1. Anticipation of moderate market growth. The outlook for LFL is positive. Growth in the market will require a significant improvement in the customer value proposition.

2. Customer income remains limited, but customers are becoming more demanding. Price remains an important factor for customers when picking retail store locations together with better quality and service.

3. The race for retail space continues. Even though the proportion of modern retail is growing, the market from greenfield investment remains unconsolidated. It is important to note that in many cases growth does not come from greenfield, but through the replacement of previous retailers. In 2018, 70% of Magnit’s store openings took place at an existing retail location.

4. Efficient operations and cost-management play an increasing role. Moderate growth along with a high level of competition exert additional pressures on the Company’s margin.

5. Digital technologies are changing all the components in the value chain of the value chain: the use of all possible channels to interact with customers, analysis of big data on customers, and automated and digital operations.