The course of Greek electrical equipment and lighting solutions company Kafkas over the years of the country’s financial crisis is an exception worth analyzing.
While the Greek economy shrank by 25 percent in 2008-16 and the electrical equipment market associated with construction activity saw business contract 60 percent, Kafkas not only managed to survive but also doubled its sales with steadily high profits.
At end-2017 its turnover will exceed 130 million euros, against 68 million in 2008, while pretax profits will top 6 million euros. It now controls 38 percent of the market, compared to just 9 percent before the crisis broke out, being the industry leader by some distance.
Founded by electrician Vassilis Kafkas in 1975, his son, Nikos, expanded the firm from three stores in 2000 to 10 in 2003, making it the Greek market leader in 2004.
“From 2006 we knew that the carefree growth period would end and that the construction boom would prove unsustainable, and we started shielding ourselves – though we never suspected the intensity and duration of the crisis,” Nikos Kafkas told Kathimerini.
One key factor “was the decision to go out to the customer instead of waiting for them to come to the store. We turned to technology services, to the energy upgrading, security and management of buildings, and to new products and markets such as industry, shipping, special lighting, photovoltaics and smart homes. That way we broadened our activity during a period of great recession [which had an] even greater [impact on] the market we were active in,” said Kafkas.
In 2006 the wholesale and retail company moved into the sector of studying and assembling medium- and high-voltage switchboards, and in 2008 it modernized and strengthened its infrastructure, as well as installing extensive online systems.
The crisis offered the firm an opportunity to hire more than 300 specialized scientists, which has taken Kafkas’s staff from 341 in 2008 to 825 today. Now it caters to 8,000 customers on average on a daily basis through its 56 stores, which offer 180,000 products.
After investing 29.1 million since 2008, which included establishing the Kafkas Institute of Training & Development in 2012, Kafkas plans to invest 10 million euros in the next three years, and will expand to Cyprus in 2018.