The local DIY market put at EUR2 billion to EUR3 billion a year has witnessed a number of exits in the past few years, such as bauMax or Obi, but 2015 has been a more peaceful year in the sector, with retailers resuming expansion and those that made acquisitions in the past rebranding those stores.
However, the perception in the market is that consolidation is not over yet and will continue over the next few years. Meanwhile, the major players are opening new stores or rebranding them and announcing plans to hire of hundreds of people.
DIY market leader, Dedeman, owned by Romanian entrepreneurs Adrian and Dragos Paval, continued expansion in 2015 when it opened two new stores, one in Bucharest and one in Timisoara, for a total of 42 in the country.
Dedeman, which posted 3.4 billion lei (EUR764 million) revenue last year, intends to reach 50 stores within two years and two of the new stores will be opened in Bucharest, one in the north of the city next to the IKEA store and another in the east, near Cora Pantelimon. The company, which saw 30% increase in revenue in the first half plans to expand abroad, as well, after having taken the first step in the Republic of Moldova, where it has two plots of land on which it hopes to open stores next year.
German-held Hornbach, too, expanded in 2015, after having stopped opening new stores in 2012. It therefore grew to six stores in Romania this year, after having opened a store in Sibiu, in a location acquired from former rival Obi. Moreover, Hornbach is eying several potential locations for its seventh store and the next project might be launched in 2016.
Hornbach Romania posted RON479 million revenue last year and 10% growth in the first half of 2015.
Besides the opening of new stores built from scratch, 2015 also saw some store remodeling, following the takeovers in this business in the past few years.
UK’s Kingfisher completed putting Brico Depot logo on the 15 Bricostores it bought in 2013 this year and its officials say their long-term plans are to expand the network to 50 stores.
Bricostore Romania posted RON572 million revenue last year, 9% lower than in 2013 as some of its stores were closed for rebranding.
French-held Leroy Merlin continued the remodeling of the bauMax stores it bought in Romania last year, completing four such stores besides the opening of a newly built store in Bragadiru, near Bucharest.
Leroy Merlin plans to complete the rebranding of the acquired stores next fall so it should have 16 stores under its own brand by then. It has seven Leroy Merlin stores in Romania at the moment (three greenfield investments and four converted bauMax-es). It bought 15 bauMax stores last year but will only covert 13, after having closed two of them (Chitila and Pitesti).
Leroy Merlin Romania and Leroy Merlin Bricolaj posted RON181 million revenue together in 2013, while bauMax Romania posted RON517 million.
Another company on the DIY market is construction material distributor Arabesque of Romanian entrepreneur Cezar Rapotan, which has 34 stores and warehouses, 18 of which in Romania and the rest in Ukraine, Serbia, Bulgaria and the Republic of Moldova. The company posted RON1.8 billion revenue last year and ended the first half of 2015 with 5% higher sales. It expects the trend to continue for the rest of the year.
DIY retailer Praktiker, acquired by Turkish-born businessman Omer Susli in the first half of 2014, posted RON588 million revenue last year and more than 12% growth in the first quarter of 2015, according to the latest data available. The company has 28 stores at the moment and is considering expansion.
The year 2015 also witnessed the insolvency of construction supplies and DIY distributor Ambient Sibiu of businessman Ioan Ciolan. The company ended 2014 with RON497 million revenue and RON32 million losses. (EUR1=RON4.4523)
(English version by Loredana Fratila-Cristescu)