EURONICS Deutschland eG

EURONICS International posts record revenues

Berlin (ots) -

   Europe's biggest alliance of independent retailers posts revenues 
   of EUR 12.6 billion / nine percent growth expected for 2008 / 
   EURONICS brand increases market awareness in Europe / e-commerce 
   gains in significance for the trade / growing challenges in the 
   European market 

EURONICS International, Europe's biggest group of independent retailers in the consumer electronics market, realised record revenues of EUR 12.6 billion in the elapsed financial year. The international alliance was thus able to build significantly on its market position yet again in 2007. "We're now operating at over 11,500 locations in 28 countries and are reaching more than 600 million consumers across Europe. With new members joining in Albania, Luxembourg, Spain, Portugal and the Baltic region in 2008, EURONICS International today represents a purchasing volume for the industry of around EUR 6.4 billion", explained Werner Winkelmann, President of EURONICS International, at this year's IFA (29.08 - 03.09.) in Berlin. In 2008, the group is expecting a revenue increase of 9 to 10 percent.

"Our growth proves that we have found the right answers in an ever tougher competitive environment in Europe. Our focus on innovation, quality, effectiveness and speed within the value chain will create a decisive competitive advantage for our members in 2009 too - despite the aggressive pricing policies of the discounters and some retail chains", added Winkelmann. The goal of the purchasing and marketing system is to take and maintain the qualitative market leadership position in the consumer electronics field over the next few years. European competition tougher

With revenue growth of around 17%, EURONICS International grew much faster in 2007 than the total European market, which rose merely by 4%. "With the accession of Sinersis, one of the leading groups in Spain, we added 1900 new stores and thus built still further on our leading position. Sinersis realises annual revenues of around EUR 1.1 billion," said Klaus Lahrmann, Managing Director of EURONICS International, at the press conference in Berlin. With Rota & K SIA (Technoland) and Elektromarktas UAB, two further EURONICS licensees with a total of 92 outlets and revenues of around EUR 105 million joined the alliance in the Baltic region. Belgium plans to award a license to dealers in Luxembourg by the end of this year, and EURONICS Italy has already issued a license for market players in Albania.

Overall, the revenues of discounters and retail chains, with a volume of EUR33.6 billion, and the specialist dealers linked in alliances, at EUR26.8 billion, are on equal footing.

The main business segments of the alliance in terms of revenue are the consumer electronics, household appliances and PC/Multimedia fields. "Consumer electronics and white goods are the principal sources of revenue for EURONICS International. Whilst the business in brown goods currently accounts for about 39%, the share of household appliances and large systems is around 33%", said Lahrmann. Besides the latest generation of LCD and plasma TV sets, consumers' needs for mobility are at the forefront for many dealers. Mobile navigation and communication systems remain among the key growth drivers - in consumer electronics, the new MP3 players, among other things, provided for good sales figures. "Manufacturers are presenting countless multimedia applications at this year's IFA. For specialist dealers, the convergence of digital products and the very diverse opportunities to network them will be a core theme in the future too," explained Lahrmann. High-definition media, such as Blu-ray players and camcorders, among others, promise strong sales.

From the perspective of EURONICS International, there will be major demand among consumers over the coming years to replace white goods. New generations of appliances increasingly represent lifestyle trends and are awaking the interest of the consumer. Operating ease, intelligent technologies, excellent design and enhanced energy efficiency, but also convenient and simple operation, will persuade many customers to buy.

The target group of LOHAS (Lifestyle of Health and Sustainability) is also ever more important to dealers - a consumer group that bases its lifestyle on health and sustainability. Current market figures demonstrate that more and more consumers are prepared to invest in higher-end products. "We expect high growth rates in white goods over the next few years. EURONICS dealers can achieve added value here that is significantly above market average across Europe".

