“We have double-digit openings planned, that is ten or more stores,” said Sorana Georgia, chief executive of Billa Romania, who was appointed to the position last summer. She did not provide any details about the location of the new stores or about the investments required.
According to previous information from Sorana Georgia, if a store takes up less than 1,000 square meters, then the investment is lower than EUR2 million, otherwise, the investment is somewhere in the neighborhood of this amount. Under the circumstances, investments in stores should reach EUR15 to EUR20 million, ZF has calculated.
Sorana Georgia, the only Romanian female chief executive of one of the 13 companies in the modern retail sector of the country has also previously said that the money will come from the parent company and not from banks. The Rewe group, which owns both retail and travel companies, has cash available after selling its stake in the Selgros cash&carry chain to the Swiss-held Coop at the end of 2010. The German group owns Billa and discounter chain Penny Market, the second largest modern retail network (128 stores) on the local market.
The opening of new stores may be a sign that retailers are expecting consumer spending to rebound soon or an attempt on their part to keep their business at similar levels to the boom period. Consumer spending went down for three years and showed first signs of growth in the fourth quarter of 2011, which means this indicator might return to growth.
Billa is not the only chain to have announced aggressive expansion plans for the near future. German discount chain Lidl aims to have 200 stores operational in Romania by yearend, which would mean 71 new openings. Profi announced plans for 25 stores, and Mega Image will open about 80, market sources said.
(English version by Loredana Frățilă-Cristescu)