He thus expects both the furniture market and the business he runs to register growth in 2014.
“I expect 2014 to no longer bring contractions in our industry, while 2013 was a year of declines. We see the business advancing by 5% or 6% overall, with the positive trend mainly visible in the second half of the year,” Sucu told ZF in an interview.
The year 2013 was the fifth in a row when sales of furniture shrank domestically, amid the falling purchasing power.
“There are two main obstacles in the way of consumer spending resumption from my point of view. Both are related to a monopolist approach, from the part of banks and the government,” Sucu said.
The businessman, who owns a network of 32 stores and hyperstores and nine furniture plants, has repeatedly criticized the banks and Romania’s central bank. He believes banks starting to resume lending now is not a coincidence. They are interested in resuming the economic cycle and the central bank’s rate cuts that helped bring the cost of leu loans down close to cost of euro loans are confirming it, he added.
When consumers fare better, they primarily dress better, then change their car and only then think of refurbishing and this is why the furniture and home décor market is the last to exit the crisis, though the first to enter it, Sucu also said.
“We’re all thinking of improved business now. Which means that we should either operate at higher capacities on the production side, or increase the retail space. In retail, we’re paying more attention to the changes that online sales bring on the market,” said Mobexpert owner.
Thus, Mobexpert’s priority in 2014 is to spur online sales. For the next three years, Sucu wants online sales to generate 10% of the revenue registered on the home décor segment.
In 2012, Mobexpert reached revenue of almost EUR115 million (RON510 million) and last year revenue rose by 4% (in lei), to EUR120 million, according to ZF estimates. The group’s revenue peaked in 2008, and then slid in 2009 and 2010 before going up again.
The turnaround came amid a change of strategy, according to Sucu, as more space was allocated to accessories in stores.
“The increase comes from our decision to turn from a furniture into a lifestyle retailer and become a destination for everything that means home décor,” said Sucu.
In terms of profitability, Sucu says this is “minimal” compared with what he was used to, but the fact that it exists makes him somewhat relaxed and confirms he is going in the right direction.
Mobexpert operates four stores in Bucharest. According to Sucu, Bucharest sales did not go down last year. The store in Iasi (NE Romania) is the best outside the capital city.
“We’re still unhappy we do not have a bigger store in Constanta and we’re working hard on this. Constanta is still Romania’s second largest market after Bucharest”.
(English version by Catalina Apostoiu)