Mobexpert, the biggest furniture retailer in Romania, plans to invest 32-33 million euros in five new furniture hypermarkets this year, in a return to large investments after not having opened any large stores last year. The new stores will be in Brasov, Ploiesti, Bucharest (Baneasa) and Constanta in Romania, and in Sofia in Bulgaria.
“Last year sales were weaker than expected and we halted our expansion plans. This year we have re-launched those plans thanks to better than expected sales,” said Dan Viorel Sucu, Mobexpert”s chairman.
The first of the five stores, Mobexpert Brasov, an 8,000 square metre project that had already been started, will be opened this autumn. Works for the other four -Ploiesti, Bucharest (Baneasa), Constanta and Sofia – will start this year and be completed next year. The company already owns the land for the stores and is now applying for the necessary consents and authorisations. The investment is part financed from the company”s own resources, with the rest coming from bank loans.
Mobexpert currently has three stores in Bucharest – Mobexpert Pipera (15,000 sqm), Mobexpert Militari (10,000 sqm) and Mobexpert Pantelimon (12,000 sqm). These are all situated inside shopping centres. It also has 20 other stores in other cities around Romania. The company”s strategy of placing its stores in shopping centres will be kept for the new projects.
“All Mobexpert stores will be located in shopping centres alongside other large stores like Carrefour, Cora, Bricostore and Media Galaxy,” said Sucu. The company has postponed the opening of its store in Belgrade by two years.
In the first four months of this year, the three Mobexpert stores in Bucharest saw their sales increase by 47% in euros compared to the same period last year. In the four cities outside Bucharest – Brasov, Timisoara, Constanta and Cluj – sales were around 40% higher.
“This year sales were unexpectedly high, which was a surprise even for us,” said Sucu. The main reason for the sales surge, he says, was the company”s price policy, which saw prices retained at the same level in euros, despite the single European currency”s depreciation against the ROL.
“Out of respect for our customers, we decided to follow the same price policy and keep prices in euros. This naturally brought us higher sales, though it eroded our profitability,” explained Sucu, who went on to say that the indicators for profitability did not grow as well as sales.
Another factor pushing sales up, he concluded, was the introduction of the flat tax rate, which raised available income and boosted demand for white goods. “I believe we are seeing the emergence of a real middle class.”