Drugstores close to hospitals derive highest revenues

Over half of Romania's drugstores generate annual sales of between 85,000 and 385,000 euros, according to ZF's calculations based on data provided by Cegedim Romania market research firm, with those deriving the highest revenues, sometimes as much as 2m euros a year, being located near hospitals.

In the case of large networks such as Sensiblu, Dona, Catena, Help Net or Centrofarm, annual average sales range between 400,000 and 700,000 euros, double the level of the rest of the market, according to ZF's calculations based on Romania's Business Yearbook information.

The average area of a drugstore in Romania stands at 70-80 square metres, so that annual average sales per square metre range between 1,100 and 5,100 euros. In the case of networks, average sales go between 5,300 and 9,300 euros per year per square metre. By comparison, in the case of a hypermarket of a foreign network, average annual sales per square metre revolve around 8,000 euros, while a retailer of electrical home appliances in 2008 saw sales of 3,000 euros per square metre on average.

"Networks generally have higher sales, but there are also smaller units that have gained their customers' loyalty in the past and people have got used to buying from those locations," said Dorin Catana, general manager of Centrofarm, a major network domestically.

The networks boasting the biggest annual sales per unit are Sensiblu and Dona, according to ZF calculations. Thus, Sensiblu, which last year generated 154.8m-euro turnover and operated 221 drugstores, posted sales of around 700,000 euros per unit, a level Dona also reached in 2008, with sales of 99.6m-euros and 135 drugstores. "It's about location in the first place. There are three things that matter in retail: location, location and location," Centrofarm head also said.

There are locations generating annual sales of millions of euros, with York Farm drugstore, located near Marie Curie hospital, as one example. According to Finance Ministry data, it generated 2m-euro turnover and income worth around 100,000 euros with 12 employees.

According to drugstore representatives, the most appealing areas are Dorobanti, owing to the high purchasing power of people going to this area, Unirea and Piata Romana. Malls rank fourth.