EUR 1bn in sales revenue from foreign subsidiaries in the year 2020 is the target of Inter Cars.

 
Besides Poland, where Inter Cars is an unchallenged leader in distribution of automotive spare parts, accessories and garage equipment, the company operates on 13 markets, from Estonia to Italy and Bulgaria. Foreign subsidiaries of  Inter Cars are divided into two groups - North (Baltic States and Ukraine) and South (other countries of the region). Expansion is being realized on both directions - this year IC Estonia started operations, next, in the south, in Slovenia and Italy the company is creating sales structures. 
 
"Thanks to our international team, composed of specialists from many different countries, we are able to use our extensive expertise, which allows us to accelerate development and entering new areas of operations. Thanks to this we can expect to cross the level of EUR 1bn turnover till 2020" - said Tomas Kastil, responsible for Inter Cars South. 
 
The way of reaching this ambitious target is concentrating on taking advantage of potential of 13 markets, on which Inter Cars is currently present. "On every of those markets we want to be an important company, i.e. be among the top 3 of local distributors. If the area for development starts ending in our core business, i.e. distribution of automotive spare parts for passenger cars, we can also move to distribution of spare parts for light commercial vehicles, motorbikes, and also garage equipment, lubricants, wheel rims, tyres, batteries or accessories" - explained  Krzysztof Soszyński, vice-president of the board of Inter Cars. 
 
Let's have a look at the current situation of foreign subsidiaries of Inter Cars, looking from the North to the South:
  • Estonia - a company which is just starting, plan for 2015 is to open the first branch and start selling
  • Latvia - present on the market for 5 years and is No 3 in the country. Sales revenue in 2014 amounted to PLN 85.2m, after the first five months of 2015 the company recorded a sales increase by 95.7 percent, in comparison to the same period a year before.
  • Lithuania - 10 years of activity and the first place with market share of around 20 percent. The sales revenue for the previous year reached PLN 161.3m, this year - after five months - there is an increase by 9.5 percent.
  • Ukraine - 20 branches are operating there, and IC Ukraine is No tree in the country. Sales in 2014 was worth PLN 117.7m, the increase in 2015 - despite difficult political situation is 12.3 percent.
  • Czech Republic - after 11 years of activity, on the third position in the country, with sales revenue in 2014 of PLN 124.4m and increase in 2015 by 15.3 percent (in comparison to the period of January - May 2014)
  • Slovakia - local subsidiary of IC is No 2 on the market, and within the next two years it should become a market leader. Sales in 2014 - PLN 126.3m., an increase in current year - 16.2 percent.
  • Hungary - by now number 5 in the country, but after changes in franchise system the subsidiary started developing really fast. Sales revenue in previous year reached PLN 56.6m, and in current year the company recorded a 102-percent increase.
  • Romania - after 7 years of activity, number three on the local market, but for its tenth anniversary, IC Romania wants to become the market leader. The company's sales revenues in 2014 reached the level of PLN 271.3 million. After the first five months of 2015 the company recorded an increase by 45.6 percent.
  • Slovenia - local company which started its operations back in 2014 and today has only one branch. Within just two years it should have branches all over the country.  Sales revenues for the period of January to May 2015 amounted to PLN 2.6 million. 
  • Croatia - in the second place and with ambitions to develop the local chain of Q-Service garages in order to become the main alternative for OE garages. Sales revenue in 2014 reached PLN 110.6m, and in current year the company recorded a 22-percent increase.
  • Italy - organization in this country was inherited by IC from JC Auto, but introducing local system of franchise branches has just started, totally different than the system of multi-level distribution used in Italy. Sales revenue in 2014 reached PLN 22.6m, and in current year the company recorded a 31-percent increase.
  • Bulgaria - within the last four years, starting from zero level the company became number two in the country and is striving to become number one. Sales in 2014 was worth PLN 92.9m, the increase in 2015 - the highest in the whole group - reached the level of 129.2 percent.
 
In total sales revenues of foreign distribution subsidiaries of IC in 2014 reached the level of PLN 1,142bn, and in the first five months of 2015 it increased by  36.4 percent in comparison to the same period a year ago. 
 
"With three times higher sales growth in our foreign distribution, sales revenues from domestic market will soon represent minority share in total revenues of the whole Group of Inter Cars" - summarized Krzysztof Soszyński. 
 
 
What is behind such a fast development of foreign companies?  It turns out that the most depends on... ability of local managers. At the very beginning they get access to knowledge base of Inter Cars ("library") and can use the experience of other managers from the Group. Next they are operating quite independently and only after reaching the level of turnover greater than EUR 20 million annually, they are being adapted to the standards of the Group. "Of course, still kinds of promotion or the product range are adapted to the needs of local market and the size of local shelves. Small companies cannot afford to keep all the brands on stock or the full portfolio of products" - explains Krzysztof Soszyński. However many solutions tested in Poland are being transferred to the countries of the region.  "We are cooperating with local schools and universities, in order to gain future candidates to work, as in those countries there are the same restrictions and limitations as in Poland" - added Krzysztof Soszyński. 
 
 
The only country in which further development is a big question is Ukraine.  "Admittedly, we are recording sales increase in hryvnia, but in euro we are losing. We were hoping that Ukraine will be a kind of a bridge to markets, which will be growing for the next 30 years, but currently we are not able to do anything about that. We are there, we are operating, and we have a team which we do not intend to leave behind, as Inter Cars has never left anyone behind.  We are trying to take the most of the conditions we are operating in" - declared Krzysztof Soszyński. 
On another markets, plans for the future include, among other things, creation of Q-Service garage chain and local Motointegrator portals.  
 
Source: Motofaktor 
2015-06-29 
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