Action: Discount store operating in mainland Europe. Sells non-food items at wholesale prices, marketing itself on the constantly-changing products available in-store.
They earn smaller gross margins than traditional players do, but their business models turn those into higher operating margins. Those operating margins are magnified by the businesses’ higher-than-average asset turnover ratios, which bring about impressive returns on assets. Due to those returns and high growth rates, the marketplace capitalizations of several upstarts are greater than…
