The fridge and the TV set from Flanco, the computer from Flamingo. This is what the decision to purchase various electronic home products and appliances used to look like several years ago. However, starting last year, when hire purchase caused soaring demand for every type of equipment, things have become more complicated. This is because the home appliance retailers like Flanco began selling IT products, while computer stores like Flamingo began including TV sets or Hi-fi audio systems in their offer. Both players achieved significant sales volumes at first. Who is going to win in the long run?
"The electronics and home appliance networks see IT products as a very useful and already necessary complement for their product portfolio - every such operator on the mature markets is offering this category of products, as well as a great many voice and data communications-related products. This is why the movement of such networks to IT is strategic and irreversible," Marius Ghenea, Flanco general manager said.
The company made 120 million-euro turnover last year, approximately 10% of which come from IT&C equipment. Furthermore, the IT&C segment will be faster to progress than the home appliances market this year. "We estimate 16-18% growth in the total traditional electrical (electronics and home appliances, IT&C not included) market this year. The IT&C growth could be significantly higher, probably around 25% - we're talking about the individual consumer market, not about the business market," Ghenea estimates.
Dragos Simion, the chairman of Flamingo Computers, which made $72 million turnover last year, grounds his company's "move" on the convergence of IT products and the latest audio-video technologies in the last few years.
"The computer systems have expanded their multimedia features, and are pushing the PC further and further into the "entertainment" realm. At the same time, the audio-video technologies have moved on from analogue to digital, benefiting from ways to convey the data so as it could be read by the modern computers by making the communication standards uniform. There are several possible development paths and Flamingo chooses that which maximises its current competitive edges," Simion says. He did not provide any details as to how high the sales of audio-video products could be.
"It is too soon to express objectives in form of percentages for the IT-related fields, but this segment will surely become significant for Flamingo's turnover very soon, considering the potential of the market and the resources allocated for this purpose."
Still, an expansion of the competition between the two types of retailers to other segments, such as refrigerators and washing machines, is out of the question, even though there are such appliances out there that can access the Internet.
ionut.bonoiu@zf.ro
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