Rand Sherif, general manager of Interbrands, the biggest distribution company in Romania, says he had to cut down the number of warehouses from 34 to 24 to retain competitiveness.
“In distribution services, the less one touches the products, the better for producers (in terms of costs) and for consumers. A higher level of intermediation in distribution raises the risk that the products will no longer retain the initial quality, and this affects consumers,” says Rand Sherif.
The toughest decisions Rand Sherif has made as a manager were those to close certain warehouses that could no longer be used for economic reasons.
“In my opinion, decisions that entail making part of the staff redundant are always the toughest, irrespective of the domain one works in. Unfortunately, the competitiveness of the current economic environment is triggering such decisions,” Rand Sherif adds. The Romanian distribution services market is highly competitive and this will intensify in the future, once Romania joins the European Union.
“Competition is a threat and an opportunity at the same time, a healthy economic environment requires the presence of competition. Competition prompts a permanent self-assessment, makes one come up with ways to improve activities, which is beneficial both for oneself and for consumers,” commented Sherif.
The problems that Interbrands has to cope with on the Romanian market include dangerous traffic on the roads and the bad state of road infrastructure, especially during winter when the company”s vehicles are often blocked on the road for a prolonged period, interrupting the promptness of distribution.
“The smartest thing is to adapt, if you do not have the power to change things for the better,” concludes Rand Sherif.
Total investments Interbrands has made in Romania revolve around 25 million dollars, with financing provided by the company”s own resources and banking loans.
Interbrands last year derived turnover of above 607 million euros (2,201 million RON), up 37% from the previous year. Rand Sherif says this increase topped the growth figures projected by the company, but this year he expects the rate of growth to be slower than last year”s.
Interbrands is currently in talks with potential partners that could collaborate with the company as early as this year, which would considerably boost its turnover.