The crisis changed Centrofarm’s strategy

“We are opening six pharmacies this year, to reach 68 at the end of 2009. It is little, the initial plans were much higher, but part of the shopping center projects have been postponed or canceled. Moreover, each newly opened pharmacy generates losses, and needs about two years to reach the breakeven point,” Catană told Business Standard.

The strategy change at Centrofarm is part of a more ample trend of optimizing the development of pharmacy networks, considering that other chains, such as City Pharma and Sensiblu, announced the closing of a significant number of units. “Some of the newly opened shopping centers were below expectations. There were cases when the malls opened without at least an 80 percent occupancy rate, such as Armonia in Brăila or the mall in Bacău. Others had traffic far below estimates, for example Armonia Arad, Era Iaşi, Galleria Buzău, especially malls outside Bucharest,” Catană added.

Centrofarm registered a 46 percent increase in net sales in the first six months of this year, to €15.72 million, on a market which rose by 10-15 percent, but the company’s growth rate is below the budgeted percentage. The growth rate of the Centrofarm business was 56 percent in the first quarter, compared to the 21 percent increase in the market, but the company’s development slowed in the second quarter.