Smaller floor areas, lower shelves and more specialist counters are among the features of newly opened Auchan and Carrefour stores, as supermarkets try to cling on to customers.
More attention is also being paid to décor, with details such as wood panelling to make counters more attractive.
Prices, however, are not coming down: food items still face inflation of around 2% a year, on top of the huge jump in prices seen after the Russian invasion of Ukraine.
Bread flour, which cost €2 for a 1.5kg bag before 2022, is now close to the €2.50 mark, a 25% increase. This is despite the fact wheat prices have come down.
Mounting losses
In 2014, hypermarkets accounted for 41% of sales from the major shopping chains in France, but that figure has dropped to 35.2% this year.
The latter is also in hot water after a restructuring plan, which would have seen 2,400 jobs lost, was ruled illegal by an administrative court in Lille.
The company, which is privately owned by the Mulliez family, said it will appeal the decision.
Auchan announced a €973million loss in the first half of 2024, and has been struggling to improve its financial situation since, notably by cutting employment numbers in the social plan the court ruled was illegal.
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It has also reduced 71 of its 119 hypermarkets in size. Examples include remodelling shops in Orléans by between 12% and 20%, and in Châteauroux by 33%. The company plans to reduce the size of another 60 hypermarkets by 2027.
However, it is not only the large hypermarkets that are struggling.
The French branch of the German supermarket chain Lidl has made a loss for the last two years, blaming the effects of inflation, which it said has caused customers to buy less.
This year it has moved away from slightly upmarket branded goods to concentrate on in-house brands, with lower prices but less choice. The formula was used in its first expansion in the country.
Lidl France’s new boss said the strategy was already bearing fruit and it was likely to make a profit again at the end of its 2025/2026 financial year in February.
This year has also seen the downsizing of the Casino group, which includes Casino supermarkets, Géant hypermarkets and Monoprix stores.
Some of its shops have been taken over by Intermarché and Carrefour, others have shut and the remainder of the group is now being run by Czech billionaire Daniel Křetínský.
The former CEO of Casino, Jean-Charles Naouri, was due before the courts in October accused of planting a false rumour in September 2018 that Carrefour was interested in a takeover bid.
Carrefour was forced to issue a press release in the early hours of the morning to deny the rumour and its managing director, Alexandre Bompard and bosses from Lazard bank, one of France’s elite merchant banks, are expected to be called as witnesses.
At the time Lazard bank was hired by Carrefour to carry out a number of studies, and Mr Naouri claims one of them was for a takeover of Casino.
Carrefour claims it has turned the corner in France, mainly thanks to a system it calls lease management whereby hypermarkets and supermarkets are now owned by franchisees.
A total of 11 hypermarkets and 12 supermarkets had been sold by the start of July, and Carrefour also opened 274 ‘convenience stores’ – its name for small city centre shops – in the first half of the year.
These shops usually have higher prices than supermarkets and hypermarkets, but stock the same brands.
Another change for supermarkets is the increasing use of ‘Drive’ services, which were first pioneered in France 20 years ago. Customers order their shopping online before picking it up at drive-through garages or parking spaces. Digitally controlled lockers are also being trialled as pick-up points, which can be accessed day or night.
Around 40% of French people have used Drive services for their shopping so far in 2025, according to a report by NielsenIQ consumer research. Many say it allows them to better control their spending.
Higher food prices over past year – but energy costs down
Cost of services and food predicted to fall slightlyInsee
Consumer goods prices have increased by an average 1.2% in the past year according to the most recent data, driven in particular by a rise in tobacco and service costs.
However, sharp reductions to energy (-4.5%) and communication service (-12%) costs have helped to reduce the overall impact on household budgets.
Food costs, including fresh perishable goods, rose by 1.7% and 1.6% respectively in the past year, slightly higher than the average.
The information comes from a recent report by state statistics agency Insee.
The increase is fairly low compared with the early 2000s and the inflation peaks following Covid-19, the latter of which saw prices increase by more than 6% between February 2022 and 2023.
However, the potential impact of the 2026 budget, including a possible freeze on income tax bands and low wage growth, means even a small increase has an effect.
