Five domestic supermarket networks, whose cumulated sales were valued above 50 million euros in 2006, are going to forge the RomRetail alliance, due to operate as a shared procurement centre.
Romanian-held networks Ethos (Bucharest), Cip Savin (Campulung Moldovenesc), Wolf (Brasov), Mara Supermarketuri (Focsani) and Hard Discount (Brasov) will act as shareholders in a company carrying out consumer goods procurement operations, to be set up at the beginning of April.
The five founders of RomRetail jointly own 31 supermarkets and plan to expand their networks this year.
"RomRetail was set up as a result of tight competition within the retail market. The new procurement centre will make us appeal to suppliers and create greater efficiency. The centre is due to become operational in around three months' time," stated Ion Soloman, manager of the Ethos supermarket chain.
The founding members of RomRetail plan to develop the firm in three stages; the first stage will be related to the harmonisation of commercial conditions, whilst the second and third stages will involve the start of joint procurement activities and the construction of a logistic centre respectively.
Soloman also stated that RomRetail remains open to other supermarkets wanting to join the alliance on condition that they should have total sales exceeding 3 million euros or be in a well-positioned independent location, as well as have future expansion plans.
Ethos, the biggest of the RomRetail members, will have a total of 13 outlets through investments worth 1.1 million-euros in three new stores this year, after it opened its first supermarket outside the capital city in 2006.
Domestically, other procurement centres operate only within some international retail groups, such as Louis Delhaize or Metro.
Modern retail registered the fastest growth rate in the past year and will continue to grow at the same rate this year, largely owing to the development of international retail networks operating on the Romanian market.
These boosted their number of outlets by over 40% last year and have come to own around 270 outlets in total, according to a survey conducted by MEMRB Retail Tracking Services Romania.
The expansion of international retail chains is the biggest challenge to small supermarket chains built by domestic entrepreneurs, as these smaller retail stores struggle to keep up with the market growth rate due to the lack of financial resources.
Several supermarkets part of some small domestic networks were last year takeover targets for foreign-held companies such as La Fourmi, Artima, Spar and Billa.
As a result, La Fourmi last October announced the takeover of three of The Best supermarkets in Bucharest, which it plans to re-brand this year, with the company's representatives also stating that they may consider further acquisitions.
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