Competitors have already taken over some of those stores and electronics and home appliances suppliers say they are still waiting for payment, so they stopped supplying products to the company that has been experiencing cash-flow problems for a number of years now.
The officials of Domo did not return ZF’s calls for comment by the time the story was ready for posting. According to the latest data available, Domo had about 75 brick-and-mortar stores and an online store this fall.
“Domo moved assets from one company to another. The former company operating Domo had cash-flow problems and stopped paying suppliers. The new entity made payments for a while and then problems started there, as well. We stopped supplying merchandise,” a supplier of the company said.
SC FAMILY HOME CONCEPT SRL (the former Domo Retail SRL), which had operated the computer and electronics store chain Domo until this spring filed for insolvency in September 2015. The company posted 612.5 million lei (EUR138 million) revenue in 2014, an increase of 5% on 2013 and more than RON70 million losses. It had more than 1,000 employees.
Domo Retail SRL operated the Domo retail chain until this summer when its name changed and the officials of the retailer announced they moved the ‘healthy’ operations to a different company. Domo representatives at the time said Domo SRL was the operator of the DOMO brand and the stores and it had no problem with its suppliers or customers. They did not say for how long they had been operating Domo SRL nor what was the business of Family Home Concept SRL (the former Domo Retail).
Domo’s problems started a number of years ago but things got worse recently after the name of the company was associated with Tvetan Vassilev, who was involved in a number of scandals in Bulgaria. The officials of the company neither confirmed nor denied the information ZF published eighteen months ago about him being the shareholder of the company. With the financial problems on in Bulgaria, the businessman stopped supporting Domo, which led to its current situation. Problems only got worse on a computer and electronics market that is rising in full gear, going over EUR2 billion last year for the first time after 2008. Competition includes specialist stores Altex and Flanco and online stores.
Officially, Domo has always been controlled by companies registered in Cyprus or other countries and its officials have never clearly said who their owners were.
Domo is one of the largest local computer and electronics retailers with a history of about two decades and was founded by a family of local entrepreneurs, Szarvadi. The business has changed hands since, going from its original owners to investment funds or foreign businesspeople.
It has been undergoing restructuring for about four years, during which it changed owners and management several times and closed more than 50 stores. Moreover, it has recently announced a new change of management, bringing new executives on board to run the financial, human resources, sales and marketing departments. The only constant is the chief executive officer, South-Korean Kim Koellner, appointed to this position in 2013. (EUR1=RON4.4412)
(English version by Loredana Fratila-Cristescu)