The emerging markets in CE, SE and Eastern Europe include Romania, Poland, Hungary, Turkey, Serbia.

The emerging markets in CE, SE and Eastern Europe include Romania, Poland, Hungary, Turkey, Serbia.
The emerging markets in CE, SE and Eastern Europe include Romania, Poland, Hungary, Turkey, Serbia, Lithuania.

Thursday, 31 January 2013

Meat production in Romania

Romanian meat producer Agricola Bacau saw the group’s total sales amount to approx. EUR 133 million in 2012, up 8% y-o-y.

Agricola International, the group’s main company registered a turnover of approx. EUR 80 million. Compared to 2011, the turnover of Agricola International was up by 7% but the net margin, although positive, was very low. The economic performance of all companies active in the zootechnics industry in Romania was significantly influenced by massive price increases for basic inputs.

The meat producer estimates its market share reached 16% last year and plans to increase it by a percentage point in 2013.

Poultry sales were up 7% (volume) last year compared to 2011 while the overall turnover increased by 20% mainly due to a new product mix and less because of price increases, said the company.

For meat cooked and smoked products Salbac, part of Agricola Bacau, saw sales increase by 2% (19 % in value) while egg sales were up 14%. 



[Business Review]

In case you are interested in acquisition targets or market intelligence in Romania, please feel free to contact us at europa@frdcenter.ro or frdbuc@dnt.ro

Jackie Bojor
FRD Center Market Entry Services
www.frdcenter.ro

Monday, 28 January 2013

PV / Photovoltaic investment in Romania in 2013

Romania is currently one of the main hotspots for Photovoltaic projects in the
world. 


The “Country Attractiveness Indices” issued by Ernst & Young, ranked
Romania on 13th position globally and, according to analysts, it is currently
the 3rd best place for PV projects in Europe, due to very attractive
government incentives (6 Green Certificates / MW – currently 56 EUR / GC),
good levels of solar radiations, price of the electricity on the free market
(currently approx. 50 EUR/MW), availability and cost of land etc. 


As the state incentives are guaranteed only for projects that start operations by the end of
2013, there is a clear and limited window of opportunity for investors
interested to buy or to invest into such Projects.

FRD Center currently holds 2 sell mandates from shovel-ready PV projects
that are looking for equity / debt financing and offer good ROI figures:
- A 9.9 MW land project located in SSW Romania
- A 5.5 MW rooftop project located next to Bucharest

Both have all studies, business plan and permits in place – please contact us
if any of these two or other type of renewables projects are of interest to you.

Andrei Bojor
frdbuc@dnt.ro

Thursday, 24 January 2013

Retail in Romania - up-dates

  • After Bucharest, Mega Image expands Shop&Go network with 7 new stores in Brasov this April.  This is the second Romanian city, after Bucharest, where the retailer will develop the Shop&Go concept.  Mega Image currently runs over 200 stores in Romania.
  • Moldovan clothing retailer Aridon, which took over the Levi’s franchise for Romania, is continuing its program of expansion in Romania with a new Levi’s store in Bucharest’s AFI Cotroceni Palace shopping center. The store will be under the REVO-2 brand and will open during April.
  • Romanian IT&C retailer Flanco posted a turnover of EUR 137 million in 2012, up 25 percent compared to the previous year, mainly due to the investments made. Flanco’s investments in modernizing and expanding the existing stores, but also in opening new stores, amounted to over EUR 2.5 million last year. 
Swedish retailer Ikea negotiates with shopping center owner for new opening in Romania. Ikea might open a new store this year in Era Shopping Park located in Iasi, Romania. Ikea is currently in talks with the retail center’s owners, according to one of Era Shopping Park’s shareholder  the European Convergence Development Company (ECDC).
Swedish retailer Ikea had a turnover of some EUR 89 million in the financial year 2011 – 2012 in Romania, a growth of 10.8 percent on the previous period, the retailer announced. As well as over 3 million customers and 11 million products sold between September 2011 and August 2012, 4 million people in Romania also checked the Ikea website during the period.
  • Retailer Profi presently employs over 4,000 people but plans to go beyond 5,000 by the end of the year, according to the retailer’s general manager. The announcement comes after the company said it will invest some EUR 18 million to open 45 new stores in 2013 in addition to the 150 existing ones.
  • The Romanian subsidiary of clothing retailer Sprider Stores, which was taken over by Cyprus – based Naqua Investments last year, plans to become profitable in 2013, with a targeted profit of EUR 658,000. The retailer also announced its plans to stay in Romania, after its former mother company filed for insolvency and is currently restructuring.
  • SABMiller, which owns Romanian beer brands Ursus, Timisoreana and Ciucas, has announced a 23 percent increase in sales volumes in Romania during the last three months of 2012.
  • After it opened 8 new stores in Romania last year, Swedish fashion retailer H&M has reported sales worth approx. EUR 74 million for the 2012 fiscal year (December 1, 2011 – November 30, 2012). Expressed in lei, sales were up by 107 percent. At the end of the 2012 fiscal year there were 19 H&M stores in Romania.
  • [Romanian Business Insider, Business review, Nine o'Clock etc.]


