On a market that may go beyond 250 million euros this year, cosmetics retailers are aggressively expanding in Bucharest and in other cities.
Ina International, which controls the Ina Center and Privilege store network, the biggest in Romania, budgeted turnover worth up to 13 million euros for 2006, 25% higher than in 2005, stated Eugen Bartha, general manager of the firm.
This forecast, he says, is based on the opening of four or five new shops in Bucharest, Constanta and Cluj-Napoca. Ina Center and Privilege stores sell luxury cosmetics. Ina International currently owns 40 stores, of which 15 are in Bucharest.
"We want to hold stores in Carrefour Constanta, Cora Cluj, as well as in Mall Cotroceni Bucharest, for instance," specifies Bartha. To this end, more than one million euros will be invested, that is approximately 300,000 euros per store. Bartha says the company''s strategy will focus on expansion in large commercial centres.
"Commercial centres draw in more traffic than the central areas or independent stores," explains the representative of Ina International.
The company registered turnover standing at 10 million euros in 2005, 25% higher year-on-year.
The figure equalled the result the company had budgeted at the beginning of last year. According to Bartha, about 60-65% of turnover was derived from the perfumes market. Regarding cosmetics, he says, Romanian customers prefer cheaper ranges.
"Instead of paying 700,000 RON for a Thierry Mugler cream, for instance, they''d rather pay 200,000 for a different brand," says Bartha. Ina stores sell products of ranges such as Clarins, Kenzo, Gucci, Yves Saint Laurent, Chanel or Escada. Bartha says the Ina chain does not intend to enlarge its product portfolio any further.
The Romanian cosmetics market was estimated at 200-250 million euros in 2005, with an annual rate of growth of 10-15%, particularly due to the establishment of domestic branches by major international brands in the market.
"The market is not mature, yet. It will mature in five or six years, when the purchasing power also increases. Our target market is narrow," he added.
Bartha considers the luxury cosmetics sector is currently worth 15-20 million euros.
"Our company strategy is to develop organically by opening new stores and eliminating those that aren''t doing that well," says the Ina representative. The company opened two stores last year, one in Sinaia and one in Iasi.
At the same time, the store of Brasov may also be closed, after the recent opening of a Beauty Shop store and a Carrefour commercial centre in the area.
"We do not want to close stores, but competition has tightened," Bartha explains. andreea.groenendijk@zf.ro
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