Staff Writer, The Prague Post
Anthony Denny is the used car king of Central Europe, with his company, AAA Auto, holding a large share of the domestic market and pushing into neighboring countries. In late September, AAA became the first company this year to launch an initial public offering on the Prague Stock Exchange, offering a minority share of its stock. Denny talks to The Prague Post about AAA s formula, its expansion east and the itch cycle.
What prompted AAA s rapid expansion over the past few years? We realized we had a formula that was working well and that we were in an ideal situation to capitalize on it. Everywhere we ve opened sites in the Czech Republic, we re selling lots of cars with low cannibalization from other sites. So we decided to put it into top gear. This year we opened 22 sites, which stretched our internal resources to the absolute limit. We ll never do that again. Next year we ll open 12 to 14 sites.
We had a great resource of middle to upper managers in the group for several years, so we were able to open those sites, but now we have to train new managers. And you needed the IPO to fund this? The IPO gives the company transparency in a controversial industry, which will enhance our credibility with financial partners, customers and the press. And, more importantly, it does give us capital for our expansion. We re looking at Moscow and St.
Petersburg, which are the only two cities in Russia that you only need to be in for the next five years. We re looking at land in northern Moscow right now and also talking with dealership groups about a potential joint venture. We have similar situations in Ukraine, Kazakhstan and the Balkans. Also, looking at the current markets we re in, we still have room to expand. We have a 23 percent market share in the Czech Republic and that can grow to possibly 30 percent in the next three years.