Sixteen years later, the curtain was in danger of falling in favor of Big Bazar, the chain of deals with which the Blokker family wanted to take a stand against popular and fast-growing competitor Action.
In addition to the department store chain of the same name, the Blocker family ran a series of other chains for decades, such as Entertoys, Lane Packer, and Marskramer’s. At that time, Blokker Holding was considered one of the most powerful companies on the Dutch shopping street.
But after the turn of the century, Blokker Holding’s home appliance stores in particular began to suffer significantly from rival retailer Action. This chain of deals has grown steadily after opening its first store in Enkhuizen in 1993. In 2003, Action had one hundred stores in the Netherlands, and in 2008 it already had two hundred locations.
Counterattack: Grand Bazaar
That is why the Blocker family decided to launch a counterattack in 2007. At the end of 2007 they opened the first Big Bazaar branch in Apeldoorn. Like Action, this new store format focused on inexpensive products. This design is still reflected today in the slogan: “So much, so strangely cheap.”
The practical competitor grew rapidly under the wings of the then still powerful parent group. In 2016, Big Bazaar had 123 branches and 1,650 employees.
However, in the meantime, the shine has completely faded at parent group Blokker Holding. In 2014, the retail giant posted a loss for the first time in its history. These losses mounted with astonishing speed.
Initially, the group recorded several tens of millions of losses annually. In 2016, the loss amounted to 180 million euros. Blokker Holding ended 2017 with a staggering loss of $344 million.
During those years, another reorganization followed in the Blokker Group, during which countless stores were closed and thousands of employees lost their jobs. In May 2017, the Blokker family reversed its decision and announced that it would divest almost all of its retail chains, except for Blokker itself.
Benefits of Grand Bazaar
Interestingly, Big Bazar was initially able to take advantage of the crisis within the Blokker group. In 2017, 30 new stores were opened in Big Bazar. Some of this included reopening in a larger location. A large number of new large bazaars found shelter in the closed branches of Blokker and Marskramer stores.
“Big Bazar is therefore one of the fastest growing retail chains in the Netherlands,” Blokker Holding exclaimed in its 2017 annual report. At the end of the year in which Big Bazar celebrated its 10th anniversary, the chain had 133 stores, 11 of which were in Belgium.
But the annual report did not say whether the fast-growing chain of deals was also a financial success. Blokker Holding has never published results for individual retail chains.
In the spring of 2019, a new phase began for Blokker Holding, when retail entrepreneur Michel Wittveen took over the management of the group from the founding family. Blokker Holding has now been significantly downsized and offloaded, but the Blokker and Big Bazar retail chains still exist.
Witteveen has renamed Blokker Holding Mirage Retail Group and said it wants to take the company public. In the run-up to the IPO, he expanded the seriously divested group by buying back toy chain Intertoys and acquiring white goods chain BCC.
Under Witteveen, Big Bazaar’s ambitions also remained high. For example, in 2019, the company announced that it would convert fifty branches of the bankrupt drugstore Op = Op Voordeelshop into Big Bazar. The deal chain will grow to 170 branches.
Corona and unrest
However, those plans were rudely disrupted in early 2020 due to the outbreak of the Corona pandemic. During the Corona years, non-essential stores like Big Bazar have had to keep their doors closed for long periods.
The interim annual account for 2021 from Big Bazar Holding, which has not been approved by an external accountant, shows that the chain of deals incurred significant losses in those years.
In 2020, Big Bazaar recorded sales of €106 million and a loss of €14.5 million. In 2021, sales value decreased by 27 percent to 77.4 million euros. Ultimately there was another loss of over €14 million that year.
And big losses don’t seem to be limited to recent years, judging by the evolution of shareholder equity. The item “other reserves” stands at negative €145m at the end of 2021. This indicates that Big Bazar has recorded a total loss of around €160m in its 14 years of existence – including the red figures that have yet to be addressed for 2021.
“Big Bazar has never been a truly winning retail formula. And that formula has never had an identity or a marketing strategy,” the company admits in the annual report. According to the report, Big Bazaar’s losses were covered for years by its parent company.
