K-rauta's parent company, Kesko Senukai, which sells construction, renovation, home and electronics goods, announced this week that it plans a major expansion in Estonia, Latvia and Lithuania. The company is currently searching for suitable plots and premises for retail operations. They are considering a range of property sizes — from 5,000 square meters in smaller towns to as much as 25,000 square meters in larger cities.

Kesko Senukai Estonia's managing director, Viktorija Voicenko, told ERR that despite ongoing challenges, the construction sector is showing signs of recovery.

"The revival of international projects and export potential allows us to expect a more active period and new opportunities in the near future," Voicenko said.

Decora, which operates seven stores and an online shop, noted a general decline in consumer purchasing power last year, which caused its revenue to fall by nearly 2 percent to €76.37 million. The company posted a profit of €336,000.

Decora Managing Director Eike Tubli-Müür said she believes there is no free space left on the Estonian market for new construction stores.

"I don't know where this optimism is coming from," she said, commenting on the competitor's expansion plans, and speculated that K-rauta might be aiming to broaden its product range, perhaps by focusing more on household appliances.

Tubli-Müür added that, just like in the grocery sector, customers in construction stores are primarily drawn to discounted and promotional items. She said there's still no indication that buyers' purchasing power is recovering and there's no reason yet to be optimistic.

Kesko Senukai Estonia's revenue last year was around €115.3 million, about 5 percent less than in 2023. The company posted a profit of €891,000.

Voicenko noted that K-rauta holds a strong leading position in the market and, with support from the Kesko Senukai Group, is well-positioned to strengthen it further. That, she said, is why they are investing in expansion.

The first step in K-rauta's expansion will be a new store opening in Tartu, which is already under construction. Until now, K-rauta has operated eight stores and several online shops in Estonia.

Bauhof considers the construction sector stable

Bauhof Group, owned by a Lithuanian parent company and operating 13 stores and an online shop in Estonia, saw its revenue fall by 3 percent last year compared to the year before, totaling €113.3 million. Bauhof also considers competition in the retail construction and gardening goods sector to be intense.

Kristina Käit-Kattel, Bauhof Group's marketing director, said the company cannot comment on competitors' plans, but that the construction sector remains stable.

"While there hasn't been significant growth compared to last year, we continue to see steady interest in home improvement and small-scale renovation projects," she added. According to Käit-Kattel, Bauhof is constantly working on its product assortment to meet customer expectations, which has helped the company grow its market share.

Still, Bauhof ended both last year and the year before in the red. Last year's loss was €1.34 million, compared to a €724,000 loss in 2023.

Bauhaus Eesti OÜ, which operates two physical stores and an online shop, also saw a decline in revenue, dropping to €32.8 million last year from €36.4 million in 2023. Its profits, which stood at €1.1 million in 2023, turned into a loss of more than €450,000 last year.

"The Estonian economy has been in decline. Rising interest rates and prices have curbed consumer spending, which has in turn reduced sales revenue," the company noted in its annual report published this summer.

Despite this, Bauhaus viewed its outlook for 2025 as moderately positive and stated that it has a long-term strategy in place for operating in Estonia.

In contrast to its competitors, Depo has consistently grown its revenue year over year. Last year it reached €56.7 million, up from €52.5 million in 2023 and €47.2 million in 2022.

Depo posted a profit of €415,000 in 2022, €1.58 million in 2023, and €1.56 million last year.

The Latvian Depo chain currently operates just one store in Estonia, located in Tallinn.

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