Portugal flag Portugal: Buying and Selling

The distribution network in Portugal

Evolution of the Sector

The Portuguese population is concentrated along the coast. The major distribution centres are Lisbon in the south and Porto in the north, although the regional centres of Braga (north of Porto) and Setubal (south of Lisbon) have come into their own in recent years. The Lisbon area has the highest purchasing power in the country and suffers.

In 2020, the retail sector was negaitvely impacted by the Covid-19 pandemic but the food segment performed well. According to figures from the Portuguese Association of Distribution Companies (APED), food retail sales increased 8.1% in volume in 2020 compared to the previous year. In value, food sales in large-sized commercial establishments increased by 2.9% compared to 2019, reaching EUR 13.8 billion in 2020 (INE). Supermarkets remained the largest channel within grocery retailing in the country in terms of value in 2021. Given the increasing trend for local consumers to make more frequent trips to grocery retailers (although with a lower overall spend), major chains have been adapting by opening smaller stores nearer to local neighbourhoods and enhancing customers in-store experience (for example introducing leisure areas). At the same time, the weight of promotions in food retailing continued to increase, making Portuguese consumers those who show greater appetite for promotional campaigns in Europe.

The competitive environment is quite concentrated in the grocery store-based retailing, with Continente accounting for the largest share, followed closely by Pingo Doce. The market share of the five major distribution groups in Portugal has considerably increased in the last decade, accounting for around 70% (USDA, latest data available). However, in 2019 the Spanish retailer Mercadona opened its first store in Portugal (it had 32 stores in July 2022), and it could impact retail dynamics in the Portuguese market.

Changing consumer habits, demographic factors and the development of e-commerce and new technologies are leading the sector to conceive new commercial formats, where consumers increasingly appreciate proximity and value-added services. Consumers are buying more online and retailers are increasingly investing in this channel, especially following the outbreak of the COVID-19 pandemic and the restrictions that followed.

Market share
Portugal's retail sector is among the most concentrated and competitive in Europe. Grocery retailers remain the largest of the retail sector.

According to the latest figures available from the USDA, the Portuguese food retail market is highly concentrated, with a market share divided as follows (2020):

•    Sonae Group (including Continente, Modelo Continente - hypermarkets brand leader) is the country's most popular grocery retailer with a market share of 26.8%
•    Jeronimo Martins in the challenger (Pingo Doce - supermarket leader) has a share of 22.9%
•    German discount Lidl - 11.3%
•    Intermarché (France) - 8.8%
•    Auchan Group (from France) - 5.6%
•    Dia (Span) - 3.9%
•    Leclerc (France)
•    Aldi (Germany)

Retail Sector Organisations
Portuguese Association of Distribution Companies (APED)
Ministry of Economy

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Latest Update: September 2022