The growth of 10% was because of a “good pricing strategy”, as Hornbach Romania chief executive Mugurel-Horia Rusu said, and of the completion of a EUR30 million investment in a new store in Timisoara (west of the country), the company’s fifth in Romania.
Under the circumstances, Hornbach’s revenue may come close to EUR100 million this year, after reaching EUR84.6 million in 2011.
Hornbach Romania CEO said his expectations about the sales trend are positive. Hornbach has three stores in Bucharest and around it and one in Brasov and Timisoara each, which required about EUR150 million investments.
German-held Hornbach operates the largest store format in Romania, and has the highest sales per store, about EUR21.2 million in 2011, according to ZF’s calculations.
However, the company chose to expand cautiously, which is why its network is one of the smallest in the local DIY business. Rivals Dedeman, Praktiker, BauMax and Bricostore have almost 90 stores together and sales close to EUR1 billion this year.
Whereas some of its competitors went to cities of less than 100,000 inhabitants, Hornbach only plans to reach the six or seven largest cities of the country for the time being.
“I can tell you that we are now targeting cities with more than 300,000 inhabitants likely to generate the level of revenue we need to match the investments made. Our list includes cities like Cluj, Constanta, Craiova and Iasi without ruling out eastern Bucharest,” Mugurel-Horia Rusu said.
The decline of the construction market during the crisis led to a slow down of expansion pace among DIY retailers, with only six new stores opened this year after almost EUR100 million investments.
DIY retailers in Romania also include OBI, Mr. Bricolage and Leroy Merlin.
(English version by Loredana Fratila-Cristescu)