For lack of courage or funding, most local entrepreneurs, either big or small, have kept their businesses ‘anchored’ in Romania. They are seeing revenue of millions or even tens or hundreds of millions of euros on their home market and bet on knowing Romanian consumers very well. Few are those that took the courage to expand abroad and develop their `made in Romania` brand into an international one. There are some exceptions, though, with brands like Dacia and Bitdefender having already established a presence in various parts of the world.
When it comes to retail, there are only a handful of brands with an international presence. However, more and more entrepreneurs have announced plans or even taken steps to go abroad in the past few years. Most of them kept to the region, to ensure a better control over the business.
The latest projects were completed this year, when footwear retailer Otter and fashion retailer Nissa opened stores abroad. Otter Distribution, one of the biggest local footwear retailers, whose brands include Otter, Clarks and Aldo, opened its first stores abroad, using the Tezyo brand in Austria and Czech Republic.
Unlike the fashion market, companies competing on the footwear market are both local and international. The former are strong, at the top of the market. The most important of them are Musette, Denis, Il Passo, Benvenuti and Otter Distribution. Benvenuti is the only one of them that has yet to announce plans to expand abroad. Il Passo announced it will first expand online and then offline in the capital cities of the neighboring countries. Denis, which has both retail and manufacturing operations, has been present in Ukraine for five years.
The first to take the courage to go abroad was Musette, a company with a manufacturing and retail business model. It is now present in Austria, Israel, Hungary and Bulgaria after having closed stores in countries farther away like Lebanon, Mongolia and the US, operated by franchisees.
ZF’s analysis took into account only the companies that expanded abroad with single-brand stores, either on their own or via franchisees.
Most such retailers operate in the footwear business, followed by fashion and cosmetics.
Nissa, a Romanian fashion family business has recently entered the Polish market with its first single-brand store in Arkadia shopping center in Warsaw. PPT Preturi Pentru Tine (Prices For You) expanded to Bulgaria and the Republic of Moldova last year. Its strategy is to move a high volume of merchandise at low prices so it has already grown to 35 stores in Bulgaria and the Republic of Moldova, ZF has found.
Other brands that expanded abroad were lingerie retailer Jolidon and footwear retailer Leonardo, each of them with tens of stores across Europe. The crisis, the financial problems and then insolvency caused them to close all stores abroad. Meanwhile, Leonardo went bankrupt and closed its local stores, as well. Jolidon only has 60 local stores left, according to its corporate website.
Cluj-based Farmec, a cosmetics producer and retailer and one of the oldest Romanian brands, has eight stores abroad, all of them operated by franchisees and continues expansion through partners.
The decisions of the Romanian brands to go abroad follow a tried and tested model by companies in other countries in the region. Names like LLP (Reserved, Cropp and Sinsay) and CCC, based in Poland, are already major players in Romania and in the region.
(English version by Loredana Fratila-Cristescu)