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Offertissima: The Perfect Target for Venture Capital Funds

<p>Offertissima Zagreb</p>
Offertissima Zagreb / Image by: foto Ratko Mavar

At the beginning of this summer, a store of Offertissima was opened in Poreč, the third in Istria after Pazin and Labin, out of a total of about seventy sales locations of this retail chain, but only the second in a city along the Adriatic coast. Offertissima made its first step into the Adriatic a few years ago in Šibenik, and all other smaller and larger tourist centers along the coast still represent a huge development potential for the company based in Sveti Nedelja.

This year, Offertissima marks thirty years since its establishment. It was founded by Danijela Cigić and Draženko Rozić, who have equal ownership shares and are still its co-owners today. From its founding until a month ago, Cigić was the only director of Offertissima, and now it is Rozić. The two are also co-owners of Offertissima Real Estate, which manages Offertissima’s properties and generates around one million euros in revenue annually.

There are several non-specialized types of stores for which it is difficult to define their sales assortment in a few words. For example, retail chains like Pevex and Bauhaus have the description ‘everything for the home and construction’, although this description only partially covers their offerings. When it comes to Offertissima, no description has become established, primarily due to the diversity of the assortment that has long made Offertissima unique in Croatia. Meanwhile, the German chain TEDi has entered our market, which is the most similar to Offertissima in terms of its product structure. Part of Offertissima’s offering overlaps with that of KIK and Pepco, but they are not entirely comparable as those two chains generate most of their revenue from clothing sales, which is not represented in Offertissima.

The phrase ‘from a needle to a locomotive’ is also not suitable for describing Offertissima. A slightly more accurate description would be ‘from a needle to a large garbage can’, and perhaps the most accurate would be ‘what is sold in Chinese stores’, but with the note that all of this is a bit more refined, tailored to the habits and needs of the domestic consumer, and sourced from suppliers from a larger number of countries, including Croatia! In addition to sourcing goods from China, Vietnam, India, Turkey, Ukraine, Serbia, Bosnia and Herzegovina, Italy, Spain, Portugal, the United Kingdom, Slovenia, Bulgaria, Poland… Offertissima has products from about eighty domestic manufacturers, mostly smaller companies and craftsmen. Some of these products are immediately noticeable due to the label ‘Croatian product’, such as the school black marker brand Optima, produced by Eurocom from Donji Stupnik. The price of this marker in a 20 ml package at Offertissima is 0.90 euros, which is about ten percent lower than the same item in other stores. However, we found a store (data known to the editorial office) where the same marker in the same package is sold for 4.72 euros.

Last year, Offertissima reached 38 million euros in revenue, which is an increase of just under 11 percent compared to 2022. A growth of about ten percent in revenue per year has been almost standard for this company in recent years. An exception was the year 2021, when revenue jumped nearly 20 percent, after falling the year before, in the pandemic year of 2020. However, that decline was less than six percent, which is also less than the declines experienced by its competition that year.

The most successful year in terms of profit for Offertissima was 2019 when net profit amounted to more than 2.6 million euros. Four years later, with revenue eight million higher than in 2019, Offertissima achieved a net profit of 2.1 million euros, which the owners decided to retain in retained earnings, as they have every previous year. Just in case!

At the end of the past five business years, Offertissima recorded – zero in the ‘long-term liabilities’ position on its balance sheet.

In other words, it has successfully managed both operational and investment financing for years without a single euro borrowed from the financial market. It holds a credit rating of A1, owes nothing to anyone, and is not at risk of potential non-collection. Therefore, Offertissima is a perfect target for acquisition. It is also not disputed whether there are interested buyers for it. There are – venture capital funds love such healthy companies that still have significant room for growth. The question is only whether Danijela Cigić and Draženko Rozić will succumb to offers or whether, after thirty years, they still have enough passion to continue this business.

Read the entire corporate story of Offertissima in the new issue of the printed and digital Lider.

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