Theodotou: Alphamega Hypermarkets’ development plans, including new stores over the next two years

2024 will be a year of dynamic growth for Alphamega Hypermarkets , continuing to offer consumers expanded options, new stores and fully modern services.

Speaking to InBusinessNews as part of its IN Business Forecasting 2024 series, the CEO of Alphamega Hypermarkets, George Theodotou, states that at the end of 2024, a new store will be put into operation in Astromeritis, while work will begin within the new year for the construction of two more hypermarkets in Zakaki and Paralimni, with the aim of operating within 2025. The aim is also, within 2024, for construction work to begin on a new hypermarket in Engomi, which will be built on a piece of land opposite the existing Alphamega.

Referring to the biggest and most serious problem of businesses related to the difficulty of finding manpower, Theodotou emphasises the need to simplify the application procedures for the employment of foreign labor in order to meet the increased needs for personnel.

In terms of reducing the number of asylum seekers, many of whom work in retail businesses, he suggests that for every asylum application that is rejected, leading the applicant to leave the position in which he was working, that worker should be immediately replaced with a legal foreign worker.

How do you see the economic environment shaping up in 2024, in light of inflationary pressures, high interest rates and unpredictable ever-changing geopolitical developments?
First of all, let's refer to the encouraging estimates for the Cypriot economy. The Ministry of Finance sees a positive growth rate of 2.9% for 2024, while the corresponding forecast of the Fiscal Council amounts to 2.5%. Despite all this, the multiple challenges will not disappear, as a result of international instability and general geopolitical developments. The Cypriot economy has long been plagued by high inflationary pressures left behind by the pandemic and reinforced by the subsequent war in Ukraine, driving up the cost of living. The effects of the recent war in neighboring Israel add to the challenges for the Cypriot economy, which will continue to face inflationary pressures in the new year. That is why it is important that our economy demonstrates healthy reactions, adaptability and fiscal discipline. The private sector will continue to face challenges. Increases in the operating costs of companies due to the rise of both labour costs and energy prices are particularly troubling to the business world. Finally, as far as interest rates are concerned, their rise has stabilised and no further increase is foreseen. According to forecasts, interest rates will remain at the same levels and will start to decrease from the spring of 2024.

Investments and private consumption are drivers of the economy

What do you consider to be the biggest and most difficult challenges that the Cypriot economy will have to face?
As mentioned above, the wounds caused by the geopolitical realignments and the effects of the pandemic have put demands on the Cypriot economy, which require proper handling and well-considered steps. At the same time, the great difficulty of many businesses from the retail trade, hospitality and catering sectors to find a sufficient and suitable workforce is a very serious challenge, as the existing supply of workers in the domestic market cannot meet the ever-increasing demand. This is a big problem, which makes it difficult for businesses to operate and which is putting a brake on the development of the economy.

Would you say that, taking into account the latest upgrades, the Cyprus economy is now well on its way to growth?

In recent years, the Cypriot economy has been steadily developing, a fact confirmed by the positive ratings of the Credit Rating Houses, all of which now classify us in the investment grade. However, as I have already mentioned, a condition for maintaining this development trajectory is the right handling and the existence of comprehensive and balanced plans. In this context, an important parameter is to ensure an environment of stability and prospects for the business sector as well, as investments and private consumption are important drivers of the economy.

Optimism for retail trade, prolonged inflation is a concern

What do you think will be the course of the sector in which you operate in 2024?
2023 was a very positive year for retail trade, as confirmed by the Retail Trade Cycle Value Index, which in the January-October period recorded an increase of 9.8% compared to the corresponding ten months of the previous year. These data create optimism that in 2024 the sector will continue to register growth, not only due to inflation, but also organic. However, lingering inflationary pressures are an issue we are keenly concerned about. In the same context, the increase in operating costs is causing concern in our industry, which is due, as already analysed, on the one hand to the rise in energy prices and on the other hand to the increase in labour costs. Companies operating in the retail trade are required to develop those strategies that will allow them to adapt to this challenging environment.

