Adam Manikowski, Żabka Group, AmCham DINER at the Economic Forum in Karpacz 2024

Karpacz. Well, to be honest, I got used to it because we are practically everywhere, even though the potential for development is very... this year we will open.

Yes, undoubtedly we are the largest franchise in the country, but also the most democratic. Joining cooperation with Żabka does not require many costs because Żabka provides the location, equipment, goods, practically everything needed to run a business. But what is key is to reach the largest possible group of potential franchisees. We have invested a lot in simplifying the franchise system, meaning a lot of investment in systems that allow and help the franchisee run their business, run the store practically intuitively. This is of course related to new technologies and processes, but also to the training system. So now I can say what is different from many years ago: anyone with an entrepreneurial spirit, who likes customer contact and would like to run their own business, after going through the training process, is able to successfully run their store with the support of the tools we provide.

Onboarding is extremely important. Why? Because our task is to ensure that the shopping experience we provide to customers is consistent across all nearly 11,000 stores. To achieve this, to be able to deliver that, we also need to be sure that all franchisees have similar knowledge and similar tools to run their store so that a customer shopping at different Żabka stores has a similar shopping experience. That's why training is so important. But this training is also effective because we can tailor it individually to each candidate. As we know, some candidates have more business knowledge, others have better soft skills. So depending on the candidate, we adjust the training material. The entire training takes less than two weeks, and later there is a longer period when the franchisee has so-called shadowing, meaning they have a person supporting them in their daily duties. In addition, the tools and systems we give to the franchisee help us, together with all this, to ensure that stores run by different franchisees, different candidates, have the same consistent appearance and create consistent value for our customers. Therefore, the topic of training, but also the topic of tools, is extremely important from the perspective of business consistency and how the customer feels when shopping in our stores.

A lot, and that is precisely what makes Żabka successful: we are able, thanks to technology, to adapt to local customer needs. Imagine that because we invested heavily some time ago in the so-called technological transformation, i.e., investments in artificial intelligence, big data, machine learning, Internet of Things, as well as robotics and automation, we are able, depending on the location, to adjust the layout, planogram, but also price levels. From the central level, we manage nearly 300,000 different planograms, which means the way products are arranged, but also which products are on the shelf. And that is the strength of Żabka: a Żabka in a small town is slightly different from a Żabka in a larger town, and that creates the locality of Żabka. And this locality is further strengthened by the franchisee, who is largely part of the local community, as is their team of cashiers, who also form the local community. And what customers tell us is that they appreciate not only the convenience of shopping at Żabka, but also that they feel at home, they know the franchisee, they know the cashiers. So this locality is huge. Taking into account also the question that was asked about to what extent the franchisee has influence on what is in the store, we have a space in the layout that is managed by the franchisee. For example, the franchisee decides to a certain extent what goods are sold in that store, which allows us to be even more local in terms of local brands and local products.

I'll say this: some time ago, interestingly, in difficult times, during the pandemic, we made a decision to accelerate the development of Żabka. Since then, we have been successfully opening over 1,000 stores each year. And seeing the potential, how much infrastructure is developing in Poland, for the next few years we do not intend to slow down; we intend to continue opening over 1,000 stores annually. This is related to Żabka's business model: the value we create for customers has been very well received by the market. We can say we are unique in the Polish market. But it is also related to the development of the Polish economy, because the infrastructure that is developing in Poland, new housing estates are being built, customers are becoming wealthier. All of this influences that we are able to maintain a very dynamic pace of development.

Thank you.