Maintaining market share against the odds

Hagebau is a medium-sized group which combines builders’ and timber merchanting with the retail trade. In the core specialist builders’ supplies business Hagebau occupies number one position among the medium-sized German trading groups. The Soltau-based group also claims to be market leader in Germany in the timber trade. The Hagebaumarkt retail channel is ranked fourth in Germany by turnover. Currently there are 250 independently operating builders’ merchants affiliated to Hagebau. They are represented by 926 locations in Germany, of which 537 are specialist builders’ merchants, 95 are timber merchants, and 345 are Hagebaumarkt outlets inclusive of garden centres. Through its Midas project, involving realignment in the end-consumer area, Hagebau is now facing new challenges. Noticeable lull in construction Hagebau’s centrally regulated turnover, including associated companies and central warehouses, last year amounted to 2.702 bn euro (DM 5.285 bn). This corresponds to growth of 1.2 per cent over 1999. Michael Baumgardt: "The Hagebaumarkt stores have held their ground in a difficult environment"The specialist building materials and timber trade accounted for 1.52 bn euro (DM 2.973 bn) in 2000. This means they almost achieved the previous year’s result (1.541 bn euro/DM 3.105 bn). The current 293 German Hagebaumarkt outlets, two garden centres and 50 Hagebau compact stores increased their combined turnover invoiced through the Soltau central office by 4.6 per cent over 1999 to 908 mio euro (DM 1.8 bn). This figure indicates that they were the engine of the group’s overall growth. A figure of 1.506 bn euro (DM 2.945 bn) is put on external turnover for 2000. As a result, the stores with the red-and-green logo have gone up from fifth to fourth position in the German DIY superstore rankings. As was already the case in 1999, the garden product offering proved still to be the sector with the strongest growth in the retail line of business. Sales here are 12.4 per cent above the previous year’s figures. “The garden sector is heading for a share of turnover in excess of 30 per cent,” says Michael Baumgardt, managing director sales and marketing. Until now the share has come to just under 30 per cent. With its 192 garden centres the group finds itself currently at second place in the branch. In 2000 the central buying volume over all the channels of distribution grew by five per cent to 511 mio euro (DM 1 bn). Last year the five central warehouses accounted for a…