Introduction to the main Finnish DIY/ Building Materials Chains
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Introduction to the main
Finnish DIY/ Building
Materials Chains
July 2017
Flanders Investment & Trade
c/o Embassy of Belgium in Helsinki
Aleksanterinkatu 17
00100 Helsinki
Tel. +358 9 62 62 33
helsinki@flanderstrade.com
Contents DIY sector in brief .................................................................................................................................... 3 DIY/ Building Materials Chains ................................................................................................................ 5 1. STARK............................................................................................................................................... 5 2. K Group/ K-Rauta............................................................................................................................. 5 3. S Group ............................................................................................................................................ 6 4. Hankkija ........................................................................................................................................... 7 5. Bauhaus ........................................................................................................................................... 7 6. RTV................................................................................................................................................... 8 7. Hartman........................................................................................................................................... 8 8. Värisilmä / Väritukku ....................................................................................................................... 9 9. Puumerkki........................................................................................................................................ 9 10. Puuilo ........................................................................................................................................... 10 11. Byggmax ...................................................................................................................................... 10 12. Motonet....................................................................................................................................... 11 13. Netrauta Finland.......................................................................................................................... 11 14. Taloon.com .................................................................................................................................. 11 DIY sector in Finland: sales 2014-2016.................................................................................................. 12 Introduction to the main Finnish DIY/ Building Material Chains I July 2017 2
DIY sector in brief The Finnish hardware store chains have had a few tough years economically. According to Rasi, the Finnish Hardware Association, the hardware sales went down for years until late 2016, when the growth returned. This growth is expected to continue in 2017 and 2018. According to an industry pre-survey, conducted in December 2016, the hardware sales have risen over 4% since October 2016. According to Statistics Finland at the beginning of this year (January to April 2017) the growth was 1,9%. The growth in sales is due to the growth in the construction sector (around 6 to 7%). Construction is focused in the growth centres, meaning certain cities, where new apartments are being build. The Finnish DIY chains do not only serve private consumers, but also the professional building sector. The percentage of the sales for professionals and consumers vary from chain to chain. For example K Group expects their B2B-sales to increase (as part of this strategy they recently bought HVAC specialist Onninen as increasingly more technology is being brought into buildings). DIY chains especially serve small and medium sized construction companies, which has allowed the hardware stores to increase their sales with the current boom in construction. They also serve bigger construction companies although they often purchase materials from elsewhere. In the market for detached houses, turnkey houses are increasingly popular which leaves less space for the DIY sector in the construction phase. With the economic climate in the past years (challenges in the Finnish economy) people have been keener on renovating old houses than on building new ones. It remains to be seen what the future brings as the economy is currently showing very positive changes. Many Finns own summer houses build before the 1970s. So, renovating summer houses will remain important. In total there are 502,900 summer houses in Finland (2016). The annual sales of all hardware stores in Finland amount to approximately € 4 billion: construction supplies account for over a billion euro, timber for € 900 million and the rest come from other supplies like wallpaper and machinery. K Group is the market leader with a market share of 40%. Stark is the second largest with 20% of the market share and is also the largest of foreign hardware chains in Finland. S Group, the biggest competitor of K Group in retail on the other hand, only has 10% of the market share and is having difficulties finding its role in the sector. In an article published in August 2017 S Group’s CEO, Taavi Heikkilä says that the group is focusing on developing Kodin Terra and the DIY sections of their Prisma hypermarkets by, for example, increasing their selection of hardware products. Some foreign chains have tried to gain market share in Finland, but they have been largely unsuccessful. The role of e-commerce in the hardware business is not the same as in regular retail. Usually customers can purchase their item(s) online and have them delivered to their home address. On the hardware online stores consumers also purchase their item(s) online, but then usually pick it up at the store themselves. Customers also use the service to compare prices and study the products. The estimate of online purchases in the sector is around 2% (compared to e.g. electronics of which a quarter is bought Introduction to the main Finnish DIY/ Building Material Chains I July 2017 3
online in the Nordics). However it is expected that purchasing online will increase significantly and all
the main DIY chains already have a webstore.
