The German company, present only in the states of ECE and Germany, entered the local market in 2007, after having tested the business model in the Czech Republic, Hungary or Poland.
Locally, the network entered with a store in Timisoara, and then expanded in the rest of the country. With a 68-store network at present, dm drogerie markt plans to expand further and tackle the northeastern area of the country.
“At the end of this year, we will open our first store of Bacau, with which we will also cover a part of Romania’s northeastern area,” says Milan Radin, the general manager of drogerie markt Romania.
On the local market, the company opened 10-15 units, either in malls and shopping centers, or in street-front locations. There were also store shutdowns, but the company’s officials would not offer data in this regard.
“Our plans for this yearend and 2015 are not different from those of previous years. Romania is a large country with many large and interesting cities,” adds Radin.
Investments per store amount to around EUR500,000, according to ZF’s latest data.
The company increased its revenue by over 26% in the last financial year (January-December 2013), to 155.6 million lei (EUR35 million), but it’s still loss-making, with a negative figure of almost RON15 million.
The company was loss-making each year since it entered the local market, but losses narrowed by 20% last year.
During the crisis, in a period when consumers were ever more price aware, dm drogerie markt, just like food retailers, bet on private labels. Milan Radin does not specify how much own labels Balea, babylove or Denk Mit weigh in the company’s sales.
(English version by Catalina Apostoiu)