Swedish furniture and home accessories retailer Ikea announced on November 1 it will invest €80mn to open its second store in Romania’s capital Bucharest and plans to open three more stores in other cities by 2021, local media reported.
The expansion comes on the back of rising consumption in Romania. Ikea's 2016 fiscal year was the company's best in Romania, with sales jumping 21.5% on the year. It is also part of a wider expansion in Southeast Europe, where Ikea aims to have 13 stores in Croatia, Romania, Serbia and Slovenia by 2025.
Southeast Europe, where Ikea aims to have 13 stores in Croatia, Romania, Serbia and Slovenia by 2025.
In June last year, Ikea bought a 13.7 hectare plot of land in Bucharest to build its second store in the Romanian capital. The value of the transaction was not disclosed, but was estimated by local daily Ziarul Financiar at €15mn-€20mn.
“We are in the final phase of the store in Pallady [area] and we hope we will open it by the end of 2018. Once we get the building permit, it takes 15 months to build it. It will be a €80mn investment,” Ikea retail manager for south eastern Europe Stefan Vanaverbeke said, according to Ziarul Financiar.
The new store will create 300 new jobs. It will have an area of 3,600 square metres and will be the biggest Ikea store in the region.
The Swedish retailer, which currently operates only its Bucharest store in Romania, plans to open three more in three of the country’s biggest cities.
“Timișoara, Brașov and Cluj are the next three cities where it is a priority for the Ikea Southeast Europe organization to open new stores in Romania. Our property and expansion team is prospecting plots that fulfill the parameters needed for a new store, such as: easy access to means of public transportation and a good road infrastructure, land surface and a good location close to the city,” Vanaverbeke said in a press release.
Ikea's turnover rose 21.5% to RON514.6mn (€114.2mn) in the 2016 fiscal year. The store was visited by 3.2mn people while the online shop had 6.6mn visitors.
“This fiscal year, the Ikea store in Bucharest had record sales and turned Romania into a solid growing market for Ikea SEE. First of all, this is mostly due to the growth of the online orders service which exceeded our expectations. Ikea products also played an important part in this year’s success,” Vanaverbeke said.
103,975 confirmed orders were placed online during FY16, an increase of over +140% compared to FY15. Most orders were from Bucharest, Cluj, Timisoara, Iasi and Constanta.
CEFC, the acquisitive Chinese energy group, and Penta Investments, the closely-held Slovak financial group, are bidding together for Time Warner’s stake in Central European Media Enterprises (CME), ... more
Italian Enel Group will invest about €565mn in Romania in 2018-2020 to upgrade its electricity distribution infrastructure, Enel Group infrastructure and network manager Liviu Gallo stated in an ... more
Greece’s Eurobank said on November 10 that it expects to sell its Romanian units to local lender Banca Transilvania (BT) at the end of November. The transaction includes Bancpost, ERB Retail ... more