Strong Growth for bauMax
The do-it-yourself group increased its sales in Austria and Eastern Europe in 2010.
Strong Growth for bauMax / Picture: © Baumax
Sales of the DIY chain rose last year by 7% to € 1.5bn, a new record. The increase in Austria was 4%, with domestic sales reaching € 640m. Business in Eastern Europe has grown significantly stronger by 9% to € 860m.
CEO Martin Essl emphasized the plan to consolidate existing markets. Getting into new markets is currently not foreseen. Seven to eight new branches are to be opened in 2011. The reason: bauMax entered the Turkish market only last year, and two branches have been opened there since, with three or four more being built this year. The expansion in Turkey will take 20 to 25 years, because the country is as large as all the other countries bauMax is operating in, according to Essl.
The business is highly cyclical and influenced by the volatile building construction market. The suppression of investments in the construction industry was felt clearly, said Essl. For this reason, there are hopes for new growth spurts in public funding of thermal rehabilitation.
Professionals in Eastern Europe are a new target group. The challenge in that market is to be able to keep very low prices. The household income in Romania represents only one-fifth of the Austrian level, in the Czech Republic one-third.
In addition to the Austrian and Turkish markets, the DIY chain is also active in the Czech Republic, Slovenia, Croatia, Bulgaria, Hungary and Romania.