It was supposed to be a conquest of Germany, but it didn't work out. Pepco closes nearly half of its stores
In July, Pepco's German branch filed for bankruptcy. Now, according to Deutsche Welle, 28 stores of this chain, which is very popular in Poland, are to be closed.
Despite the closure of almost half of the branches, 36 Pepco stores in Germany will remain open. They have been assessed as “prospective” and will continue to operate.
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Bankruptcy and downsizing
Pepco Germany GmbH, the German subsidiary of the chain, announced its insolvency in July this year. An application for protection against creditors was filed with the district court in Berlin-Charlottenburg. The company cited operational losses and structural problems in its network as the main causes of financial difficulties.
The planned store closures and reductions in administration will affect 165 of approximately 500 employees in Germany. Employees affected by the restructuring will soon receive notice of termination.
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Expansion and competition on the market
Pepco, headquartered in Poland, began operations in 2013, initially focusing on Central and Eastern Europe. In the following years, the company expanded its presence to the markets of Austria, Italy, Spain, Greece and Germany. Two years ago, ambitious plans were announced to open 2,000 stores in Germany in the long term.
Pepco also recently got rid of the British Poundland chain, the acquisition of which can hardly be considered a financial success. Despite problems in Germany and Great Britain, it does not seem that anything will harm the Polish branch of the company, or the network as a whole.
Pepco's net profit for the first nine months of fiscal year 2025 amounted to EUR 196 million and has already reached the level of the full fiscal year 2024 (199 million euros).
Commenting on the results, Stephen Borchert, CEO of Pepco Group, said that the last 12 months have been a breakthrough for the company.
“We reformatted our strategy and began its rapid implementation. I am very pleased with the progress we have made in achieving key goals for this year in line with the strategy presented at the Investor Day in March 2025. We made it divestment from Poundland and we stopped offering FMCG goods (from Fast-Moving Consumer Goods – products purchased regularly, frequently and at relatively low prices – ed.) under the Pepco brand, which allowed us to achieve stronger growth and make tactical decisions to maximize shareholder value,” he said.