Industry partnerships as success factor

"International suppler agreements and close cooperation with the industry have long been a crucial success factor for our marketing and purchasing alliance", added Lahrmann. In mid-June, EURONICS International awarded its "Supplier of the Year" prize for white goods to Bosch und Siemens Hausgeräte GmbH and to Philips Lifestyle for the consumer electronics segment. Every year, the members of EURONICS International vote on a "Supplier of the Year" and the prize underlines the excellent business partnership. They assess factors such as the degree of innovation and performance of the products, but also attributes such as marketing performance, after-sales support and delivery speed. "Besides quality assurance and controlling our networks, we are working on defining binding core product ranges for our members across Europe," continued Lahrmann.

For the European trade, the Internet continues to gain significance as a sales platform. "The number of sales via the web is rising. Many consumers are seeking dealers who offer good service and competent advice geared to their product portfolio," said Lahrmann. So EURONICS International is building further on its presence in the Internet. "Thanks to a tailor-made multichannel strategy, our members are today achieving optimum networking of online activities and stationary business, which still represents our core business," explained the Managing Director.

Growing challenges

In consumer electronics, European dealers have been registering shorter product cycles and strong price decline for several years, which is apparent especially in new entertainment system products. The number of competitors has also grown unabated over the last ten years. But consumer aspirations have also risen. "Quality of experience and convenience are the key innovation factors in consumer electronics, and every dealer needs to communicate that to his customers," said Lahrmann. Competent advice is in demand more than ever before, whether on the topic of high definition on the various media platforms, innovative audio systems to provide a cinema experience in the living room or the diverse networking opportunities. "The rapid technological developments are confronting the European trade with manifold challenges, and we are preparing our members for them. We are responding to growing product diversity, shorter lifecycles, price erosion and margin decay with a clear positioning in the quality segment," explained the Managing Director. "Our success proves us right. We are showing our members new opportunities to bind the customer to the trade with higher quality and better performance", said Lahrmann. With a successful operating type concept, international supplier agreements and an efficient marketing chain, the purchasing and marketing alliance is creating a solid foundation for further growth. "For the consumer, EURONICS today stands for added value and a promise of quality."

IFA 2008 meets expectations

With a new trade fair presence on around 500 m2 in Hall 23a at the IFA in Berlin, the alliance is presenting a selection of powerful concepts from among the services offered by its European members, which is well worth seeing. Dealers from across Europe can swap notes on successful realisation of aspects such as product presentation, advertising, e-commerce and member communication. Stronger than last year, the dialogue with consumers is at centre stage at the fair. From the perspective of EURONICS International, the IFA is establishing itself in 2008 as the world's most important trade and consumer fair for white and brown goods. "As Europe's biggest alliance of independent retailers, we explicitly welcome the expansion of the fair. Dealers and consumers can finally look forward to a uniform trade fair platform, which we believe will go down in history. We expect increased acceptance of the IFA from our dealers," added Winkelmann and Lahrmann, summing up their satisfaction after the first day of the fair.


The new technologies, such as HD-TV, DVD recording, telecommunication and portable computers are as much part of the range as the conventional products of entertainment systems and household appliances. In Germany, the alliance counts 1912 members with 2100 outlets and around 12,000 employees. An extensive range of services, individual advice and qualified specialist personnel are the collective attributes of the usually owner-run dealerships and specialist stores. With total revenues of EUR 3.35 billion in financial year 2006/2007, EURONICS is the second biggest market player of the industry in Germany.

EURONICS Deutschland eG is a partner of the European purchasing and marketing alliance EURONICS International based in Amsterdam. But for a few exceptions in Eastern Europe, the group is represented in all European countries. The alliance is currently operating with 25 members at over 11,500 locations in 28 countries and in 2007 realised total revenues of EUR 12.6 billion. More than 50,000 employees work for the 6300 member companies. In Europe, EURONICS is regarded as the biggest alliance of independent retailers in the industry.

For more information:

1. EURONICS Deutschland eG
Cornelia Bonow
Tel.:+49 (0) 71 56 / 933 403

2. Engel & Zimmermann AG,
Agentur für Wirtschaftskommunikation
Björn Seeger
Schloss Fußberg, Am Schlosspark 15, 82131 Gauting
Tel. +49 (0) 89/89 35 63 3, Fax +49 (0) 89/89 39 84 29

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