What are the biggest industry trends/changes you anticipate in 2024?
Undoubtedly, the rapid development of technology in recent years constitutes a capital change at the heart of retail. For us, it is clear that digital transformation and the adoption of modern technological tools are the passport not only to maintaining the operation of the businesses in our sector but also to their sustainable development and profitability in the future, something that has already started to become evident and in the Cypriot market. As an organisation, we had foreseen this development in time, hence, long before the pandemic, we had drawn up a comprehensive plan for the digital transformation of Alphamega Hypermarkets, which also envisaged our activity in e-commerce. Today, we are particularly proud that our entire range of operations operates digitally, while we closely monitor the developments of the sector abroad, with the aim of continuously introducing the most modern technologies. In this context and with the aim of continuously upgrading the shopping experience of our customers, in 2023 we introduced a series of innovations, including the Click & Collect service. As a company we will continue to pioneer, offering customers state-of-the-art solutions that leverage cutting-edge technologies.

Additional permits for foreign workers and simplification of procedures

What are the most significant problems that are currently plaguing your sector and the solution of which is considered by you to be a priority in view of the new year?
A bigger and more serious problem at the moment is the difficulty of finding a workforce, as well as the state's reluctance to get involved in the problem, in order to give companies additional permits for foreign labour. As we are operating at full employment and there are currently no workers to fill the vacancies, it creates a staffing problem for many businesses, with implications on business growth and the economy in general. In fact, to the whole climate of difficulty in finding a workforce is now added the fact that the effort, on behalf of the Ministry of the Interior, to reduce the number of asylum seekers, many of whom work in businesses in the sector, has progressed rapidly. Under these circumstances, we are sounding the alarm, expecting to be given immediate permits to fill the positions with labour from third countries, as long as they cannot be filled internally, in order not to cause problems in the supply and operation of the enterprises as a whole.

If you could ask the Government to take specific measures or formulate policies to support/strengthen your sector, what would they be?
In connection with what I mentioned above, we would recommend that for every asylum application that is rejected, leading the applicant to leave the position in which he was working, that worker be immediately replaced with a legal foreign worker. Also, an important step for us is to simplify the application procedures for foreign workers. Unfortunately, however, we notice that time-consuming procedures are being applied in the competent Ministry, while many obstacles are being presented for its immediate resolution.

The development plan - New stores in 2024 and 2025

What are your organisation's plans/strategy for 2024? Should we expect new products/services/developments and your further establishment in the market? Will it be a year of growth/expansion or maintaining your existing market position? Can you tell us about any of your plans in particular?
2024 will be a year of growth for Alphamega Hypermarkets. We claim market shares, reaping the fruits of the trust that our customers have shown us for years, making us pioneers in the retail trade. Honouring this relationship, our goal is to continue to offer consumers expanded choices, new stores and fully modern services. In this light, we have created a development plan for the coming years, based on which at the end of 2024 a new Alphamega Hypermarkets store in Astromeritis will be put into operation. Also, in 2024, work will begin on the construction of two more of our new hypermarkets in Zakaki and Paralimni, with the aim of operating within 2025. We also hope that within 2024, construction work will begin on our new hypermarket in Engomi, which will be erected on a piece of land opposite our existing store in the area.

What role does technology, such as artificial intelligence, play and what changes is it expected to bring about in your field?
The food retail sector is rapidly, and in manifold ways, affected by developments in technology and Artificial Intelligence. Our company is already leading the way in digital transformation, offering leading services in e-retail. In this direction and given that the influence of Artificial Intelligence will increase rapidly in the coming years, we have already implemented several Artificial Intelligence applications in a pilot phase. These applications fall into the areas of demand forecasting, improving the online shopping experience by personalising each customer's needs, customer service and optimising our prices and offers. For Alphamega Hypermarkets, innovation and the utilisation of the latest technological developments are part of our strategy and DNA, which helps us to always be one step ahead of recorded trends and the competition.

(Source: InBusinessNews)