“We opened six stores in 2019, slightly fewer than in the previous year when we opened seven, but much higher than in the years before 2018. We did not close any stores in 2019, either,” says Catalin Pozdarie, the executive who has been running Hervis Romania’s operations for more than a decade.
The retailer had initially announced it planned to open 10 stores in 2019 but eventually opened fewer. The number of stores opened can be influenced by a number of factors among which the construction permits for the companies developing stores from scratch to openings of malls and retail parks for those that choose to rent store space.
Hervis set out to expand faster in 2020, which means it plans again to open 10 stores. The network currently numbers 36 stores, seven of which in Bucharest, the city with the highest purchasing power and the lowest unemployment rate.
Hervis arrived in Romania in 2007, during the economic boom days, with big plans for expansion. The crisis made it change its mind.
With the economy and consumer spending returning to growth in the last few years, companies, Hervis included, resumed investments.
The rise in consumer spending by more than 10% in 2016 and 2017 and by more than 5% in 2018 and 2019 led to the increase in purchasing power. Coupled with the fact that more and more Romanians, especially those in cities, are exercising, it gave a boost to expansion of sporting goods retailers.
Under the circumstances, Hervis’ sales in Romania rose to almost 250 million lei (EUR52 million) in 2019, according to ZF’s calculations based on the data announced by the company.
“2019 was the best year ever for Hervis Sports Romania, with the sales going up 21%. This is because of expansion, rise in consumer spending and last but not least the rising interest in exercise that younger generation has.”
He is not that optimistic about 2020 and expects a drop in consumer spending.
“2020 will come with stagnation, maybe even a decline in consumer spending due to the economic growth slowdown, as a result of uncertainty and even a decline of the major European economies.”(EUR1=RON4.7788)
(English version by Loredana Fratila-Cristescu)