In the consumer field, the sector is going from ‘do-it-yourself’ to ‘do-it-for-me’, i.e. DIY chains offer
more service, focus more on interior decoration and follow the newest trends more closely.
The DIY chains are also receiving an increasing amount of female customers who are generally more
interested in interior decoration than men.
A new trend in Finland is ‘having a living room on your own yard’. Consumers buy furniture for their
yards because they want to spend more relaxing time outside. Wood used to be the main material for
outside furniture, but now a days consumers mostly buy furniture made out of Poly Rattan and
Polywood®. People also want to expand their patio. Instead of just having a table and few chairs on
the patio, consumers want couches and armchairs outside as well.
Sources: Kauppalehti 8.12.2016, Helsingin Sanomat 21.10.2016, Talouselämä 2016, and Statistics Finland stat.fi, Kauppalehti
8.8.2017, Kauppalehti 11.8.2017
Introduction to the main Finnish DIY/ Building Material Chains I July 2017 4DIY/ Building Materials Chains 1. STARK The STARK chain emerged in the spring 2014 when Puukeskus chain was acquired by DT Group which already owned Starkki DIY chain. Puukeskus was a leading supplier of timber in Finland. STARK is thus part of DT Group and the global Wolseley Group, the largest construction-sector enterprise in the Nordic countries. STARK’s (DT Finland Oy/ Starkki-Puukeskus) taxable sales in 2016 amounted to nearly EUR 750 million, with the headcount being approximately 1,200. STARK chain sells approximately 80% of its products to professional builders. Last fiscal year Starkki’s turnover was good for EUR 620 million. Currently STARK serves its customers in Finland through a network of 28 stores and via its online store. The chain closed six of its stores in the spring of 2017 (in the cities of Kouvola, Kotka, Tornio, Savonlinna, Järvenpää and Hyvinkää). They have one store in Estonia. Their product range is geared towards serving professionals in construction and industry, as well as in new development, renovation and repair projects. DT Finland Oy Lyhtytie 1 00750 HELSINKI (Head Office and Helsinki Metropolitan Area Distribution Depot) Helsingintie 50 15100 LAHTI (Chain Management and Central Warehouse) PL 26 15101 LAHTI T +358 (0)44 475 3000 www.stark-suomi.fi/ Mr. Kari Wahlman, Sourcing Director kari.wahlman@stark-suomi.fi Contact details of category managers (in Finnish): www.stark-suomi.fi/fi/stark/tavarantoimittajille 2. K Group/ K-Rauta Customers of K Groups retail chain K-rauta are mainly people who are building a home, renovating or decorating it. Professional customers include construction companies, industrial companies and public entities. The retail sales of K Groups retails chains were good for EUR 1582 million euro in 2016. Introduction to the main Finnish DIY/ Building Material Chains I July 2017 5
The K-Group´s market share in the hardware sector is around 40% (own estimate). K Group used to operate another chain called Rautia in addition to K-rauta, but the two are integrated in the spring 2017 to new K-rauta. K-rauta combines the two brands into one and will have 139 stores. In 2017 K Group bought Onninen (www.onninen.com) focusing on the HVAC-sector. Tikkurilantie 10, Vantaa P.O. Box 75, FIN-01301 Vantaa Finland T +358 10 53032 www.k-rauta.fi / www.kesko.fi 3. S Group The S Group comprises of cooperative enterprises and Suomen Osuuskauppojen Keskuskunta (SOK) with its subsidiaries. The S Group provides services for the supermarket trade, the service station store and fuel trade, the department store and specialty store trade, the tourism and hospitality business, the automotive and accessories trade as well as the agricultural trade. The S Group’s purpose is to provide services and benefits for members. Hardware department: At the S Group, you can find building and renovating equipment, whether you are an agricultural builder, a renovator of an apartment building or the builder or renovator of a house or townhouse. S-Rauta and Kodin Terra offer expert hardware store service. Garden department: Kodin Terra provides instructions for the establishing of a yard and the purchasing of utility and decorative plants. You can find the products you need for designing and taking care of a garden. Visiting address: S Group Fleminginkatu 34, FIN-00088 HELSINKI Postal address: P.O. Box 1 FIN-00088 HELSINKI T +358 10 76 8011 www.s-rauta.fi / www.kodinterra.fi Introduction to the main Finnish DIY/ Building Material Chains I July 2017 6