    Monday, 14 January 2013

    Romania - good business and investment perspectives for 2013

    •  

    • Last year over 218,000 Austrian tourists visited Romania, up nearly 14% over the previous year, while their expenditure in Romania was estimated at 52 million EUR. It is expected that the trend will continue in 2013.
    • The Cluj County Council are in advanced negotiations with a multinational company which intends to invest 1 billion euros in a production facility in the industrial park Tetarom III Jucu. According to representatives of Cluj County Council, this investment involves the creation of 5,000 jobs over a period of 4 years. 
    • Annual inflation rate at 4.95% in 2012, below the NBR target 
    • Romania climbed three positions in the world ranking of economic freedom in the 2013 Index of Economic Freedom made by Heritage Foundation in partnership with The Wall Street Journal. The global financial and economic turmoil forced the Romanian economy to endure sharp structural adjustments. “Despite the challenging political environment, Romania has undertaken needed reform measures that include spending constraints and labor market reforms. Recovering from the severe shock of the crisis, it continues to place a high priority on restoring fiscal sustainability and strives to enhance overall economic competitiveness”, the 2013 Index shows
    • Lukerg Renew will invest around EUR 135 million to build a wind farm in Eastern Romania, Tulcea region, after acquiring the wind project in late 2012. Lukerg, which is a partnership between Russian oil & gas firm Lukoil and the Italian energy group ERG, will begin building works this quarter. The farm is expected to start commercial operations next year. The company will use a long term non-recourse loan to finance the project. Romania reached 1,779MW of wind capacities by November 2012, according to grid operator Transelectrica.  
    • Romania ranks 10th on wind investment attractiveness, says E&Y report. Investors perceive Romania as a top destination for renewable investments, mainly wind, allowing the country to rank 13th out of 40 countries on renewable energy and 10th on wind, according to the latest Renewable Energy Country Attractiveness Indices of the professional services firm Ernst&Young (E&Y). Romania, which is already the “shining star” of the renewable sector in Eastern Europe, may benefit from an influx of Bulgarian investors, drawn away by cuts in subsidies in the neigboring country, according to E&Y. 
    • South Korean group Samsung looks at building two photovoltaic parks in Romania, in the Giurgiu County, south of Bucharest. Samsung’s photovoltaic parks in Romania will have a combined 45MW installed capacity. Photovoltaic New Horizon (PNH), another South Korean firm, is currently working at three projects in Romania.
    • “Romania has an open economy, which has benefited greatly from the opening up of new markets, especially in the EU. It will benefit from the continued gradual liberalization of world trade and closer trade integration with the EU.

      Some of the remaining barriers to trade in goods with the EU are likely to be removed, and liberalization of trade in services, which could eventually benefit Romania, is set to continue, albeit at a slower rate than previously planned”, according to the Ernst & Young’s annual globalization report, “Looking beyond the obvious: globalization and new opportunities for growth”.
       

