Business Review

There are 28,000 Italian firms in Romania which employ 800,000 local workers, and their contribution to the local GDP is 10 percent. Adding the money sent home by Romanian workers in Italy, the percentage doubles. There are almost 700,000 Romanians working legally in Italy, around 20,000 of whom have started their own small and medium companies there.

Some of the companies that run cinema halls, either because they own them or they have administration rights over them, can make a pretty profit from renting their movie theaters for various events, other than film screenings attended by the general public. Given that the cost of renting a hall in a highly reputed hotel can be anything between EUR 2,500 and 5,000, renting a movie theater can be a less expensive option for corporations that wish to organize events without being left with a considerable hole in their budget.

On the local management consultancy market, which has a value of approximately EUR 4 million and around 1,000 players of various sizes, consultants' fees are three-four times lower than those of their counterparts working in Western European countries. The Romanian market is on the same footing with other countries in the region but not nearly mature enough to reach the level of the West. Still, most consultancy firms are confident this year will be one of solid growth.

Sales of the major car firms on the local market have been in free fall since the beginning of the year, company figures show, and even lower prices have failed to temper the slide. Expansion plans have been postponed or scaled back, with Porsche Romania for example finishing its Bentley showroom six months later than scheduled. And the market shows no signs of improvement, which car company officials blame on the difficult access to financing and fiscal barriers.

One category of executive training programs that is set apart, given its potential in boosting career and earnings, is MBA programs. Companies which provide MBA programs believe that the local MBA market exceeded EUR 3 million last year, with estimations going up to EUR 5 million for the market value.

Recruitment firms are currently finding themselves the victims of a chain reaction: companies in various sectors hit by the crisis are no longer employing staff, and when they do, they prefer to use their internal human resources departments in order to save money. Sectors such as real estate, the car industry, construction and banking are the least active in hiring and the most exposed to lay-offs at the moment.

Special offers and promotions are the words of the day for consumers who started tightening their belts and for companies which saw their sales shrinking. Although companies go for lower profit margins, they are employing various marketing strategies to keep the flow of customers and ideally increase sales - be it in fashion retail, stock market trading or holiday packages.

While the beer market won't grow this year, brewers are going against the tide and cracking on with investment plans. Just last week, Ursus Breweries completed a new set of investments in one of its production units in Buzau, while Heineken Romania has also announced it intends to go ahead with its plans for this year. Both firms have also released on the market new products which they aim to promote with marketing campaigns.

Telecom operators are keeping their fingers crossed that the customers who are already hooked on premium and high-end handsets will not ditch them. The most popular handsets last year included the iPhone 3G, HTC Diamond, BlackBerry Storm, Samsung Omnia, Nokia N95 8Gb and Nokia N96. While the mobile handset market is expected to decline, both globally and locally, players say this particular segment will not be affected by the recession.

Local petrochemical producer Oltchim needs a EUR 620 million shot in the arm, for which EC authorization is needed. Company officials say that part of the sum represents state debt converted into shares and the rest loans for which state warranties might be asked. Constantin Roibu, Oltchim GM, tells BR that the company's first priority this year is to integrate its raw materials supplier, the petrochemical division Arpechim, into Oltchim operations - a costly plan as the company has been put in the E risk category for banks, which means high interest rates.