New superstore eyes opportunity on the home front
The Warsaw store, Dom i Ogrod (House & Garden), is the city's first do-it-yourself superstore. It is also the first step in a $20 million investment plan that includes launching up to 10 superstores countrywide.
"This is no new invention," said Eligiusz Sidor, general director of TTW's Polish operations. "We don't offer things you can't buy elsewhere. We simply offer all types of merchandise necessary to refurbish your home and we do it under one roof."
"The market is very interesting, because of its lack of organization," Sidor said. "There are many companies which offer merchandise for home remodeling but there aren't any which offer a large choice under one roof."
TTW's Warsaw store offers 50,000 articles for sale ranging from sheet rock to light bulbs. Sidor said that although they are just starting up, they are confident their venture will succeed by offering choice and reasonable prices.
"High prices can be demanded in small, luxury shops in the center of town. But for us, volume counts the most, and to have a high turnover you have to be well organized and the prices have to be competitive," he said.
TTW currently has 15 stores and 1,000 employees in Germany and Ukraine. Total revenue for 1994 was over $80 million. In Poland, Sidor said, they plan to sell almost $1 million in home improvement supplies monthly with 110 employees.
"This is a fairly cautious estimate," Sidor said. "In reality we can have much better results, but we are counting on old zl. 20 - 30 billion ($800,000 - $1.2 million) monthly at the beginning."
Although much of their business now is targeted toward those trying to keep up with the "Kowalskis," Sidor said they are counting on more construction companies, especially smaller ones, taking an interest in stocking up at Dom i Ogrod.
"They can save a lot of time, money and gas coming here for one stop instead of looking for someplace cheaper. Of course, buying directly from the warehouse can save a little money, but how much time do you waste," he said.
To pull in more corporate clients, TTW is planning to offer discounts to companies that buy in bulk. Sidor said they are currently working on an agreement with one housing cooperative for providing interior furnishing materials for a Warsaw housing development.
In Warsaw Sidor said TTW's main competition will be from the Bartycka market where many construction and home refurbishment companies currently buy their materials. But he added that with time people will prefer the convenience of everything under one roof.
"Bartycka, generally speaking, is too spread out. A lot of small stores, the same merchandise in many of them, and it seems when you go there that they have everything... until you need to buy something specific," Sidor said.
Dom i Ogrod also plans to offer construction and installation services in the near future. "The problem now," Sidor said, "is distinguishing between good and bad remodeling companies. As people trust our products, they will be able to trust the companies we sub-contract work to."
TTW-Warszawa was established in late 1993 as a Polish limited liability company, and not a joint venture, to handle TTW's Polish operations. The partners in the company are TTW GmbH, which provided DM 3 million ($2.1 million) in equity plus store furnishings. The Polish partner and board chairman, Krzysztof Kolaszewski, provided the 1.5 hectare site for the store. Both partners have equal shares in the company.
Kolaszewski is no stranger to the retail business. He has already established a children's clothing chain called 5 - 10 - 15 with two stores in Warsaw and one each in Gdynia and Poznan.
Sidor said TTW had considered entering the Polish market, one of the largest in the region, for some time but had been unable to find the right partner. He added that this isn't TTW's first experience out of their native Germany.
TTW currently operates nine stores in Ukraine, including two in Kiev, under the name TTW - Home. Sidor said TTW entered Ukraine because the current lack of competitors indicated potential for profit. Although the Ukraine operation has three more stores than in Germany, those stores are smaller than those in the Western outlets.
About the Polish venture, Sidor said: "Everyone is talking about the construction crisis, and when you look at official figures they're right.
"But when you look around you see there's construction everywhere," he said. "That's why we see very interesting prospects for business."
"This is no new invention," said Eligiusz Sidor, general director of TTW's Polish operations. "We don't offer things you can't buy elsewhere. We simply offer all types of merchandise necessary to refurbish your home and we do it under one roof."
"The market is very interesting, because of its lack of organization," Sidor said. "There are many companies which offer merchandise for home remodeling but there aren't any which offer a large choice under one roof."
TTW's Warsaw store offers 50,000 articles for sale ranging from sheet rock to light bulbs. Sidor said that although they are just starting up, they are confident their venture will succeed by offering choice and reasonable prices.
"High prices can be demanded in small, luxury shops in the center of town. But for us, volume counts the most, and to have a high turnover you have to be well organized and the prices have to be competitive," he said.
TTW currently has 15 stores and 1,000 employees in Germany and Ukraine. Total revenue for 1994 was over $80 million. In Poland, Sidor said, they plan to sell almost $1 million in home improvement supplies monthly with 110 employees.
"This is a fairly cautious estimate," Sidor said. "In reality we can have much better results, but we are counting on old zl. 20 - 30 billion ($800,000 - $1.2 million) monthly at the beginning."
Although much of their business now is targeted toward those trying to keep up with the "Kowalskis," Sidor said they are counting on more construction companies, especially smaller ones, taking an interest in stocking up at Dom i Ogrod.
"They can save a lot of time, money and gas coming here for one stop instead of looking for someplace cheaper. Of course, buying directly from the warehouse can save a little money, but how much time do you waste," he said.
To pull in more corporate clients, TTW is planning to offer discounts to companies that buy in bulk. Sidor said they are currently working on an agreement with one housing cooperative for providing interior furnishing materials for a Warsaw housing development.
In Warsaw Sidor said TTW's main competition will be from the Bartycka market where many construction and home refurbishment companies currently buy their materials. But he added that with time people will prefer the convenience of everything under one roof.
"Bartycka, generally speaking, is too spread out. A lot of small stores, the same merchandise in many of them, and it seems when you go there that they have everything... until you need to buy something specific," Sidor said.
Dom i Ogrod also plans to offer construction and installation services in the near future. "The problem now," Sidor said, "is distinguishing between good and bad remodeling companies. As people trust our products, they will be able to trust the companies we sub-contract work to."
TTW-Warszawa was established in late 1993 as a Polish limited liability company, and not a joint venture, to handle TTW's Polish operations. The partners in the company are TTW GmbH, which provided DM 3 million ($2.1 million) in equity plus store furnishings. The Polish partner and board chairman, Krzysztof Kolaszewski, provided the 1.5 hectare site for the store. Both partners have equal shares in the company.
Kolaszewski is no stranger to the retail business. He has already established a children's clothing chain called 5 - 10 - 15 with two stores in Warsaw and one each in Gdynia and Poznan.
Sidor said TTW had considered entering the Polish market, one of the largest in the region, for some time but had been unable to find the right partner. He added that this isn't TTW's first experience out of their native Germany.
TTW currently operates nine stores in Ukraine, including two in Kiev, under the name TTW - Home. Sidor said TTW entered Ukraine because the current lack of competitors indicated potential for profit. Although the Ukraine operation has three more stores than in Germany, those stores are smaller than those in the Western outlets.
About the Polish venture, Sidor said: "Everyone is talking about the construction crisis, and when you look at official figures they're right.
"But when you look around you see there's construction everywhere," he said. "That's why we see very interesting prospects for business."
