Baumax's Expansion into the Emerging Markets of Central and Eastern Europe

This short teaching case focuses on an internationalisation decision of bauMax in the year 2005. bauMax had been a relatively successful Austrian family-owned retailer in the do-it-yourself (DIY) segment. After a successful expansion into neighbouring countries in Central and Eastern Europe (CEE) in the early 1990s, growth and profitability in the home market and in a number of host-markets became increasingly disappointing. The owners (and managers) saw further international expansion as the key to bring back growth and profitability. Romania was identified as one of the target markets. The case explains bauMax’ business and strategy and presents data on the Romanian market situation. The discussion focuses not only on the Romanian decision but also on the more general logic behind bauMax’ internationalisation