After having conquered hypermarket, supermarket, fragrance shop chains, as well as local restaurants and coffee shops, L’Oreal, Nestle and Tchibo have taken the first steps towards their own stores.
Foreign manufacturers are therefore implementing a model that Romanian producers like Betty Ice (ice cream) and Lactag (dairy) have already tested. The two first secured a presence in retail chains and in the hotel, restaurant and catering sector then decided to expand in the retail sector with their own brand of stores.
L’Oreal decided to introduce a new brand in Romania, Kiehl’s, which became available only when the company opened a monobrand store. Tchibo and Nestle, on the other hand, are betting on brands already present in Romania, either via distributors or directly and as such known to Romanian consumers.
The latest to enter domestic retail is Swiss-held Nestle, one of the leading actors of the local coffee and sweets market. It will open a Nespresso store on Calea Dorobantilor in downtown Bucharest this summer. The company has more than 400 boutiques operating under this brand in 258 cities in 55 countries. The new Nespresso stores will operate near luxury stores such as Brunello Cucinelli, Canali and Moschino.
“A store like Nespresso was needed in Romaina, as the brand has a loyal customer base in this country. Nestle deciding to enter the retail market with this store shows the market has potential,” says Oana Iliescu, managing director of real estate consultant DTZ Echinox.
Nespresso is the second company in the coffee business after Tchibo to open a store. The two, however, do not have the same target. Nespresso will sell coffee pods, coffee machines and accessories for average and above-average income customers.
The Tchibo store opened in Promenada mall in the fall of 2013 sells coffee, apparel and footwear, as well as bathroom and kitchen items and decorations. The company applies this business model in other countries, as well, and puts its stores in areas with heavy traffic such a malls, train stations and pedestrian streets.
The same kind of locations is exactly what cosmetics company L’Oreal seeks for the US premium cosmetics products brand Kiehl’s. It opened the first Kiehl’s in AFI Palace Cotroceni, next to cosmetics retailer Douglas on the ground floor. It plans to expand and is looking for suitable space in malls and street front areas with significant traffic.
(English version by Loredana Fratila-Cristescu)