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Czech online grocer Rohlik ramps up German expansion as rivals quit

Czech online grocery delivery company targets more affluent, ecologically minded segments of the population in the Czech Republic, Hungary and Germany.

As foreign online grocery delivery rivals exit Germany, Czech Republic-based Rohlik Group is ramping up in Europe's biggest economy and is on track to break even within the next 12 months, founder and chief executive Tomas Cupr told Reuters.

The privately held company, valued at more than $1 billion in 2021, operates under the brand in Germany and opened in Berlin in April after launching in Munich in 2021 and Frankfurt in 2022.

It aims to add a further 15 German cities in the next few years after another fundraising round as it gets closer to a potential IPO, Cupr said in an interview last month at Rohlik's Prague headquarters.

"We have one eye on Hamburg, which would be the next city," Cupr said. "From Hamburg on, we would need to raise money."

"When I'm thinking about the mid-term stage a few years down the road we need to be the winner in CEE (central Europe) and DACH (Germany, Austria, Switzerland), and that is the IPO story as well."

For 2023, Rohlik turned a profit in the low tens of millions of euros in its home Czech market where it started in 2014. It was also profitable in Hungary last year but the overall group burned around 20 million euros due to the costs of the German expansion, he said.

The online grocer, which targets customers using quick delivery and a wide range of locally-sourced products, has invested in automating its distribution centres to boost efficiency and offer more delivery options, Cupr said.

"On a company level we will break even within the next 12 months including all the German growth," Cupr said. "Berlin and Frankfurt will consume cash for the next 18 months," he said, adding Munich was already turning a profit.

"We know how to make money in the CEE region and now we have a model of making Germany profitable," Cupr added.

Delivered by CzechTrade team Canada.
Source: Reuters.