Status of the Romanian Dry Cleaning Industry in 2009
Release Time:
2010-02-05 16:30
Source:
Author: Cristina Zaman (Romania)
Cristina Zaman is the Executive General Manager of Nufarul, the leading laundry and dyeing service provider in Romania, and currently serves as the President of the Romanian Association of Dry Cleaning Services and Equipment Suppliers.
Background and Statistics
Undeniably, the current business environment has greatly impacted the service industry, and dry cleaning services are no exception, with industry demand declining by about 25%.
This is a downturn following a period of industry prosperity, with an average annual growth rate of about 15% since 2000.
Although market service turnover in 2008 decreased by 0.3% compared to 2007, the effects of the financial crisis only began to show at the end of 2008. Therefore, turnover in December 2008 was 19.6% lower than in December 2007, and in the first five months of 2009, market services provided to the population decreased by 11.2% year-on-year.
For dry cleaning activities, signs of recession appeared starting in October 2008, reaching the most severe point in January 2009, when turnover was down 27.8% compared to January 2008.
According to official statistics released in May 2009, market service turnover provided to the population in May decreased by 16.2% year-on-year compared to 2008.
The decline in turnover was mainly due to a drop in wet cleaning and dry cleaning of textiles and fur products (-21%). Although the turnover decline in this area was significant, our company Nufarul SA's turnover only decreased by 10%.
Current Adverse Trends in the Dry Cleaning Service Industry
Developments Driven by the Economic Crisis
- Changes in consumption behavior due to reduced household income have led to a decline in demand for the dry cleaning industry.
- Companies legally providing dry cleaning services face increasing pressure as they have to contend with unfair competition from the black market.
In the current poor business environment, the increased contribution of legal companies to the national budget and the growing number of unemployed people seeking jobs, regardless of whether the jobs are legal, have facilitated the development of the black market.
General Impacts
- Defective labels: Many manufacturers do not attach proper labels on their final products to indicate the fabrics used, so we often have to deal with incomplete or even completely missing label information. For those working in this field, having rich experience and knowledge about fabric properties and specific cleaning techniques is especially important.
- Rising electricity prices;
- Lack of a national legal framework for dry cleaning services to ensure service levels meet international standards;
- Lack of specialized agencies to prove and confirm to courts or quality regulatory bodies that dry cleaning services are properly performed according to standards, and that some stains may be due to incorrect labeling (such as fabric shrinkage or color migration) or long-term stubborn stains fixed into the fabric that cannot be removed.
- Although ecological/environmental legal requirements are becoming increasingly strict, this field still lacks government support. It would have been ideal to implement these requirements before the financial crisis, as current investments are constrained by liquidity limitations.
However, this financial crisis has also had some positive effects for our company. Recently, due to the increase in unemployment in Romania and salary reductions in other companies, the number of job applicants to our company has increased. Based on their applications, we can select more qualified personnel, and most importantly, choose more efficient, proactive, and enthusiastic staff.
Although many companies in our field have ceased operations, Nufarul SA has always invested with its own funds rather than bank loans, and its cautious development strategy still ensures that the company is safe, reliable, and trustworthy in the current economic context.
Business Optimization Measures
Maintaining High Quality
In our view, the success of dry cleaning business largely depends on service quality, and customer loyalty is easier to gain through quality accumulation than in other commercial fields.
The Romanian market is currently divided into two main segments: quick service (about 90%) and full-service (about 10%).
As for our company, we have not shifted our policy to provide the quick service that currently dominates the market but has lower service quality. Instead, we choose to offer our customers the high-quality standards they are accustomed to. Our strategy has earned customers' trust and continuously increased customer loyalty.
Service quality is fully guaranteed through the advanced cleaning technologies used, continuously trained professional staff, and the rich experience accumulated over 49 years since the company's establishment.
Continuous efforts to improve customer service quality and customer loyalty
This is not only related to the quality of service we provide to customers but also to the specific activities we carry out to achieve our goals.
Among these, we focus on strengthening customer communication, explaining whether stains can be successfully removed based on fabric type, the professional cleaning techniques used, providing fabric care advice, showcasing the wide range of services our company offers, especially home pick-up services, and so on.
Moreover, based on the knowledge we have gained over the past two years as an IDC member country, we strive to make customers enjoy a more pleasant service experience at our centers. We have arranged dedicated areas where customers can enjoy free refreshments (coffee, tea, sugar) and read newspapers.
Advertising
Currently, we mainly publish articles related to our field of activity in national newspapers.
The current economic downturn has undoubtedly changed and will continue to change our mindset and strategy, favoring a return to cautious cost management, quality, and innovation concepts to maintain the customer base and cope with increasingly fierce market competition.
Looking ahead, we will certainly strive toward the positive outcomes that the current environment should bring. We will improve business efficiency, meet customer interests through innovation, and the company's high-quality marketing services and products will consolidate its market position and achieve reasonable profits.
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