Florin Panea, chairman and CEO with Leonardo footwear retailer, says he plans to develop Libelula store network that sells footwear to low-income people, which could cover a yet untapped market niche.
"Libelula project was launched six years ago and started as a test with two stores: one in Timisoara and one in Oradea. Last year we decided to expand at a very fast pace in all the small towns and so we set reaching 100 stores in two years as a target," says Florin Panea.
Libelula store network sells footwear at very low prices, targeting low-income consumers. At present, there are 15 stores operating under Libelula name, with a new one to be opened this month. According to Panea, the concept targets small towns of around 30,000-40,000 inhabitants, but could also be implemented in the districts located on the outskirts of the cities.
" (...) I consider the market we are targeting is very large, there are many cities for which the concept is suitable and we have the advantage of being the first," says Leonardo head. Investments in Libelula stores are much smaller than those in Leonardo stores, because furniture is cheaper, product stocks entail lower costs, while space and rents are smaller in towns.
Despite the high number of stores the network will include in 2009, Panea says their contribution to the revenues will remain low in the company's turnover, given the low prices of products.
For now, Libelula network will exclusively target the domestic market considering that in Hungary, where the company has built a strong presence since 2000, the market for the extremely cheap products of the network is very small, says Panea.
Leonardo Romania in 2006 reached turnover worth 268m RON (76.1m euros), up 59% year-on-year in RON, a value including Libelula sales, "but in an insignificant percentage".
Leonardo network includes 110