4. Hankkija Hankkija is a store chain specialized in agriculture-related products, machinery, hardware and gardening. It currently has 52 stores and 8 machinery centres around Finland and a John Deere Centre for green-area construction machinery and maintenance in Hyvinkää. Hankkija employs approximately 1000 people in Finland. The net sales in 2015 totalled 819 million euro. The main shareholder of Hankkija is Danish Agro group (60%), with S-Group being a smaller share holder (40%). Hankkija PL 390 (Peltokuumolantie 4) FIN-05801 HYVINKÄÄ www.hankkija.fi Telephone Switchboard: +358 10 76 83000 Mr. Jyrki Lepistö, CEO Jyrki.lepisto@agrimarket.fi T +358 10 76 83084 www.hankkija.fi/Hankkija/Toimipaikat/Toimipaikat/?yid=729 5. Bauhaus Bauhaus, the German do-it-yourself department store was established in Germany in 1960 and it has more than 200 stores in 14 European countries. Bauhaus started operating in Finland in 2001. They currently have 5 stores in Finland. In 2014 Head of Purchases Ms. Susanna Lindberg informed FIT-Helsinki about their procedures. Bauhaus in Finland is an independent company that makes own decisions about the purchases for both Finland and Estonia. What concerns the imports they often use the existing contracts negotiated by the mother company in Germany. These are called Europe Contracts and they are valid in all Bauhaus countries. If a Belgian company already has this contract it will be much easier to establish a channel to Bauhaus in Finland. Bauhaus in Finland wants all their suppliers to have the capacity to deliver their goods to all Bauhaus stores in Finland at supplier’s expense. They do not have a warehouse so all the goods need to be delivered in small quantities to the stores. Valimotie 19 FIN-01510 VANTAA Switchboard +358 9 58411100 T +358 9-58411150 www.bauhaus.fi Introduction to the main Finnish DIY/ Building Material Chains I July 2017 7
6. RTV RTV-Yhtymä Oy is a Finnish independent DIY & home improvement building material store, represented throughout Finland with 26 outlets, catering to both commercial / industrial and private ‘home handyman’ customers. RTV-Yhtymä supplies a wide range of home improvement and building materials, from all major Finnish manufacturers and also imports paints, wallpaper, ceramic tiles, floor coverings, surface treatment machinery, equipment & products and hardware & building products. Mattilantie 1 FIN-11710 Riihimäki T +358 (0) 19 74 21, headquarters www.rtv.fi 7. Hartman Hartman is an independent hardware chain, which has existed for more than 145 years. Their main activity is building & interior decoration. They sell both to individuals as well as professional builders and the industry. The chain is concentrated in Western Finland. Visiting address: Kauppapuistikko 12 FIN-65100 Vaasa Postal address: Hartman Rauta Oy, PL 53 FIN-65101 Vaasa T +358 (0) 6 326 6111 www.hartman.fi Contact details of purchasing managers: www.hartman.fi/sv/kauppapaikat/markkinointi/ Introduction to the main Finnish DIY/ Building Material Chains I July 2017 8
8. Värisilmä / Väritukku Väritukku provides trading sector services for Värisilmä chain. Värisilmä chain has 120 stores in Finland selling paints and home improvement materials both b2b and for private customers. Väritukku is owned by the Värisilmä shopkeepers. Väritukku Oy Postal address: PL 400 FIN-01621, Vantaa Visiting address: Petikontie 20 FIN-01721 Vantaa T +358 9 849 141 www.varisilma.fi varitukku@varisilma.fi Ms. Ulla Pöllänen, CEO ulla.pollanen@varisilma.fi T +358 50 300 1660 9. Puumerkki Puumerkki is a building materials wholesale chain specializing in wood based products and serving building contractors, retailers and industry. Puumerkki serves its customers at 13 locations throughout Finland. The company is also serving in neighbouring areas: Estonia, Latvia and Lithuania. Puumerkki is a subsidiary of Stora Enso Timber and part of the Stora Enso Group. Puumerkki Oy Porvoontie 9 FIN-04220 Kerava T +358 2074 50500 puumerkki@storaenso.com www.puumerkki.fi/en Introduction to the main Finnish DIY/ Building Material Chains I July 2017 9
