War of the words among Swedish electronic retail giants as Media Markt sneers back at ElgigantenFriday, 04 November 2011
The war of words among Swedish electric good dealers could usher in a new era of what may refer to as bully competition in Sweden. In a sector that is very tight neat and supposed to have been dominated by Swedes with strong connections, entered German Media Markt with full force some few years ago. It has forced the likes of resistant-to-change-to-to-dynamic-market-trends Onoff off the market and now the seemingly next “bully” is Elgiganten.
Media Markt is low prices electronic dealer just like Elgiganten but it has been growing rapidly in Sweden though reporting persistent looses in the past years.
AdvertisementElgiganten too is a so-so priced electronic dealer but it has been doing well in the Swedish market – likely better that Media Markt. For this and, probably as a means to make Media Markt to loose focus, the CEO of Elgiganten took a swipe at Media Markt last week saying that Media Markt will be the next Onoff. Clearly, he means that Media Markt will soon fall just as Onoff drove off the road, crashed and burnt.
But Media Markt Sweden is no small mama’s child willing to run home and cry to mama that he has been bullied on the play ground. Media Markt is a big boy who came to this market knowing that it will take long stint to penetrate its core. The zeal and the stamina to withstand bullies was also part of the cocktail to build the force of resistance. This is why the CEO of Media Markt Sweden, Christian Schrahe hit back at Elgiganten sneering that “I think he's out on some shaky ground."
"When I look in our stores, I see only one thing - positive development, "he continues.
Elgiganten’s CEO, Anders Nilsen had said on Friday, to Swedish media that Media Markt would be the next Onoff. Media Markt, according to Anders Nilsen, has lost Skr1.1 billion over the past five years.
In terms of losses and the size of it, it’s obvious that Media Markt is next in line to fail, Nilsen had said in an interview with Swedish business daily, Dagens Industri. At the same time, according to Nilsen, Media Markt continues to open new stores
Christian Schrahe contested that people can say what ever they want and to live on their defined assumptions “but we do not comment on our results," says.
He would also not comment on Elgiganten’s results. "I would never speak about what I think about their performance in the industry today," he says.
Earlier this year, Media Markt opened a new store in Malmö. During the fall, four more stores are to be open, two in Stockholm, one in Luleå and one in Kristianstad.
"We look forward to a fantastic autumn with four new openings for the Christmas season. For us this is a very exciting period, "says Christian Schrahe.
"All our stores have improved their performance dramatically in the last year and we have several stores that are profitable this year, "he continues.
He did admit that it's a tough situation for many traders at the moment, not least because of the debt crisis in southern Europe.
"Concerns in Europe psychologically affects even countries that are doing well, like Sweden," he says.
"We must be cautious and review our costs every day, "he continues.
On the whole, analysts say that there is great price pressure especially in the electronics trade. This also is being described as a "golden opportunity for consumers. As such Christian Schrahe would not call it a price war.
"I do not think that customers perceive it that way. They expect very low prices and they find us. I think that consumers are happy that we are driving prices down, "he says.
Media Makts is owned by German Metro AG
By Scancomark.se Team
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