do without the dynamics given to them by the partnership under the umbrella of ELOMAS.

The origin of these companies is located in all regions of Greece from Attica where for example the Gegos chain operates, to Crete where the cooperative company SYNKA operates, based in Chania, which recently agreed to establish a new joint venture with Masouti with a participation percentage of the two partners equally divided at 50-50.

Also participating in ELOMAS are chains from northern Greece such as the Hellenic Markets group with a turnover approaching 100 million euros, the Family Super Market based in Thessaloniki, but also businesses in the Peloponnese such as Andrikopoulos and Panagiotopoulos or Mykonos such as Flora Market as well as several other areas such as Gountsidis based in Drama.

The total network of stores that currently belongs to the ELOMAS group, according to at least the data that he lists on his website, is 831 points of sale and the member companies that make it up are a total of 28 different VAT numbers.

Why ELOMAS was created

ELOMAS was established in 1994, on the initiative of the then Deputy Minister of National Economy, Nikos Skoulas, with founding members Galaxias – Dimitra Market based in Corfu (acquired by SYNKA and now by Masoutis), Galinos Laoutaris with Evia which was later acquired by Atlantik, Gountsidis of Drama, Biskas in Thessaloniki acquired by Masoutis and INKA Chania (today’s SYNKA).

The creation of ELOMAS aimed to create a single scheme that would “protect” small and medium-sized markets from large chains at home and abroad, creating synergies within it and especially from the expansionist tendencies of Marinopoulos at that time.

The delicate balances today

At the moment, however, the data seems to be changing. As it was announced to the members of ELOMAS, SYNKA is going to leave the group after the recent agreement with Masoutis – for the approval of which the relevant position of the Competition Commission is pending -. In practice, this means the further weakening of the market group, which will lose 231 million euros, which is SYNKA’s turnover for 2021. And in essence, the total turnover of companies within ELOMAS will reach 615 million. euro.

This fact comes to devalue the bargaining power of the group, which had already received a strong blow in this sector, after the departure of the two major chains ANEDIK Kritikos and Bazaar, in the fall of 2020. This departure cost the 390 million euros of Cretan’s turnover (based on the financial data for 2020) but also an additional 190 euros of sales (2020 balance sheet) of Bazaar. Thus, from the 1.2 billion euros that the members of ELOMAS circulated in total until 2020, this amount suddenly decreased by almost half, ie to 620 million euros.

In 2021, targeted moves were made with the addition of new members who left smaller market groups such as Asteras, ELETA or others. This resulted in the addition of eleven new members with a turnover of € 9 million the smallest to € 33 million the highest, boosting the turnover to just over € 200 million and an effort to make up for losses from the departure of Bazaar and Cretan.

Inner challenge for the next day

However, the new entrants were also the ones who, according to information, started the procedures for the election of a new management committee a few days ago, which currently consists of the heads of SYNKA, whose chairman, Apostolos Alexakis, is also the chairman of its management committee. ELOMAS but also by the heads of the chains Andrikopoulos (Babis Andrikopoulos), Gountsidis (Christos Gountsidis), Gegos (Vangelis Gegos) and Hellenic Markets (Giannis Pilidis).

With the imminent departure of SYNKA from ELOMAS, in addition to the 231 million euros that are lost, the group remains headless at the same time without the president for many years, Apostolos Alexakis and his son Dimitris. A meeting of the members of the group is imminent on Thursday, with the aim of resolving the specific issues that arise and finding a successor to the leadership of the body.

At the same time, the information states that the establishment of a new market group with a focus on Northern Greece is currently being conceived, which will be an awe-inspiring rival of ELOMAS, something that is a matter of time to see if and to what extent it will happen or not. It is worth noting, however, that the former commercial director of ELOMAS, Costas Papaioannou, took over after his recent departure from ELOMAS, commercial director at Hellenic Markets, a member company of the group headed by Giannis Pilidis and based in Thessaloniki, a fact that according to some in the market could mean developments in the field of setting up a new group in the north.

Those who know say that the split in ELOMAS is waiting. After the agreement with Masoutis, SYNKA will negotiate for the products it puts on its shelves based on the agreements and the power of Masoutis, who now manages a turnover of 1.1 billion euros (his own together with the turnover of SYNKA). That is why SYNKA no longer has any reason to remain in ELOMAS, through which the joint trade agreements with the other members are still being negotiated.

Is the way open for acquisitions?

As for what will follow, market executives report to Capital.gr that the gradual split in ELOMAS, now opens the way for new acquisitions of its members by larger chains that have aspirations to strengthen the dynamics and the network of their stores nationwide. Let us not forget that Masoutis is very mobile and according to market sources, it is not enough at the moment in the agreement with SYNKA, as he is looking for other opportunities for expansion through acquisitions.