Kika to boost sales by 15 pct in 2014 following Steinhoff takeover

Newsroom 13/05/2014 | 16:58

Furniture retailer kika plans to increase its sales in Romania by 15 percent this year after cutting shelf prices by 15 percent on average and changing its business strategy, said Lars Lund (pictured), country manager kika Romania, Croatia and Serbia, during a press conference today. Results posted so far this year are encouraging as is the overall evolution of the furniture market, he added. After five years during which the market has either dropped or remained flat, now it is once again going up albeit the increase is below the growth rates reported before the crisis, said Lund. The evolution of the economy which in turn affects the consumers’ confidence is crucial to how the market will evolve from here, he added.

The kika/Leiner group which is present in seven countries with some 73 stores was taken over last year by South African Steinhoff Group. This has enabled the retailer to get better acquisition deals and in turn lower shelf prices by about 15 percent on average, said Lund. The cut was welcomed by local consumers and it led to sold volumes going up, he added. The retailer has made other changes as well, giving up on the home distribution of printed catalogues and focusing on its online presence and social media. It has also changed the store’s layout and launched services and products meant to increase consumer loyalty.

Kika operates only one store it Romania, in the outskirts of Bucharest, which it opened six years ago. The company has bought land to open new outlets in Constanta, Oradea and Timisoara but expansion plans were put on hold after the crisis started. This will not change over the next eight to ten months but in the meanwhile the retailer wants to launch an online store, said the country manager.

The kika store sells some 70,000 products and it has around 4,500 suppliers. Out of this only 6 to 7 percent are local producers but the company said it wants to increase their share. The best sold products in Romania are couches followed by bedroom and living room furniture.

Some of kika’s competitors in Bucharest are Ikea and Mobexpert.

Read more in next week’s print edition.

Simona Bazavan

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