Petr Bena (Alza.cz): In 2030 we will be the second or first largest company in the Czech Republic

Petr Bena

He was appointed Vice-Chairman of Alza.cz in June 2020. Prior to that, he headed the Sales and Purchasing Department. He previously worked for Procter & Gamble, where he was Sales Director for nine Central European countries for seven years. He graduated from the University of Economics in Prague.

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Christmas is approaching, have you taken any steps to reduce delivery times and optimize the entire logistics process?

We have expanded our logistics centers, with 40% more usable space year-on-year. We have recently opened a warehouse in Chrášťany, we have expanded our warehouses in Senec or Úžice. We need more capacity due to the need to stock up more supplies. Today, there is a supply crisis in the market and it is crucial to ensure the availability of goods for customers. Of course, big investments go into AlzaBoxes, we want to have two thousand of them by the end of the year. And boxes mean faster delivery. All orders in the Czech Republic that are made by seven o’clock in the evening will be delivered the next day at eight in the morning. That is, with the exception of Aš, where we are chasing it on the tenth. We even load Prague boxes several times a day.

Outside the Czechia, for example, we are opening our first city warehouse, in Budapest. We usually have warehouses in the vicinity of large cities. In this case, we will have a small warehouse directly in Budapest and we will be able to deliver very quickly. Sometimes I read somewhere that the speed of next day delivery is enough. No, it’s not enough. We see that reduced delivery has a tremendous impact on conversion from the web.

You mentioned the supply crisis. How do you deal with that? Are you trying to stock as much as possible and as soon as possible, or do you have any other levers?

Of course we try to buy what we can, so we have increased stocks. The advantage is that companies that are financially sound are significantly better off today than companies that have been operating around zero or at a loss for a long time. It is significantly more difficult for them. We are now able to take part of the cash flow from the profit and invest it back in the business, so that we can buy goods, even if it means that we have a longer inventory turnover. Rise has some reputation, some track record, we pay invoices on time. These are the things that help us. We are trying to drive more and more things on our own, for example within our private labels, which are extremely successful.

On the other hand, many products are simply not available. Not to mention the Playstation 5 console. Although we still have a lot of pre-orders, these goods are simply not available. Likewise, when laptop manufacturers get some chips or processors, they put them in more expensive laptops and the cheaper ones on the market are missing. Then things like bitcoin come in, whether they’re mined, they’re not mined, they’re or aren’t graphics cards, etc. There are so many variables and things that covid has decided.

You have also launched a marketplace where you offer third-party goods. How would you rate it so far?

Very positive. Along with the opening of AlzaBoxes to other e-shops, the marketplace is part of Alza’s platforming, where we lend our capacities to other entities. And it is also beneficial for our partners. According to previous experience, their presence in our marketplace increases their turnover by 20 or 30%. It is another sales channel for them. We are now trying to automate the entire onboarding as much as possible so that they have a so-called click.

But our customers are used to a certain standard in terms of quality, content, labels. We do not want to back down from this, so this is the area we are working on. We closely monitor whether the products are of good quality, whether they have a four- or five-star rating. We also oversee product complaints in order to maintain the quality of the catalog as such.

We talked about the speed of delivery, do the marketplace traders manage to keep up with Alza in this regard?

They are slower, the standard is D + 1, the same day within the marketplace is not. However, they can deliver to our branches and we work very hard to get into our AlzaBoxes. And the vast majority of our partners use our preferred carrier, only a few of them handle the transport themselves.

How are your sales in the B2B segment developing so far?

This segment is crucial for us. It does about 30 percent of our business. Since August, we have a dedicated director at B2B or, as we say, Alza for companies, and we see great potential there. Whether it is SMB, ie small businesses, or large companies, government, education.

Does Alza still have a place to grow in the Czech Republic?

We think that Alza can be four to five times larger in the Czech Republic alone until 2030 than it is today. Whether it’s a growing share in our traditional categories, that is, IT, electronics, or in the segments that came to Alza later, toys, sports, hobbies, etc. There are also areas that we hardly sell at all or not, such as furniture or clothing. So we think that in the Czech Republic the opportunity is still great. Of course, it is even larger abroad.

City logistics center in Budapest

If we focus on your foreign expansion, how are you doing abroad so far?

I’d say great, but of course it can be even better. In Hungary, we are number two on the market after five years and we certainly have ambitions to become number one. But that will probably take us a while. All the investments we make in the Czech Republic are made in Hungary. In addition, I mentioned our first city logistics center, which we will not have in Prague or Brno, but in Budapest. Of course, we also open AlzaBoxes in Hungary.

As for Germany, it is our most dynamic market and we trust it extremely much. Last year we grew there in the hundreds of percent, which surprised us a little. We’ve been in Germany for a long time, but we haven’t focused so much on it. This year, however, we focus a lot on Germany, we even started to drive not only D + 1 to Berlin, but if you order by 6 pm, we deliver the next day between 9 am and 1 pm.

We want to start serving more large German cities in this way, and I think we will open a warehouse or warehouses there next year to get closer to our customers and give them a better service than they are used to. In Germany, we also received the award from the largest IT magazine Computer Bild “Trend Shop 2021”, which is given to fast-growing e-shops that meet quality criteria.

Are you going to another country?

We should start France later this year. And we’ll see. We like big countries
and we would rather go west than east, even though there is a more developed market in the West with more demanding customers. Maybe there is more competition. But on the other hand, when we look at what quality Alza offers in the Czech Republic and how many goods we are able to deliver to customers on the day of the order, how we are developed in speed of delivery, we think we have something to offer a Western European customer.

In Germany or France, delivery standard is D + 2 or D + 3. Of course, these are geographically larger countries, which means that we have to configure Alza a little differently there, one or two warehouses are not enough. But we have it already figured out and we are starting to do it.

You mentioned Vision 2030. So what will Alza be like in nine years?