Because foreign currencies, mainly the euro and the dollar, have appreciated by more than 8 percent in the past 30 days, companies are trying to protect themselves against the exchange rate variations.
“In our relation with resellers, where payments are made within 15-30 days, we are using various exchange rate adjustments. There are cases when this is not possible. At such times, exchange rate variations impact on our profit margins, which are minor in our industry, sometimes even below the exchange rate variations,”“ said Docentris Sales Manager, Radu Ionescu. Docentris is part of the Scop Computers group, one of the top IT distributors on the local market.
Net profit margins in IT distribution in Romania are currently at some 2-3 percent, and are estimated to drop below 1 percent in the coming years.
Another major distributor, Asesoft Distribution, lost some €60,000 last year due to exchange rate variations, according to the company’s General Manager, Iulian Stanciu. This year, no losses were registered, although there could be year-end losses as foreign currencies usually appreciate in the fourth quarter, Stanciu added.
