From his unfinished office, deliberately placed at the bottom of the investment list because production and the business welfare come first, Vasile Armenean, owner of the biggest Romanian ice cream producer, is closely coordinating the activity of his 400 employees. From time to time, he glances at the Finance Ministry’s website to see whether his main rival, Nestle Ice Cream, has released its financials. He’s curious to see whether his 20m-euro 2008 sales were bigger than Nestle’s because in 2007 he’d been just one step away from becoming market leader.
However, Armenean is one of the few Romanians with a comfortable situation. Most Romanian businesspeople, such as Dan Viorel Sucu (Mobexpert), Dragos Paval (Dedeman) or Ioan and Viorel Micula (European Drinks), are rather pressured to find alternatives to overcome a situation that has proved to be more difficult than they had expected. Unfreezing sales, financing current activities, recouping debts, these are just some of the problems that, if not addressed properly, can drive many into bankruptcy. And indeed, the crisis has reduced even further the number of Romanian companies fighting for a leading position in their respective fields of activity.
More than ever in the past decade, the market is difficult for all companies, either international or Romanian ones. ”All companies need to understand now what their strengths and weaknesses are and, whenever the situation requires it, to react and reposition themselves as quickly as possible,” says Hein van Dam, a partner in the financial consultancy department of Deloitte Balkans.
At first glance, the balance of strengths leans toward the large groups, due to their finance strength, easier access to loans and the more experienced management teams. However, these assets are not exclusively held by multinationals, say the managers of Romanian companies. Raul Ciurtin, chairman of Albalact, owner, together with his father, of the main stake in the dairy company, says ”the very creation of a consolidated, professional management team, with a modern vision, and particularly the implementation of development policies meeting market needs” were the key to the development of their business.
He adds that sound policies, investments operated when and where needed and the consolidated team are vital for the development of a company, beside capital, marketing budgets and portfolio expansion.
All these elements are also found in the businesses of some other Romanian entrepreneurs, who are however coping with other types of difficulties, deepened by the crisis. In the opinion of Dan Viorel Sucu, Mobexpert owner, a major problem for Romanian entrepreneurs is that large companies are not behaving like Romanian firms, not even the Romanian-held entities. At the opposite end, the solidarity of other nations is obvious. Another problem signalled by Sucu is the fact that, in their discussions with banks, Romanian companies are only talking with intermediaries as financial groups they talk to do not make decisions domestically, but abroad. The lack of a powerful Romanian-held bank is viewed by many businesspeople as a major setback for Romania at this point.
Leave a Reply