Each Romanian therefore spends EUR7 to EUR8 on Ariel, Dero, Bonux, Tide or Persil in a store on a detergent market dominated by world giants like P&G, Unilever and Henkel.
The local market is still underdeveloped, especially if compared with Western markets or markets in the region. One of the most important indicators of its development is the washing machine penetration rate, 70%.
Home appliances manufacturer Indesit Romania head Giuseppe Parma said a few months ago that the penetration rate of refrigerators and stoves in Romania was 90%, while washing machines’ was 70%, among the lowest in the region.
He also said that Romania would catch up with countries like Poland, Hungary and Czech Republic in ten years and explained the low penetration of washing machines was also because many homes do not have running water. Until they do, many households will not be able to use a washing machine.
There are 7.1 million households in Romania and about five million washing machines. The large home appliances market is still in the “buy out of need” stage, which means households most often buy a new product only to replace something that broke down, particularly in the last few years of difficult economy.
Developed Western European countries such as Germany no longer include washing machine or refrigerator penetration rates in their statistics, because all households already own such products.
The local detergent market is therefore driven by the relatively high number of people washing by hand, especially in rural areas.
“The detergent market is estimated at about EUR170 million in 2011,” says Bogdan Toacse, marketing manager with Household Care division of Unilever, whose brands include Dero, Omo, Coccolino, Cif and Domestos. Dero and Omo are Unilever’s detergent brands for Romanian consumers.
“Dero is the detergent with the highest number of users, according to GfK Brand Indices 2011 and has been the leader of the detergent market by volume in Romania for many years. One in three detergent packs sold in Romania is a Dero,” Bogdan Toacse added.
He says the launch of new Dero products and improvement of the already existing ones have made a significant contribution to the increase in the brand’s sales in 2012, but would not reveal any figures.
Unilever, the second largest fast moving consumer goods company in Romania ended the year with EUR186 million in revenue, slightly lower than in 2010. Its local portfolio includes both foods and non-foods.
Its most important competitors on the local detergent market are P&G (Ariel, Tide and Bonux) and Henkel (Persil, Perwoll and Rex). A smaller rival is Greek-owned Interstar Chim, better known for its Bio Carpet and Rivex products. Its portfolio, however, includes liquid laundry detergent brand Evrika.
Detergents accounted for 1% of Interstar Chim’s sales in Romania in the first nine months of 2012, said its commercial manager Kostas Fidanikis.
Interstar Chim expects more than 100 million lei (EUR22 million) in revenue this year, which would make 2012 its best on this market.
Kostas Fidanikis says that according to the data his company has, Romanians spent EUR131 million on powder laundry detergent and EUR11 million on liquid detergent from July-August 2010 through May-June 2011.
Latest to enter the market are three Romanian investors who built a liquid detergent plant in Prahova County (southern Romania), in an investment set to amount to about EUR1 million by yearend. Their got EU funding for their project and are already selling their Dolfy and Euro products to more than 1,200 stores, as well as a number of hotels and restaurants in Romania. Theirs’ is one of the few local investments in this business, clearly dominated by foreign companies.
(English version by Loredana Fratila-Cristescu)