Rethinking retail formats: How Auchan and Lidl are adapting to a changing market

Once the symbol of modern retail, the hypermarket model in France is being fundamentally rethought. With non-food sales in steady decline and shoppers adopting more purpose-driven, value-conscious behaviours, major players like Auchan and Lidl are redesigning their store formats, either by shrinking their assortments or adapting to new urban realities.

For decades, hypermarkets thrived by offering food, apparel, appliances, and more in a single location. But that model is eroding. At Carrefour, non-food sales dropped by -6% in value in 2024, driven by category fragmentation and the rise of discount specialists such as Action and Normal. Auchan, facing structural difficulties, reported a -4.7% decline in like-for-like revenue in France the same year. Consumers are no longer treating the hypermarket as a one-stop destination. Instead, they’re shopping more selectively, often online or in discount chains.

In response, Auchan has launched a bold transformation. The group plans to reduce the sales area of 77 of its 119 French hypermarkets by an average of 25% by 2027, without reducing the store footprint. The idea is to maintain the hypermarket format but reorganize the space to look and function more like a large-format supermarket. This means a smaller non-food section, an expanded food assortment, clearer signage, and a simplified shopping experience. Pilot stores in Mandelieu and Fréjus (south of France), inspired by Auchan’s model in Cascais, Portugal, are already testing this approach. For Auchan, this strategy is not only about shopper experience but also about efficiency, surface profitability, and relevance in a market where loyalty is increasingly hard-won.

Lidl is also exploring how to adapt to more constrained urban spaces. In Versailles-Chantiers, near Paris, the retailer opened a 654 m² store (half the size of a standard Lidl) with a one-way shopping path and 100% self-checkout. The store is located inside a mixed-use building called “La Biosphère,” which also houses a Basic-Fit gym upstairs. However, the two operate independently. This atypical setup reflects Lidl’s ability to flex its format to fit high-traffic zones with space limitations. While this is not officially presented as a strategic shift, Lidl representatives describe it as “putting a foot in the door” of new urban models : an experiment that could inform future openings depending on performance.

These two retailers are reacting to the same market shift: the end of the “everything, everywhere” retail promise. Instead, they’re betting on strategic focus, whether that’s a renewed commitment to food, more compact layouts, or collaborative spaces that add value beyond product. Hypermarkets may not disappear anytime soon, but they are being fundamentally redefined.

The big question now: will these revised formats be enough to restore foot traffic and margins, or are we witnessing a transition toward an entirely new kind of retail?

To get in touch with our France team