Alexandru Vlad, chief executive of Selgros Cash&Carry, says that he is involved in talks over the acquisition of several plots of land. If these talks come through, the chain could open at least one store next year.
“We are willing to open new stores, but we must find suitable land, at prices we can pay, in cities where we are not present yet,” Vlad says. Selgros currently has 19 stores, the last of which opened in Constanta in 2011, in a city where it already had a unit.
Last year, the company posted revenue of EUR802 million, up 5% on the year. For 2012, revenues are seen flat, Vlad says.
“We haven’t seen a consumer spending rebound and there are no signals it will improve any time soon.”
Vlad is one of the few Romanians running a multinational company in the trade business, with more than 4,000 employees.
In Romania’s retail sector, Selgros is one of the most cautious companies, having expanded very carefully since entering the market. In the last three years of the crisis, the cash & carry chain opened only two stores, one in 2009 and one in December last year. This year, it put expansion on hold, and might resume it in 2013, depending on the result of negotiations over land acquisition.
“We have not bought any land yet, but are negotiating it. Under the circumstances, we may open more than one store next year, but we cannot say how many before we know the result of the talks,” says Vlad.
A typical Selgros store requires up to EUR20 million investments and the floor space is about 10,000 square maters. Vlad had previously said Selgros should grow to 21 stores to serve the whole country.
The company, controlled by Swiss giant Coop, might expand to other formats, though. The parent company operates on international markets with all store types from supermarkets and hypermarkets to convenience stores. “We’re thinking of entering other segments, as well, but the decision will be made at the headquarters.”
Selgros could therefore follow in the footsteps of Carrefour, which first introduced hypermarkets in Romania and then expanded to supermarkets (Carrefour Market) and convenience stores (Carrefour Express). The French-held group already has more than 80 stores operational, and recorded over EUR1.1 billion in revenue last year.
(English version by Loredana Fratila-Cristescu)