...Issue/risks Fitch's view Trading environment Consumer confidence has globally improved in 2016. In France, the presidential election in May 2017 could create some volatility. Uncertainty is growing in the UK as the effects of the Brexit vote start to kick in. In Russia and Brazil consumption should improve along with the economic environment but the trading environment should remain difficult due to increased competition. Competitive activity Western European food retailers face increasing pressure from alternative channels and formats (disintermediation, online retailers, hard discounters). Fiercer competition translates into a steady price pressure. Traditional retailers look for alternative sources of revenues through the development of online sales, new store concepts, and a higher level of in-store services. Operating margins Rebuilding of margins through cost base reduction (cost-cutting, purchase partnerships to increase purchasing power) rather than higher prices. Increasing online...
