The economic crisis, an opportunity for retailers in Romania

Dabija, Dan-Cristian and Alt, Monika Anetta (2012): The economic crisis, an opportunity for retailers in Romania. Published in: Crisis Aftermath: Economic policy changes in the EU and its Member States, Conference Proceedings, Szeged, University of Szeged , Vol. ISBN 9, (2012): pp. 337-355.

Abstract

There is a clear tendency for the Romanian retailing to adapt to the requirements of the international market. If in the years following Romania’s adherence to capitalism the indigenous retailing was marked by a strong segmentation in small retail units with low turnover, retail chains were considerably developed. The domestic market began to be penetrated by the first European retail chains in the mid-nineties of the last century. That was the spark of the change, to which many of the players in the retail sector were not able to adapt. During this period one can notice, on the one hand, a decrease in the majority shareholding of state-owned capital in favor of private capital and, on the other hand, a decrease in the value of the public sector and an increase in the value of the private sector.

Romania’s accession to the European Union and the removal of customs barriers to the merchandise brought from other member states represented for retailers the long-expected signal of progressive expansion. After going through the stage of consolidation and intra and inter-organizational learning in Bucharest and a few important cities, new subsidiaries were subsequently opened in most of the county towns. Whereas most retailers promised to open a considerable number of subsidiaries in the period of economic expansion, in the last years their activity has been on the decline, being focused mainly on solidifying their own position on the market through mergers or acquisitions as well as exhibiting a central tendency to focus heavily on price and customer attraction.

Based on secondary sources of information, the present paper attempts to make a diagnosis-type analysis of the evolution of the retail market in Romania by highlighting the ways in which the western retail networks were adapted to the Romanian market as well as the strategies resorted to by the local networks in their attempt to overcome the economic crisis and deal successfully with the ever-decreasing income of the customers.

• Item Type: MPRA Paper
• Language: English
• Keywords: retail; crises; retail formats; acquisitions; food and non food retail
• Subjects: L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L14 - Transactional Relationships ; Contracts and Reputation ; Networks; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M3 - Marketing and Advertising > M31 - Marketing; L - Industrial Organization > L8 - Industry Studies: Services > L81 - Retail and Wholesale Trade ; e-Commerce

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