Pandora buys a 78 units fashion store network in Germany and will convert it to self-operated Pandora-stores where the landlords approve.
“This will be a significant strategic step for Pandora in Germany, which accelerates our strategic plan for this market,“ Niels Møller, President Pandora Central Western Europe, said.
Pandora has today entered into an agreement with DHG Gmbh (DHG) to assume up to 78 commercial leaseholds in Germany currently trading under the BiBa name (a ladies fashion brand) by the 31st January 2015, when negotiations with landlords are expected to be finalised.
Pandora says it will pay a service fee to DHG for making the leaseholds available to Pandora. The amount of this fee will be dependent on the number of leases successfully assigned.
“We have carefully mapped the German market, in terms of how an ideal concept store network would look in the country. With this agreement, we have now in one strategic move gained immediate access to a very large proportion of the desired locations”,Allan Leighton, CEO at Pandora, said.
All commercial leaseholds concern stand-alone stores all located at prime locations in Germany fitting well into Pandora’s existing concept store expansion strategy in Germany.
Pandora will then in the coming year open owned and operated concept stores in the new locations, some of which will be a relocation of already existing Pandora- owned stores. A number of these stores may over time move back to franchise stores.
The total investment for the new stores, including establishment and relocation of stores (including initial stock in the stores), costs related to temporarily inactive storesin the transition period, service fees to DHG as well as all other costs related to the store implementation, is expected to be around 50 million EUR.
Germany is one of Pandora’s core markets and generated revenue of 372 million DKK in the first nine months of 2014, corresponding to an increase of 8.1% compared to the same period in 2013.
As of today, Pandora owns and operates 61 concept stores in Germany out of a total of 83 concept stores in the country. The German jewellery market is one of the largest in Europe and in 2013 had a value of 3.9 billion EUR.
Biba today operates on eleven markets, the only store in Scandinavia is found in Drammen, Norway.