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How a 45m-euro retail business ran out of steam in one year

How a 45m-euro retail business ran out of steam in one year
09.08.2010, 23:42 4

One year from voluntary insolvency, SPAR, held by brothers Ioanand Floare Cuc in Arad is now left with 25-30 of the over 700employees it had at the end of 2008, after it dropped retailoperations.

This is the second operator on the market, after Pic hypermarketchain, to drop its core business - retail - because of losses ithad accumulated and because of suppliers' reluctance to work withan insolvent store chain.
"The company no longer operates stores, but grants the SPARfranchise. The employees working in the stores taken over by otherinvestors have largely been taken over by the new store operators,"said representatives of the judicial manager of SPAR SRL inArad.
In 2008 - the company's best year - turnover had reached 45 millioneuros, and the SPAR chain counted 20 supermarkets and onehypermarket. At the end of the year the Cuc brothers, however, losta deal put at over 20 million euros with a foreign investment fundinterested in taking over the chain amid the financial crisis, withthe consumption decline and pressure of bank loans forcingshareholders to file for insolvency. Over the last year theoperator has sought to renegotiate all rental contracts, but closedseven stores because of the too high prices and shed around 500jobs as part of the chain's reorganisation.

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