Retailer Mega Image closes some shops in Romania after rapid expansion

Romanian retailer Mega Image, part of Belgian group Delhaize, announced that it will close all of its shops in the city of Pitesti, because of their poor results. Mega Image concluded that its four shops in Pitesti didn’t register sales levels that supported their operational costs, despite the company’s marketing efforts. “We see ourselves in the position to make a difficult decision and close our four shops in Pitesti, two Mega Image supermarkets and two Shop&Go shops,” said Xavier Piesvaux, general manager of Mega Image. “Unfortunately, we have to consider the current performance of these shops, which has been below expectations.” According to Mega Image’s officials, the closing of the operations in Pitesti is an exception to the company’s expansion plan, which will continue. “This is a punctual decision that will in no way impact the pace of our expansion in the Romanian retail market, which we estimate will remain similar to that in the past years,” said Mihai Spulber, Mega Image operations director. Mega Image had an aggressive expansion strategy in the last five years, increasing its network from 51 stores in 2009 to 420 in June 2015. Only last year it added more than 110 units to its network. Most of its stores are in Bucharest and the neighboring villages, but the retailer also tried to get a foothold in other cities, such as Constanta, Brasov, Ploiesti, Targoviste and Pitesti. Mega Image had a turnover of some EUR 633 million in 2014, 20% higher than in 2013, and a net profit of EUR 12.5 million. The company reached 7,200 employees in Romania. Retailer Mega Image opens first shop under Romanian private label brand Retailers: Mega Image has monopoly in some Bucharest areas Fastest growing retailer in Romania names new expat at the helm editor@romania-insider.com