In the fall of 2011, Leroy Merlin opened a sizeable store, with a commercial area of 16,500 square meters. This was a “pilot project” and the company’s expansion rate was supposed to be decided based on the results of this store.
“In three months we will have a clear approach: we will either go full speed ahead and open 4-5 more stores in Bucharest, or we will further examine the market,” Cristi Petrescu, development manager of Leroy Merlin Romania, said in September 2011.
The store’s sales last year were almost double compared to the sector’s average per store, but Leroy Merlin’s local unit is also much larger than its competitors’ stores.
According to a ZF analysis, the highest sales per store in the DIY sector were recorded by Hornbach last year, of EUR20 million, while Dedeman had an average turnover of EUR18.8 million per store. The market average was EUR11.2 million, 3.5% lower than in the preceding year.
Trade Registry data reveal that Leroy Merlin Bricolaj recorded gross loss of EUR6.9 million last year and employed 192 people.
Leroy Merlin had not commented on the results by deadline.
The French company plans to open its second local store next year in Craiova.
The DIY and construction materials distribution market remains tough and this is visible both in the evolution of sales per store and in the appetite for expansion of companies in the sector. The only company that has continued investments in expansion this year is Dedeman, which opened three stores and has scheduled two more openings by the end of the year.
Leroy Merlin is, alongside Auchan, Decathlon and other retail chains, part of the Adeo group controlled by the Mulliez family in France. Leroy Merlin is present in 13 countries with a chain of over 300 stores. At European level Leroy Merlin’s main rival is UK chain Kingfisher, which this year entered the Romanian market by buying the Bricostore store network.
(English version by Daniela Stoican)