ICA invests 4 billion in 2019

ICA Maxi is the ICA group's hypermarket concept. Photo: Jessica Gow/TT
ICA Maxi is the group's hypermarket concept, other well know grocery store brands are ICA Supermarket, ICA Kvantum and ICA Nära. Photo: Jessica Gow/TT
By Reidar Molthe

14 December 2018 09:42

ICA invests 4 billion in 2019

The Swedish grocery giant, ICA, will increase total investments by 500 million SEK next year, to 4 billion SEK, compared to 2018.

CEO Per Strömberg said in a statement Thursday 13 December that it had doubled IT investments in 2018 and it would continue to invest heavily in its store network, IT, customer relations and e-commerce.

"Digitization and our corporate structure give us a number of new opportunities to create synergies and new customer benefits, says Strömberg. To capitalize on these opportunities and ensure long-term growth, we need to maintain a high rate of investment," he argued on the capital markets day in Stockholm Thursday.

The shares of ICA, however, decreased moderately during the day.

E-commerce & Convenience

The Ica Group Board has identified seven major strategic priorities for the food giant in 2019. Priorities will, if it goes as intended, contribute to more cooperation and synergies for increased growth and profitability within the group.

ICA CEO Per Strömberg. Photo: Jessica Gow/TT
ICA boss Per Strömberg, along with the board, has chosen seven strategic focus areas for the grocery giant. The two most important are digitization and convenience.

“The group structure of ICA Gruppen already creates economies of scale and important synergies, such as joint loyalty programs, co-location of stores and pharmacies, joint purchasing and administration. But digitization also enables further synergies within e-commerce, customer data and investments in new technologies and skills,” argues Strömberg.

There is no doubt however that E-commerce and convenience are two of the most important strategic priorities in the group which has a market share in Sweden of more than 50 percent.

One of ICA's biggest challenges is their own success. The group cannot grow much more in the domestic market without meeting critical view from the competition authority or politicians.

7 strategic focus areas in ICA

  • Online: Continue rapid growth, expand offers and boost deliveries to win e-commerce.
  • Store network and store concept: Develop store network and format strategy, focusing on convenience, big city and future supermarket.
  • Personalization and loyalty: Scale up smarter personal offers, improve the loyalty program and launch new digital services.
  • Working methods and skills: Improve and scale up new agile practices and collaboration between companies as well as build critical skills in IT development and advanced analysis.
  • Core processes: Increase stability and cost-effectiveness in core processes with a focus on logistics and joint purchases.
  • Automation and AI: Expand process automation and launch AI / Data Science tests on a selection of applications for increased efficiency and optimized business processes.
  • Climate and health: Drive Ica's sustainability work "For a good tomorrow" with a focus on health and climate.

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