Hardware stores beat crisis as Germans take to nesting
The Local · 31 May 2010, 16:36
Published: 31 May 2010 16:36 GMT+02:00
According to news magazine Der Spiegel, German home improvement chains such as Obi and Hornbach bucked the recession last year.
Experts describe the trend as “homing,” when people choose to stay home and nest instead of spending money on vacations, the magazine said.
“The trend strengthened in the recent recession,” branch analyst Christoph Schlienkamp told the magazine.
Many in the industry also managed to make it through the hard winter of 2010 without much damage, with an average of 2.3 percent in gains for the first quarter.
And even though gardening sales are in jeopardy thanks to an unusually rainy and cold May, many chains are expanding and giving up on price wars, though not always to positive effect, the magazine said.
Praktiker has stopped its “20 percent off everything” campaign and now has about one quarter of its 441 locations in countries outside of Germany. But many of the new Praktiker stores are in eastern Europe, which has not had a stabilising effect on earnings.
Meanwhile Hornbach, which only has 11 of its 131 stores located in eastern Europe, is doing relatively well, Schlienkamp told the magazine.