Retailers, Mall Developers In Romania Blame Each Other For Lower Sales

Retail sales have dropped significantly this year in Romania, and retailers and developers blame each other for this situation, with the merchants invoking too high rents and the shopping center owners saying the stores lack in merchandize and qualified marketing staff.

The retail sales saw a 20% drop in Romania this year, the highest decline among the Central and Eastern European countries. The white and brown goods sector and the furniture and fashion industries were the most affected market segments this year, according to real estate analysts.

"The logistic expenses are 3-4 times higher in Romania compared with other European countries due to the infrastructure, the purchase power is lower, and, despite these, the shopping mall developers impose us very high rents," Wednesday said Markus Pinggera, the expansion manager of footwear retailer Deichmann.

In his opinion, retailers and developers do not understand each others' problems.

On his turn, the operating manager of Anchor group, the developer of Bucuresti Mall and Plaza Romania shopping malls in the capital city Bucharest, Radu Tanasescu said that some stores do not adapt to the current market and, thus, their sales get affected.

Reuven Havar, the country manager of AFI Europe that will open next month AFI Cotroceni Mall, said the retailers are asking for lower rents even if the company did not benefit from any price cut from the builders, despite the economic crisis.

"The retailers are asking for discounts due to the crisis. We did not receive any price cut from the builder. We are in the same situation as retailers and we've got no reduction from the constructor," Havar said.

On the other hand, Grigoris Zarifopoulos, the general manager of Marinopoulos, the company selling the Gap brand in Romania, said that attracting many people in a shopping mall does not ensure, by default, a certain level of sales.

Despite this situation, the two retailers' representatives said the companies plan to expand on the Romanian market.

"We are expanding as soon as we can, but the market is limited for the moment," Deichmann's representative said.

Marinopoulos's manager said the company's next step is opening a street store in Romania.

The Gap brand is sold in Romania in two shopping malls, respectively in Baneasa Shopping City and Plaza Romania, while Deichmann owns 14 stores in several cities, including Bucharest.

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