One year after opening on the Romanian market, Cycleband, an Italian children’s clothing retailer has decided to close its local franchises, announce representatives of the Romanian franchise.
Citing poor sales results and “lack of support from the brand’s owner, who did not understand the Romanian market”, the press release announced Cycleband decided on forced closure of all five franchises in Romania.
After a private investment of over EUR 300,000 in the opening of the five stores, the local company who operated the Cycleband franchise posted a turnover of RON 850,000 (EUR 192,290) in 2014 and an accounting loss of RON 766,000 (EUR 173,290). The forced closure will bring more loss from penalties arising from early closure of leases (concluded for a period of 5 years).
The Romanian company opened proceedings for insolvency and a commercial trial against the Italian company for breach of contract, in an attempt to recover losses and damages.
The Romanian Cycleband stores were open in Bucharest Mall, Promenada Mall, Orhideea Shopping Centre, Ploiesti Shopping City and Atrium Arad.