Jumbo will have to look for a new CEO as Ton van Veen is stepping down after two (challenging) years in charge. In what kind of state is he leaving the Dutch runner-up, and what kind of profile should his successor have?
An ungrateful task
This Wednesday, Van Veen unexpectedly announced his departure, although it was clear from the beginning that he would not stay at the helm for very long. Van Veen had stepped aside as CFO in 2022 to spend more time with his family, but he came to rescue a few months later when the then CEO Frits van Eerd was forced to step down due to involvement in a money laundering and VAT fraud investigation.
He did this out of loyalty to the family that founded Jumbo: after all, he is most of all a number cruncher who was the right-hand man of the fearless CEO van Eerd. He did the calculations behind several ambitious acquisitions, but never truly aspired to claim the CEO position. Without intending disrespect, Van Veen was mostly an interim leader out of necessity. He fulfilled that ungrateful role with vigour in the past two years, but that undoubtedly took its toll.
Back to the roots
Van Veen had a lot of debris to clear at Jumbo: the second biggest supermarket chain in the Netherlands missed the inspired leadership of its former CEO, saw its revenue growth slow and even had to endure a drop in sales last year, while market share also dropped for the second consecutive year. Market leader Albert Heijn was able to further increase its lead, while challengers like Dirk, Nettorama and Vomar seized their opportunities. Jumbo had lost its edge and was losing ground in the race to the lowest prices.
The CEO intervened: the supermarket chain had to return to its roots. He focused on the “seven certainties” that once made the company great and applied major cost-cutting measures. No more expensive sports sponsorships, restaurant chain La Place was divested, and one in four jobs at the headquarters was cut. He appointed entrepreneur Anrico Maat as Director of Sales & Operations. The new dynamic became visible with the launch of the private label Jumbo’s, aiming to bridge the gap between the standard private label and the A-brands.
Stronger position
The most significant move by Ton van Veen – according to himself – was the decision to join the international purchasing alliances Epic Partners and Everest. Combining its forces with German powerhouse Edeka means Jumbo now finds itself in a stronger negotiating position with its international brand suppliers. The effects of this move immediately became visible: the retailer did not shy away from tough price discussions and even boycotts. Empty shelves became a fixture in the yellow stores.
The CEO maintains was necessary: “We were purchasing too expensively; that is simply not affordable”, he said. The boycotts cost the retailer 25 million euros in revenue last year, which is not even 0.1 % market share. On the other hand, the international procurement has already earned the chain at least fifty million euros. Meanwhile, most conflicts seem to have been settled – but certainly not all of them – and price positioning has improved. An additional positive sign for the retailer is the news that its Belgian operations are becoming operationally profitable slightly earlier than expected. “This feels like a logical moment to hand over the baton”, the CEO therefore says in a press release.
Belgian ambitions
The question is: how solid is the foundation for further growth? His successor will have to secure that, as well as giving Jumbo a new, inspiring growth strategy. The challenges are not small: the competition is not sitting idle, employees have had to swallow a major cost-cutting operation and drastic changes were made. And while Jumbo may be big in the Netherlands, but it is still quite small in Europe. One statement Van Veen made at the press conference a fortnight ago stood out: “Without Everest and Epic Partners, Jumbo might not be an independent family business any more.”
The founding family now has to find answers to these and more questions. It says it has already started interviews for a new CEO, suggesting that they are already further along in that process than they let on. HEMA CEO Saskia Egas Reparaz is often tipped as a good candidate: her excellent track record at the department store chain has earned her the trust of the Van Eerd clan. However, at the moment that is only speculation. What is certain, though, is that Jumbo would benefit from an inspired, charismatic leadership figure who is at the forefront of the battle for the customer.