Trade show plans
The continuing large losses of its subsidiary Big Bazar have seriously upset the new owner of the former Blokker Holding, Michiel Witteveen. These losses could seriously disrupt his plans for the Mirage Retail Group IPO. At the end of 2021, Witteveen announced that it would liquidate the series of distressed deals.
Power Buyers weren’t really pushing. But Frisian businessman Herk Koestra offered a way out. This mysterious Frisian stock trader wanted to take over the chain, which at the time had 135 stores and 1,750 employees, for an unknown sum.
“Happy with Herky”
Witteveen stated in the media that Big Bazar was not a good fit for Mirage, as it does not have an online store. Under Questra’s wing, the company will have much better opportunities. Big Bazar also wrote in a letter to suppliers that RTL Z was in good hands with the new owner.
“Kooistra is a well-known name in the Dutch discount market and has made a name for itself over the past 20 years as a stock trader, buyer and operator of outlet stores in the North of the Netherlands,” company director Hans Danhoff reassured the company’s employees. relationships at that time.
“We are thrilled with Heerke’s arrival. It gives us access to new partnerships and purchasing channels that help us expand the uniqueness of the formula.”
The new owner said he stepped in last year to make Big Bazaar healthy again. In the aforementioned annual accounts, Cuestra writes that he closed underperforming subsidiaries, appointed more aggressive management, introduced a new IT system and cut costs.
But he also acknowledges that results in 2022 were “well below expectations.” Since external financing is needed to improve business results, Big Bazaar will negotiate with investors.
After the Blokker family and Michel Witveen, Kooistra also failed to put Big Bazar on the right track. in profile account The Frisian businessman was described in Financieele Dagblad newspaper on Thursday as a born trader, but nonetheless less suited to leading a large company.
This will be the case with wholesale northWhich went bankrupt at the beginning of this year, perhaps it was an administrative chaos. In addition, the wholesaler is said to have accumulated a large tax debt. It is also said that Big Bazar is owed money from the North.
An analysis by a consulting firm hired by the deal chain shows how poor Big Bazar’s results have been under Kooistra’s leadership over the past year and a half. The department store chain would have incurred a loss of more than 17 million euros in 2022. In the first half of 2023, the loss was estimated at more than 5 million euros.
Continuous losses cannot remain without consequences. The first alarming reports about Big Bazaar emerged in mid-July, about rent arrears, non-payment of suppliers and lenders, half-empty store shelves, and delayed salary payments. The first bankruptcy filings soon followed.
On August 28, Big Bazaar apologized to creditors in a full-page ad in FD titled “Big Apologies,” and promised to do better. In the Leeuwarden court, the company itself and later the works council are trying to get some breathing room to find a solution to the problems.
The company’s request was rejected at the beginning of this week, while the court heard the Labor Council’s subsequent request yesterday. Sentencing will follow next week. Big Bazar has already indicated that it fears bankruptcy if it is not given additional time to find additional financing.
Why was Big Bazar never a success?
With Big Bazar, Blokker Holding wanted to take a stand against the rise of the popular bargain chain. The chain of stores grew rapidly, but incurred huge losses. Why couldn’t Big Bazar reproduce Action’s success?
According to Eef Luchies of Brand Junkies, which develops retail formats, Big Bazar lacks differentiation. “For cleaning products or things to decorate your home, go for the action, you can be sure you will succeed there.”
According to Luchies, Action stores are also better and more visible, so customers can find what they’re looking for more quickly. “Big Bazar branches are very confusing, also because of the advertisements in the stores themselves.”
Kitty Kollemeyer, professor of marketing and retail at Nyenrode Business University, points out that rival Action has a huge competitive advantage with 400 stores in the Netherlands and another 2,000 in the rest of Europe. “The business has much more purchasing power, larger stores and a more diverse range.”
Retail expert Paul Moyers adds: “If you’re a copy of Action, you have to do at least one or two things better. But that hasn’t happened at all.” Big Bazar stores are “fairly poorly managed,” Moyers says. “It’s chaotic and not attractive enough in scope.”
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