BDG Import, one of the largest importers of alcoholic beverages domestically, in the first half of this year cut costs by around 10% in RON compared with the same period of last year to more easily cope with the financial crisis fallout.
Still, net income is just 15% of the level reported for the first six months of 2008 in the wake of discounts and RON decline.
Pepe Berciu, BDG Import shareholder and general manager, maintains that cost reduction in the case of an alcoholic beverages importer mainly includes three stages. The first stage entails identification of costs related to external suppliers' services and cutting them through negotiation and adjustment to the new market conditions. In the second stage, the main activities and processes are analysed and steps are taken to boost their efficiency particularly by reducing the weight of fixed expenses and adjusting them to the new activity volume.
The third step importers take in order to cut costs entails headcount reduction, but it is used only in case the cumulated effects of the first stages are not enough, according to BDG manager.
"The structure and number of BDG personnel have remained unchanged from the end of 2008. The company's performance in the first half of this year has not pushed for such a move so far," Berciu says.
BDG Import posted turnover worth 47.4m RON (11.3m euros) in the first half of 2009, down 4.6% in RON from a year ago. In the same period, the company derived net income worth 660,000 RON (157,000 euros).
"The profit decline came amid the unfavourable foreign exchange rate differences posted in the first half of 2009 and the falling sales and commercial margin in the wake of sales volume decrease on the one hand and on the other hand amid the efforts to generate them through discounts and additional packages granted to clients," explained BDG manager.
In the wake of these cost cuts and some portfolio changes, Berciu expects to achieve 80m RON turnover in the second half, almost double the first half level.
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