Oriflame Romania, a subsidiary of the Swedish cosmetics company, logged 13% growth in Q1 sales this year as compared to the corresponding period of last year, according to the company's general manager Monica Tatoiu.
"The increase in Q1 sales is due to the launch of new products, mainly in the skincare sector, such as Time Reverse, Skin Quencher, Aromacare, but is also to an increased brand-awareness," Tatoiu stated.
The company aims to achieve turnover worth 26 million euros this year, up 18% from 2003, when it stood at 22 million euros.
Last year, Oriflame posted only 3% growth as compared to the previous year, which made it one of the worst years for the company since its arrival in Romania. Fiscal losses amounted to 23 billion ROL, caused by the unfavourable ROL/EUR exchange rate.
Company officials grounded the results in weak purchasing power and last year's boom in the purchase of electronics and home appliances in instalments, which took a bite out of the population's available income.
"Purchasing power has grown this year. In the first quarter of 2004, the biggest growth was posted by perfume sales, followed by skincare products and makeup. We will continue to expand the skincare range and we will also organise the launch of the Sollinden perfume, endorsed by Sweden's royal family," Tatoiu added.
Oriflame Romania has a 3,800sqm national distribution centre located in Bucharest, in the Baneasa area, also owning another piece of land of some 4,000 square metres.
The company, which distributes cosmetics through direct sales, is planning a 2.5-3 million-euro investment in a distribution centre, to be located in the western area of Romania.
Oriflame Romania has some 100 direct employees, while the investment in the new distribution centre may create another 40-50 new jobs. The number of distributors exceeds 2,000 people.
The Oriflame products sold in Romania are made in Sweden and Poland, with the company having started the construction of a plant in Russia.
The Romanian cosmetics market amounts to some 200 million euros annually. Oriflame's main competitors are Avon, L'Oreal, Beiersdorf and Romsar.
georgiana.stavarache@zf.ro
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