Italy: Rapid-growth formula

DIY in Europe discussed the strategy and rapid growth of the Cantú-based franchise organisation with two of its members, Simone Chiapasco and Dave Steward.
The number of Brico OK outlets has increased rapidly.
Brico OK is developing at an incredible rate. What is your secret?
Chiapasco: We put a great deal of work into the organisation, with two areas in particular affected: negotiations with suppliers and advertising activities. The members get together twice a week, when we “do battle” with our suppliers for the best prices and products, towards which we then orientate our promotional activities.
Simone Chiapasco
You are indeed very active in this respect.
Chiapasco: It is indispensable. Frequent advertising is extremely important. It serves to develop customer loyalty and compensates for the limits imposed by the size of our stores. We have to try to tempt customers away from the big stores because otherwise we risk losing them.
Exactly what form do your advertising efforts take?
Steward: We print a newsletter every week, we distribute flyers six times a year, and we stage an “Everything you need for………” campaign twice a year. What is more, we place on average two pages of advertisements per month in the biggest local daily papers. In addition, each advertising campaign is linked to a specific special offer.
Dave Stuard
Do you follow any particular example?
Chiapasco: Above all German DIY chains that offer a “hard” DIY range, even though we have very recently been carrying out tests with regard to female consumers and in this respect getting our inspiration from French models.
What are your specialist product categories?
Steward: We stock twelve product families altogether, most specially wood and hardware. Wood understood both as a raw material and in the form of brackets, for example. Our wood cutting service is especially interesting, even though it represents a loss in financial terms: it is in fact a service that exerts tremendous influence on customer loyality. In one store at Olgiate Comasco, for example, we have two wood-cutting machines that operate non-stop on Saturdays.
You concentrate mainly on the north, but you are also represented in central and southern Italy. Where do you find differences?
Steward: There are none between. northern and central Italy. But the situation is different in Sicily, the market is more aggressive and so the profit margins are lower. But it is still an area offering great potential. Plastic furniture sells there ten times better than in the north, and so do housewares and carports.
Who are Brico OK’s customers?
Chiapasco: Trade customers make up between eight and ten per cent of our clientele, DIYers 20 to 25 per cent, and occasional customers make up the balance. We are at present testing our product offer for women customers following a French model. We have taken furniture into our assortment, as well as quick-selling housewares. We have developed the Ideamobili format for furniture as a section that is situated next-door to the DIY store on an area covering 500 m2.