Focus on Bucharest, introduction of a new brand for stores smaller than 600 square metres, and an emphasis on fresh products – these are the goals of the Belgian Delhaize Group’s new strategy for the Mega Image supermarket chain, which it now owns 100%.
“Delhaize became a Mega Image shareholder in 2000, and has increased its interest every year since then. We gradually moved to 70%, with Delhaize now owning 100% in Mega Image,” stated John Kyritsis, the new chief executive of the chain.
Kyritsis is the first official from the Belgian group to become chief executive of the Mega Image chain, a position previously filled by the former Greek shareholders that founded the company in 1994.
“After the takeover of the controlling interests, we gradually increased our involvement in the operations of Mega Image, with the last adjustments made last year and earlier this year,” Kyritsis explained.
The restructuring of the business by Delhaize, which dropped some of Mega Image’s assets, caused the supermarket chain to end the year with nearly 1.3 million euros in losses, according to the Finance Ministry data, after having turned in profits for the preceding two years.
“We made operating profits last year and will revert to an overall profit this year, particularly because our sales rose 14% in ROL in the first few months of this year,” Kyritsis added.
Mega Image had a turnover of more than 46 million euros last year.
“We will reach a total of almost 48 million euros this year and will see turnover increase to 50-52 million euros in 2005,” said the Mega Image chief executive.
At present, Mega Image has 16 supermarkets, 14 of which are in Bucharest, with further stores in Ploiesti and Constanta.
“We have decided only to focus on Bucharest for the near future. Bucharest has significant potential and we have secured the funding for opening stores. However, the speed at which we will open will be dictated by the space we find. We are interested in both 1,000-1,500 square metre stores, as well as smaller stores of 500-600 square metres. In fact, this year we decided to launch a special brand for stores smaller than 600 square metres. It is called Mega Image City and the first such store was opened in the Eminescu area of Bucharest early this year,” continued Kyritsis, who estimates Mega Image could reach between 30 and 35 stores in Romanian in the medium term.
“We will not drop the Mega Image brand. It was one of the first supermarket chains in Romania and enjoys high brand awareness locally. However, our stores will have a change of image so that there is reference to the brand being part of the Delhaize Group,” concluded Kyritsis. ionut.bonoiu@zf.ro