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Corona-fueled shopping frenzy major boost for Israel’s supermarket chains

An executive said that Israel has no real problem with food shortages, only with specific products.

By Nurit Kadosh, Calcalist

As coronavirus, also known as Covid-19, fears grow and the number of people in home-quarantine rises, Israelis are descending on supermarkets to stock up their pantries.

Photos of empty grocery store shelves over the weekend have only exacerbated the situation, leading to long lines at stores and a boost in the number of home deliveries being ordered.

At retail supermarket chain Rami Levy, employees were called in Saturday night to fill up the shelves ahead of the new week. Supermarket chain Victory reported a 250% jump in online sales and a 50% increase in in-store shopping, day to date.

Shufersal Ltd., Yochananof, and drugstore chains Super-Pharm and Be all reported increased sales.

“Sales last week and yesterday were very high, especially for the dozens of products that can be stored, like pasta, basic food staples, snacks, and canned products,” a senior executive in the food industry told Calcalist on condition of anonymity.

“Increases were seen in both online and brick-and-mortar sales, and we are preparing for very high sales this week as well, until Passover. Right after Purim, we will start displaying Passover products.”

The executive further said that Israel has no real problem with food shortages, only with specific products that mostly have alternatives. “There might be a shortage of a certain tuna brand or some pasta, but there are replacements,” the executive said.

Industry experts are expecting the shopping frenzy to result in unusually high sales for the first quarter of 2020, thanks to a combination of corona-fueled stockpiling and Passover preparations.

However, despite the boost in sales, the stocks of public chains dropped Sunday, following the general trend seen on the Tel Aviv Stock Exchange: Shufersal closed 4% down, Rami Levy closed 3.7% down, and Victory ended the day with a 2.8% drop.

On Sunday, suppliers estimated the increase in orders made by retailers at 50% for products like pasta, canned goods, rice, and toilet paper, and at 20% for fresh foodstuff.

However, it should be noted that chains are expected to end Passover preparations as soon as next week: due to the large number of flights and travel plans canceled, more Israelis are expected to stay in the country for the holiday than in previous years, boosting the holiday shopping crowd.

Last year, 1.5 million Israelis spent Passover abroad, leading some in the industry to expect demand for kosher products will exceed the available supply.

“Passover sales will set a new record,” a senior industry executive told Calcalist, adding that he expects holiday sales to grow by 10% compared to last year even without stockpiling. “There is an attempt to increase the amount of products, but it is not always possible as manufacturing is based on pre-ordered kosher raw materials.”

Passover season in Israel is usually characterized by shortages in fresh produce like milk, chicken, and vegetables as many workers are on holiday. This year, it seems shortages in kosher dry products are also to be expected.

One large retailer has estimated that people could start buying ahead for the holiday as soon as next week, out of fear of products running out.