After operating via its franchisee for seven years, Ecco decided to buy the store chain of the entrepreneur in 2011 and kept Victor Tighinean, 45, to run the business in Romania, which it plans to expand. Tighinean supervises things from Cluj-Napoca.
“I started the business with my family when I was doing my residency. I had found a niche, hospital footwear. Then the business expanded with other brands, I opened the first shoe stores where I would sell only comfortable leather footwear,” Victor Tighinean recalls.
The motto that guided him at first and throughout the years is “One spends most of the time in bed or [walking around] in one’s shoes, so it’s worth investing in both.”
The company has the same motto today. Tighinean remembers that he did his research of the market and came to the conclusion that Denmark’s Ecco was the brand most compatible with his business but required too great an investment for him to afford at the time.
“It so happened that Ecco was looking for dealers in Romania then, as part of its global expansion strategy. One day someone from the Danish Embassy called me to schedule a meeting.”
Several meetings in Bucharest, Copenhagen and Tonder later, Ecco Romania started operations in 2004. The company has 15 mortar and brick stores and an online store and will open one more in Brasov by the end of the year, which is also its first in a street front location.
Ecco has opened stores only in the malls in Bucharest, Constanta, Iasi, Cluj-Napoca and Timisoara so far, as many other fashion and footwear retailers have. Romania is not a typical market, because most consumers prefer to go to a mall to do their shopping, where they can find parking space, food court and many stores.
The doctor turned entrepreneur and then executive says he has not closed any of the stores so far.
About 250 people on average walk into an Ecco store every day and the online store gets 2,000 visitors.
“About 10 to 15 of them in each store become Ecco customers. Average cash receipt stands at some RON500,” Victor Tighinean says.
“As the saying goes, we’re too poor to buy cheap. I think this is the reason that helped us increase [customer] spending and the number of customers even compared with 2008 (the last year of boom i.e.).”
This year has been an important year for Ecco, which turned 50. Ecco is one of the three largest footwear manufacturers in the world and was created by Karl Toosbuy in Denmark, who wanted to make the most comfortable shoes in the world.
The company has more than 1,200 stores in over 90 countries at the moment. It is also one of the four leading leather producers in the world, and makes almost all its footwear products in its own plants.
“Ecco Shoes Romania posted RON20.8 million revenue in 2012 and we expect an increase to RON24 million this year.”
Net profit stood at RON275,000 last year.
Victor Tighinean who now serves as Ecco Romania’s managing director says weather is the most important factor in the footwear business and “if weather is on our side” the company should see sales growth of at least 15% by yearend.
Local companies, be they manufacturers or retailers or holders of franchises of foreign brands, dominate the Romanian footwear market. More than half of the top ten companies in this business are Romanian-owned.
Romanians spent RON3.4 billion on footwear last year and should spend about the same in 2013, according to market research company Euromonitor, which estimates the market to reach RON3.63 billion by 2017.
(English version by Loredana Fratila-Cristescu)