The group has already signed the necessary franchise contract, as well as a contract for another two brands, and also plans to open a multibrand home decor and accessories store.
"We're in advanced talks to get the franchise for the two clothing stores. One of them is a family-store, which covers around 600 square metres, and targets young people below 30 with monthly incomes of 300 to 400 euros. The second targets the medium-higher price segment and covers around 200 square metres," Vicentiu Zorzolan told ZF.
For the two new brands, AAV Group management is considering both Bucharest and the major cities in Romania. The brand positioned on the medium segment will be present in 15 stores by 2011, while the other will be represented in six stores.
The company's development policy also envisages the launch of a multibrand store concept that covers around 500 square metres on the home&decoration market. "The Romanian home decor market is still in its early stages, but will grow with the housing market. (...) This year, we'll open a store in Bucharest and by 2011 we are going to reach 8-10 stores," says Zorzolan.
For the three new concepts, AAV Group has budgeted investments worth around 6m euros in addition to the budget earmarked for the opening of Cortefiel stores. "(...) This brand, which targets people with incomes of 600-800 euros, will require investments worth as much as 500,000 euros," says Zorzolan.
The company, which set out to attain 20m-euro turnover this year, up 70% year-on-year, targets revenues worth as much as 100m euros in 2011 as a result of the expansion of the network of brands part of its portfolio.
"This target can be reached under normal conditions, should inflation stabilise and food prices stop rising," explains Zorzolan.
Another factor that may slow down apparel retailers' sales is the high number of shopping projects due to be opened, according to Zorzolan. He expects the market to settle in the next four years. Also, malls will be structured depending on the area they are located in.
At present, AAV Group's brands are located in shopping centres, after the company shunned the high-street concept because of the high rents and low traffic.
As for the prices of apparel brought by AAV Group, Zorzolan reckons they are as much as 6% higher compared with European stores, with the gap being triggered by shipping costs and exchange rate fluctuations.
"In the near future, though, competition will become tighter and prices will start to fall. Also, as inflation stabilises and the exchange rate becomes more predictable, prices will get in line with European ones".
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