CEO passes torch at Ahold Delhaize
ZAANDAM, Netherlands — Seven years ago, as the newly appointed chief executive officer of Royal Ahold, Dick Boer was focused on implementation of Reshaping Retail, a strategy designed to enable the company to better meet consumers’ changing needs with supermarkets and small-format and specialty stores, as well as an emerging array of omnichannel capabilities. Reshaping Retail proved an apt designation for Ahold’s evolution; it works just as well as a summation of Boer’s impact on a business that he has been associated with all his life.
The son of an independent grocer in the Netherlands, Boer stepped down at the end of last month as the head of one of the world’s premier retailers, a company that operates some 6,600 stores under 20 banners in Europe, the United States and Indonesia that serve more than 50 million customers every week. The consolidation of that global retailing empire through the merger of Ahold and Delhaize Group, in July 2016, is the cornerstone of Boer’s legacy after four decades in retailing.
“It’s been an interesting journey since the merger,” said Boer, who joined Ahold in 1998 as chief executive of its business in the Czech Republic and made his mark as president and CEO of Ahold, comprised of Albert Heijn supermarkets, Etos health and beauty stores, and Gall & Gall liquor stores. “Looking back, you can see that Ahold and Delhaize came together very nicely, putting us in position to maximize the strength of our local brands by providing centralized support.
“The culture and the people are such a logical combination. We had a leadership meeting in the U.S. in May that brought together 130 of our top managers. If you didn’t already know, it would have been really difficult to say who came out of Delhaize and who was from Ahold. It’s such good group of exciting and enthusiastic people whose first concern is what’s best for the customer.”
During the integration process — which was spearheaded by Frans Muller, who prior to the merger was president and CEO of Delhaize and took the reins at the combined company from Boer on July 1 — Ahold Delhaize continued to perform well financially. In fiscal 2017, companywide sales increased 1.7% to 62.7 billion euros and net earnings soared to 744 million euros, while profit margin rose from 3.7% to 3.9%, and the dividend was increased 10%. The U.S. is Ahold Delhaize’s biggest market segment, with the U.S. brands generating two-thirds of its revenue.
“Two thousand seventeen was the first full year as Ahold Delhaize, one in which we substantially completed the integration.” Boer said at the time the results were released in February. “We delivered synergies ahead of schedule and continued to show underlying operating margin expansion with stable or increasing market share in our major markets. In a dynamic environment, our great local brands delivered strong results, tapping into changing consumer behavior.”
In addition, Ahold Delhaize continued to play a leadership role in areas that were at the forefront throughout Boer’s tenure — technology, personalization, owned brands and sustainability.
“Technology is accelerating the pace of change in our industry to an unprecedented degree,” Boer noted. “First, it is improving logistics and management systems, so the ordering process and the predictability of what’s on store shelves is more accurate, which makes things better for the consumer. Second, tools like self-checkout, shop-and-go technology and apps enhance the customer experience. Last but not least, whoever or wherever you are, you’re always able to shop for food and pick it up at the store or have it delivered to you.”
Impressive as those advances are, Boer indicated they are just the beginning. Ahold Delhaize is already hard at work harnessing the wealth of data generated by digital technology to do a better job of addressing the specific needs of individual shoppers.
“As retailers we have a lot to offer. We intend to utilize the information we have for the benefit of our customers, to support them in their shopping,” he explained. “We have better insights than anyone else into our customers’ needs and behaviors. If our customers agree to let us use the data — which they own — we can really help them, which makes us unique as retailers.
“We understand that the customer is in charge; everything we do is customer directed. If we can assist her in a way that helps her to shop more easily, to predict better the order that she needs, to help with dietary needs, live a healthier lifestyle or save money, that’s a good thing for her and for us.”
A customer-centric approach comes naturally to Boer. Having learned that ethos from his father, he, in turn, instilled it in colleagues throughout his four-decade career, which in addition to Ahold Delhaize included management posts at Unigro NV and SHV Holdings. Boer reiterated the importance of maintaining an unwavering commitment to the consumer and the essential role that this commitment plays in retailing during Ahold Delhaize’s annual general meeting of shareholders in Amsterdam last April.
“You need to enjoy helping customers with everyday things,” he said. “Your job is to help people do their shopping as smoothly as possible. And to perhaps get them to buy just a little bit more than they planned. Never a lot more — the point is that the customer must also be pleased with that little bit extra. In this respect, being a grocer is a job full of small wins. But for me as a grocer, helping customers is still the essence of the profession. Yes, I am going to miss it.”
In light of Boer’s skill as a leader, willingness to embrace retail innovation and ability to get things done, it’s safe to say that his colleagues, company and industry will miss him as well.