Hendrik Notmeijer, trading area manager with IKEA Trading, says that in the first half of the year the company's acquisitions in Romania were 10% higher against the similar period of last year.
"This percentage could have been higher, but lack of sufficient (production) capacities and quality problems were the reasons that it is only 10% more," said Dutchman Hendrik Notmeijer. IKEA opened its Romanian office in 1992, although its purchases on the local furniture market started in the '80s. IKEA is the world's biggest furniture retailer, selling functional and easy-to-assemble, low-price products.
According to the latest available information on the market, the value of acquisitions in Romania in the 2005 fiscal year (September 2004 - August 2005) stood at some 200 million euros.
The main products that IKEA acquires from Romania are those made of solid wood, upholstery and ceramics.
"Foreigners see Romanian furniture products as competitive, but a lot of monitoring is necessary to get and hold the right quality," said Hendrik Notmeijer.
In Romania, the company buys furniture from about 40 suppliers.
"Our main suppliers are the solid wood ones, but their overall number has decreased because we are closing close down non-performing suppliers and at the same time we open new promising suppliers," says Notmeijer.
Besides the representative office, IKEA also owns the Swedwood plant in Siret, Suceava county. "IKEA and Swedwood are part of the same company, but Swedwood is the independent production part and Trading is the independent purchasing part of the family," explained IKEA Trading representative.
At present, he added, IKEA Trading has more than 100 employees in the Balkans, of whom 70 are in Romania. Romanian producers working with the Swedish giant are almost exclusively directing their supplies to it. Some of them started collaborating with IKEA more than 6 years ago. Such is the case of Buzau-based Nikmob producer.
The year 2005 was for the furniture industry, one of Romania's traditional domains, one of the toughest years after 1989, with both exports and production having witnessed a slum in value in euros. Nevertheless, the first part of 2006 saw these indicators stabilise. "The Romanian furniture industry has to increase its efficiency dramatically in order to stay competitive, the more so as Romania is close to joining the EU and domestically prices for raw materials and utilities continue to rise," Notmeijer also said.
In his opinion, the most dynamic segment of the Romanian furniture industry is the upholstery business.
The Swedish retailer's rising interest in Romania is also proven by its announcement related to the opening of the first store in a franchise system. Swedwood International also plans to strengthen its presence by opening a new plant.
IKEA
The biggest furniture retailer in the world, with functional, easy-to-assemble, low-price products
Entered Romania by opening a representative office in 1992
Began buying furniture from the Romanian market as early as the '80s
Acquired 10% more products from the Romanian market in the first half of this year
Mainly purchases solid wood products, ceramics and upholstery
In Romania buys furniture from around 40 suppliers
Pentru alte știri, analize, articole și informații din business în timp real urmărește Ziarul Financiar pe WhatsApp Channels