Mr. Esa Kastinen, Purchases esa.kastinen@storaenso.com T +358 2074 50698 10. Puuilo Puuilo is a family company founded in 1982. The whole company started off from a little carpenter’s workshop. Nowadays Puuilo is a middle-sized chain of stores and does purely retail business. The product selection includes for example: tools, machinery, detergents and different seasonal products. The company is widely known from its affordable prices and extremely wide range of products, which contains over 50.000 different items. Puuilo wants to keep a wide selection and pay less attention to the store interior decoration. In 2015 Puuilo made a turnover of 62 million euro with a 10% business profit. Puuilo also develops own products which are produced in China. 20% of the selection is own import from China. 55% of Puulio’s shares is owned since 2011 by Sentica Partners. Number of staff ~200. Altogether Puuilo has 15 stores in Finland and a webshop. Puuilo Oy Nuaskatu 12, FIN- 87400 Kajaani T +358 2 078 694 40 www.puuilo.fi 11. Byggmax Byggmax is a relatively new chain in the Finland, since 2008. They have more than 100 stores in Scandinavia, of which 68 in Sweden. Byggmax has its headquarters in Sweden. In Finland, they have 13 stores. Byggman works with a ‘drive-in concept’ where customers collect the products from the warehouse shelves. This lowers the prices. www.byggmax.fi Headquarters, Sweden: Box 6063 SE-171 06 SOLNA T +46 8 514 930 Introduction to the main Finnish DIY/ Building Material Chains I July 2017 10
12. Motonet Motonet was founded in Turku, Finland in 1990. Motonet is specialized in car spare parts but they also have a wide selection of DIY products, as well as all kinds of hand and power tools, boat accessories, fishing equipment, gardening, cycling, motorcycling. The company has a total of 27 stores in Finland. The turnover in 2016 was about € 269 million. Motonet Oy Postal address: PL 131 FIN-20251 TURKU T +358 40 3190 190 www.motonet.fi For suppliers: www.motonet.fi/fi/tavarantoimittajille?lang=en 13. Netrauta Finland Netrauta is a DIY webshop. They work together with suppliers. They have many products from Central Europe and are familiar with Belgian products. Netrauta Finland Oy Address: Ideaparkinkatu 4 FIN-37570 LEMPÄÄLÄ T +358 29 1800 220 www.netrauta.fi/ 14. Taloon.com Taloon.com is a DIY webshop and is part of Swedish Bygghem. Their turnover in 2016 was € 20 million whereas in 2009 it was only € 1,8 million. They have over 100,000 products in their selection. Taloon Yhtiöt O www.taloon.com Introduction to the main Finnish DIY/ Building Material Chains I July 2017 11
DIY sector in Finland: sales 2014-2016 A few translations: • Ryhmittymä / ketju = group / chain • Myymälät kpl = number of stores • Myynti milj. € = sales million euro • Kehitys = development • Yhteensä = total • Muut ketjut = Other stores • Muut sisustuskaupat = Other interior decoration stores Introduction to the main Finnish DIY/ Building Material Chains I July 2017 12
Disclaimer The information in this publication is provided for background information that should enable you to get a picture of the subject treated in this document. It is collected with the greatest care on the bases of all data and documentation available at the moment of publication. Thus this publication was never intended to be the perfect and correct answer to your specific situation. Consequently it can never be considered a legal, financial or other specialized advice. Flanders Investment and Trade (FIT) accepts no liability for any errors, omissions or incompleteness’s, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organization mentioned. Date of publication: August 2017 Introduction to the main Finnish DIY/ Building Material Chains I July 2017 13
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