December, best month for home appliance retailers

The top three electrical home appliances retailers on the domestic market, Altex, Domo and Flamingo, expect to generate sales worth 140m euros in December.
In January, the retailers announced that 20-25% of the budget set for the entire year depends on sales registered December, in other words on consumers’ appetite at the end of the year.
On a market estimated at 1bn euros, the top three retailers budgeted cumulated turnovers worth 670m euros this year and resumed growth after 2006 brought the first declines on the electronics and electrical home appliances segment. According to the forecasts made by Altex Impex, Domo Retail and Flamingo International, sales are expected to amount to almost 140m euros in December.
Flamingo estimates to generate 20% of its annual sales budget in December, namely 35m euros, as well as half of its income.
Altex (the segment leader) expects the last month of the year to bring sales of up to 25% of the total 300m euros budgeted for 2007. As a result, the company’s 90,000-sqm commercial network will derive sales worth 75m euros in December.
In order to derive higher revenues during certain periods of frenzied consumption, employees often work extended hours, whilst in some cases additional employees are recruited.
“In December, employees can work ten hours a day instead of eight. However, this is not mandatory, whilst sometimes we hire temporary workers,” stated Dragos Simion, deputy chairman at Flamingo International.
Representatives of Domo Retail (ranked second on the market) say they have extended their opening hours, which have been adjusted to meet shopping centres’ opening hours, whilst in some cases stores stay open around the clock.
In the case of Domo, December sales are likely to reach 35m euros, according to ZF estimates based on the company’s 9-month figures (125m euros) and Domo’s target for 2007 (200m euros).
Whilst the level of turnovers generated by the top 3 players is expected to advance by over 40% in 2007 year-on-year, in terms of profitability their performance is not as spectacular. Out of the top three, Domo Retail was the only retailer that specialises in electrical home appliances that stayed in the black.