Home-appliance giants head for Poland

By Hilary Davies

Of the two brands that make up the German Media-Saturn holding, 'MediaMarkt' already has 77 shops situated in major Polish cities. According to the general director of MediaMarkt, Jarosaw Drabarek, the 12 'Saturn' shops to appear from 2004 won't differ much from their sister brand since they will be targeting a similar group and offering the same brands of electrical appliances.

"The idea is that we will be able to offer customers a choice," says Drabarek. "And that the products at Saturn will be slightly more high-tech."

According to the plans, Saturn shops will also be significantly bigger. The first Saturn, planned to open at the Arkadia shopping mall, will actually take up 6,000 square meters, and later shops may even go up to 10,000 square meters.

According to Piotr Byrski of the consulting firm PML Limited, MediaMarkt currently controls about ten percent of a market where the leader is the Polish-owned Avans. Avans currently has 600 franchises all over Poland and a market share of 20 percent. In November 2002, Avans joined a Pan-European association of independent chains, Euronics, which is one of the leading buying groups in Europe, has a presence in 22 countries and a total of almost 9,500 stores.

Representatives of the Polish franchise chain declined to comment on the move by Metro AG, but in Byrski's view, neither MediaMarkt nor Saturn represent direct competition for Avans, which consists of small shops, often situated in small towns. By contrast, MediaMarkt and Saturn are vast warehouse format outlets situated on the outskirts of big towns and cities.

However, recent noises made by the British group Dixons may constitute a threat to Media-Saturn itself. Dixons' 'Electroworld' has already been competing with Media-Saturn on the Hungarian and Czech markets since 2002, and plans to open four more shops in the Czech Republic as soon as possible.

In a presentation two months ago, Dixons stated that it is planning a 50 percent growth in sales on overseas markets, focusing particularly on central European markets where it can take up a number one or number two position.

Not surprisingly, many are taking this to mean Poland. Dixons' press office was unwilling to confirm the rumors, but conceded that Dixons' coming to Poland is: "A likely prospect."