Centrofarm, the network of pharmacies whose business stood at 16 million euros in the first half of this year, has rethought most of its expenses, which could allow it to make profit in the second half, after 1.5 million-euro losses in the first six months.
"We negotiated discounts for drugstore openings with our suppliers, we reconsidered consumables and also looked at the marketing budget. Salaries are the only thing we did not touch," said Dorin Catana, the company's general manager.
Centrofarm operates 60 pharmacies, half of which are located in malls, and is currently employing approximately 500 people. Most locations are rented, and, after negotiations conducted in two stages since the beginning of the year, the company got landlords to lower the rent by 25% on the average. The company is not paying any rent for some of its stores located in malls.
"We are trying to cut losses. It was the only solution to avoid closing the respective stores," Catana says.
Centrofarm posted 46% higher turnover in the first half of this year, compared with the corresponding period of 2008, but the growth pace has slowed down over the last few months.
"Sales were slower in September. We had expected 6% growth, but it was below 1% (compared with August i.e.), which took us by surprise," Catana said.
He adds that there is not a single explanation for this decline in sales, with each store coming up with "its own version" of it. "There were declines in traffic, and in the average cash receipt," Centrofarm's boss explains.
Centrofarm has closed three stores since the beginning of the year, but is keeping an eye on others, too. On the other hand, it is considering opening three more.
The company is currently working on next year's budget and says that so far, the 2009 spending and revenue budget has reached version number 33. However, the re
