When we Spaniards go out to shop we value two factors above all. The first, proximity. The second, the Price. Even above the quality. It is not surprising at all if we take into account that we are coming from an inflationary crisis and there are commonly consumed items (cocoa, coffee or eggs) that have experienced a real storm in recent months. The chains know how much they are risking with each euro and have acted accordingly. For example with a commitment to white label that has been especially good for Mercadona.
There is, however, another strategy that has been gradually making its way into the world. retail Spanish, one also focused on prices, but that does not rely on white label or short assortment: the “ultra low cost“.
¿”Ultra low cost“? Exact. It sounds somewhat far-fetched (almost, almost cacophonous) but that is the label that best defines certain supermarket chains that have focused their strategy basically on double-digit discounts.
After years of inflation and with costs becoming a decisive factor when families decide where they shop, most chains try (to a greater or lesser extent) to be competitive in prices. In fact, brands such as Alcampo, Family Cash or Aldi usually appear in the rankings of the cheapest stores.
In the case of super “ultra low cost“The price is, however, more than just a front on which to compete. It represents the great differentiating factor. And it is to such an extent that it conditions the approach, the offer and the way the chain operates. In a recent article, Five Days reviewed the billing data of two relatively young firms that fit this pattern: Sqrups and Primaprix.
What differentiates them? That in a sector (that of supermarkets) in which it seemed that everything was said, with Mercadona expanding its dominance and the private label gaining market share, the “ultra low cost“have found an alternative growth path. Their strategy involves offering items from recognized brands (nothing from Hacendado, Deliplus, Auchan or similar), but with surprisingly low prices. As an example, Sqrups boasts of offering its customers “significant discounts” that range between 30 and 80%.
How do they work the miracle? With your business model. More like its supply model. Unlike most supermarket chains, they supply surpluses that are left ‘off the hook’ or have no place on the shelves of companies such as Carrefour, Eroski, Mercadona or Hipercor, among others.
These are surplus stocks, items that do not quite work, merchandise that has been left out of the circuit due to a change in packaging or not meeting presentation standards… In short, items in good condition that manufacturers need to liquidate and cannot (or want) to distribute through ‘conventional’ chains. Their destination ends up being Sgrups or Primaprix, where they add to a catalog marked by rotation, speed and discounts.
But… How do they do it? “Large international brands usually have surplus stocks in their warehouses, left over from promotions (Christmas, summer, events…), from new launches or simply products with a much lower price in one country than in another. At Primaprix we travel throughout Europe hunting for these opportunities,” details the company, which recalls that it opened its first store in Madrid in 2015 and in just ten years it has built a network of 260.
Sgrups’ explanation is similar. “We recover products that, under normal conditions, distribution throws away,” explains its general director, Raúl Espinosa, who boasts that thanks to its discounts the chain sells products with prices much lower (50-80%) than those on the market. The company ensures that its assortment comes from three sources: “production surpluses, image changes and quality control.” It also incorporates “short-dated” products.
“In the last year we have rescued more than 26 million products, preventing them from ending up destroyed and giving them a second opportunity for consumption,” says the company, founded a little more than a decade ago and which works with food, but also drugstores, stationery and hygiene items.
The big question: why? Because this formula has allowed them to connect with a part of the market and expand in a sector, that of retail Spanish, in which a small number of brands have been expanding their dominance.
“Companies like Sqrups or Primaprix break the differentiation with the rest of the operators thanks to this supply model,” he explains to Five Days Javier Pérez de Leza, good knowledge of the sector. “Mercadona, Lidl or Aldi have dedicated themselves to a type of discount that leaves room below, because the price trend is upward. You can be much cheaper than all of them, although with risks.”
What risks? One (fundamental) is the pressure that operators in the sector can exert to reduce the surpluses that these chains feed on, although it is not the only limit that the model of companies like Primaprix faces. Relying on stocks makes it very difficult to guarantee the continuity of an ever-changing assortment. Furthermore, the fact that customers encounter different products every so often may increase their interest in visiting stores but also complicates such basic issues as logistics.
What do your accounts say? That neither of the two chains are doing badly at all. We also know the Primaprix data thanks to Five Dayswhich a few days ago revealed that during the 2024 financial year the company had a turnover of 347 million euros. It may be far from Mercadona’s billions, but it represents a year-on-year growth of 24%. If we look further back, the company’s sales quadrupled between 2020 and 2024, a period during which it went from managing 110 stores to 245. It is now on its way to 300 stores.
The key: its business model, which is nourished by the surpluses accumulated in the warehouses of large manufacturers. Your catalog is completed with purchases you make in other countries, looking at prices, discarded items despite being completely suitable for consumption, or products that will expire soon.
A bet not very different from what fashion or furniture outlets have been making for years. They are merchandise (many from top brands) in perfect condition, but for one reason or another we do not see them on the shelves of other chains with greater implementation. At Primaprix they find prices that are significantly lower (49, 55, 87%…) than the rest of the market.
And in the case of Sqrups? It has also experienced considerable growth, although its data is somewhat more modest. In 2025, the company had a turnover of 29.5 million, 34% more than the previous year, and its store network went from 51 to 121 in a matter of four years. Its general director, Raúl Espinosa, recently highlighted that one of the keys to its success is high turnover.
“The average value of each product we sell is 80 cents. And the average ticket is 4.8 euros. We make millions of transactions,” he reveals. The model is not exactly the same as Primaprix. Both work with large external manufacturers and focus their efforts on prices, but among other peculiarities, Sqrups bases its assortment on the manufacturers’ surplus merchandise, so its catalog may vary. Primaprix is more committed to a stable assortment.
Images | Sqrups Spain 1 and 2 and Primaprix
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