“There are several factors driving the turnover up. The determining ones are the role of the team and of the distributor network,” said Marius Vacaroiu, CEO of the Policolor-Orgachim group.
The group, with turnover of EUR80-90 million per year, consists of Romanian operations, conducted through Policolor, and Bulgarian ones through Orgachim. Policolor Romania last year had a turnover of around 124.3 million lei (EUR27.6 million), according to the Finance Ministry, and this year expects an around 10% turnover increase.
“It’s difficult to say [what the local economy will be like] when you have as inputs all the actions of the political world and the responses of the social environment. (…) We expect an economic stabilization in 2013, and more reasons to develop a more sizeable business in the coming years,” Vacaroiu says.
A stagnating EUR165 million market
The Policolor representative estimates the Romanian varnish and paint market will remain at the 2011 level of EUR165 million, with prospective monthly fluctuations being determined by the evolutions of the exchange rate. The varnish and paint market, similarly to the entire construction sector, has been significantly affected by the crisis period, and has basically halved as Romanians’ purchasing power was significantly reduced.
According to Vacaroiu, the factors that could drive the varnish and paint market up are a resumption of investments in construction at a faster pace, financing energy rehabilitation programs for old buildings, developing new real estate and industrial projects, as well as resuming lending to the retail market.
Plans to expand store network
Policolor has 20 distributors in Romania, through which it makes over half of its sales. Policolor’s products are also present in over 1,800 traditional retail stores, as well as in almost all DIY chains. The company has a chain of 7 stores of its own which it plans on expanding in the future. (EUR1=RON4.4898)
(English version by Daniela Stoican)