Benvenuti boss: Price is still main purchase criterion

Benvenuti footwear and accessories retailer in 2010 boasted the best sales since the company’s set up, after turnover rose by 31% to 46.2 million lei (around EUR11 million) and the company stepped back into the black, according to Dan Pavel, the company’s founder and majority shareholder.

“There are several factors that led to this figure. Firstly, we noticed a rising appetite for footwear among Romanians. (…),” Dan Pavel says. He adds some internal measures were also adopted to bring Benvenuti back to growth. “Even though things have been improving for Benvenuti, I still believe this is a delicate period. I do not see the crisis chapter as being over”. However, the businessman expects turnover organic growth of 10-20% this year.

In 2009, to optimize the revenue/ expense ratio, Pavel cut personnel by 20% and slashed costs along all departments. Another internal move was to boost the procurement budget to the level of 2008, after a decline in 2009.

The businessman says he decided to trim the number of expensive products in stores and rely on medium-price products. “Expensive product demand plunged. For Romanians, price is still one of the main purchase criteria”.