    Thursday, 10 January 2013

    Scrap metal market in Romania

    The sector of scrap metal market in Romania presents serious interest for foreign players - importers of scrap metal as well as investors.

    For one of our clients, in 2012 we carried out an in-depth analysis of the current situation of the market of waste collection and recycling in Romania, focusing on the scrap metal sector. 

    Topics investigated have been:
    • General Characteristics of the waste sector in Romania.. 11
    • Metal Scrap sector including Domestic Consumption and International Trade as well as the main players: Traders with Ferrous and Non Ferrous Metal Scrap.. 26
    • End of Life Vehicles. 58
    • Waste From Electronics and Electrical Equipment 77
    • Packaging Waste.. 91
    • Batteries and Accumulators. 102
    It is generally known that Romania is a net exporter of metal scrap. In 2011, Romania exported ferrous scrap mostly to Turkey while the non ferrous scrap was exported mainly to Bulgaria, China, Serbia, India, Italy or Turkey.


    Based on the data reported by the operators in the metal scrap field, the locally generated metal scrap in 2010 is estimated to some 2.1 million tons, up by 63% compared to 2009.  


    Monday, 7 January 2013

    Case Study - Orthopedic surgical implants and devices distribution in Romania, Serbia and Slovakia

    Client's requirements


    Our Client is a Chinese manufacturer of orthopedic surgical devices and implants exporting at global level. Having already attempted to penetrate the emerging markets in Europe without success, they requested FRD’s support in identifying and selecting local business partners: specialised successful importer-distributors of orthopedic surgical implants and devices with a large client-base in Romania, Serbia and Slovakia, respectively. 

    FRD Center's deliverables

    After familiarising ourselves with the Client's products and having established together with the Client their selection criteria and expectations, FRD's team and our local partners in Serbia and, respectively, Slovakia, scanned the local markets of importer-distributors of orthopedic surgical implants. 


    The process continued with the selection phase, identifying and interviewing relevant contact persons and assesing their interest in a 1-2-1 meeting with the client after having presented to them the Client-company and their products. 

    We and our local partners prepared for the Client business itineraries of 1-2-1 meetings with interested local companies in each of the 3 markets. 


    Conclusions

    Resulting from this market entry Business Partner Search & Selection project, the Client obtained valuable direct contacts with local buyers and the first orders followed swiftly. For 2013, the Client is planning similar projects in Middle Eastern markets. 

    Case Study - 3D CAD for technology manufacturing in Romania

    Client's requirements

    Our Client is a major global automotive manufacturer. Their regional office in Eastern Europe, based in Poland, requested FRD’s support in identifying and selecting local companies offering specialised 3D CAD services for the technology manufacturing process. 

    FRD Center's deliverables

    Once we clarified with the Client their objectives, selection criteria and expectations, the FRD Center consultants carried out an extensive search & selection process, identifying and interviewing local services providers and qualifying those that supplied satisfactory services, references and project portfolios.

    Conclusions

    Resulting from this project, the Client obtained verified contact details and brief profiles of local 3D CAD providers, accompanied by comments and recommendations from the FRD consultants. For 2013, the Client is planning a local visit to Romania to personally visit the shortlisted local companies. 

    Case Study - Brass and Bronze cast parts production in Romania

    Client's requirements

    A global producer of brass cast parts, in the process of diversifing its product line due to being merged with an important bronze parts producer, requested FRD’s support in developing their business in Romania. The Client was mainly interested in the current and future opportunities on the Romanian market, as well as challenges of locally producing bronze cast parts.

    FRD Center's deliverables

    After thoroughly analysing the Client’s product portfolio and current business model, FRD Center team developed a market analysis which presented current market demand for bronze and brass cast parts, expected evolution, current sources of raw materials, potential threats to production relocation etc. The second phase of the project generated a d-base of potential local clients and interviews with the relevant Purchase Managers in order to obtain details about their specific needs.

    Conclusions

    As a direct consequence of this project, the Client acquired knowledge of the market potential and conditions for local production of bronze cast parts, as well as a d-base of verified and relevant potential local client.