Habitat shuts down despite boom in furniture market

Habitat, the premium furniture store in Nicosia that is part of the Greek-operated franchise, has closed down despite overall retail sales of furniture doing very well, according to recent government statistics.

A sign in the store window in Nicosia says it is closed “until further notice”.

Customers expecting a delivery before Christmas have found that no one is answering the phone in Nicosia, following the overnight closure of the three Habitat stores in Greece a week ago due to financial losses. The company, French Home Appliance Imports SA, operated by Constandinos Zaranis, filed for bankruptcy last Monday and laid off 100 employees.

Established in Greece eight years ago, Habitat’s main competition came from IKEA, the low-end furniture store that opened two outlets – Thessaloniki and Athens – and plans to open its first store in Nicosia next year. Ironically, both stores belong to the same holding company, Inka Holdings.

The company first showed signs of difficulty in 2004 with the arrival in Greece of multinational furniture and home appliance stores, according to Naftemboriki.

Sales dropped from EUR 14,44 mln in 2004 to EUR 12,85 mln in 2005 with accumulated losses of EUR 2 mln with debts rising to EUR 9,4 mln (from EUR 8,5 mln in 2004).

News reports added that customers who had placed orders in Greece have lost their deposits.