Croatia
Market Overview
Bord Bia, Frankfurt
November 27th 2008
Market Overview
•
Population: 4.46 million (IGD, 2007)
•
Main cities are Zagreb, capital (779,200),
Split (463,700), Osijek (330,500) and Rijeka
(305,500)
•
Languages: Croatian (Official)
•
Expected to join the EU in 2010.
•
Currency: Croatian Kuna
– €1 = 7.14 HRK (ECB, October 2008)
Source: IGD, 2007
Market Overview
•
Real GDP Growth rate: 4.5% 2008(e)
– Stable growth rate in recent years (IGD, 2007)
•
Inflation rate: 2.6% (2007) (IGD, 2007)
•
Unemployment: 11.2% (2008 (e)) but falling (IGD, 2007)
•
Consumer Spend per capita has been increasing in recent years.
€4,013 (2005) to €4,568 (2007), (IGD, 2007).
•
Population:
» 16.2%
» 67%
» 16.8%
0-14 years
15-64 years
65+ years (IGD, 2007)
Economy
•
VAT: 22%
•
Global Exports: $10.376 billion (2006) (WTO, 2008)
•
Imports: €21.5 billion (2006) (WTO, 2008)
•
Import breakdown:
– Manufactures
– Fuels and mining products
– Agricultural products
72%
18.5%
9.4%
(WTO, 2008)
•
Main export partners: EU 27 64.2%, Bosnia and Herzegovina 12.6%
and Serbia 5.2% (WTO, 2008)
•
Main Import Markets: EU 27 67.2%, Russia 10.1% and China 5.3%.
(WTO, 2008)
Irish Food Export Performance
Irish Food Exports
Total Value of
Exports
€2 million
to Croatia 2007
Miscellaneous
edible
49.4%
Sugars
2.8%
Vegetables and
Fruit
14.7%
Source: CSO Food and Drink Statistics 2007
Beverages
22.0%
Fish
10.4%
Dairy
0.7%
Key Consumer Trends
in the Market
•
Retail Sector is showing solid growth.
•
Consumer behaviour in Croatia is similar to Western Europe, but
purchasing power is low.
•
Grocery sales account for approximately 51% of the Total Retail Market
(IGD, 2007)
2006
(€)
2007
(€)
2008 (e)
(€)
Total Retail Market (billions)
8.59
9.5
10.17
Grocery Retail Market (billions)
4.57
4.88
5.18
Grocery Retail Spend/Capita
1,018
1,086
1,146
Source: IGD, Retail Analysis, Country Profile Croatia, 2007
Retail Grocery Market
•
Market value: €5.18 billion (2008 (e))
– No.11 in the Top 10 Eastern European Markets in terms of turnover. No. 72
in the Top Global Markets (IGD,2007)
•
Increasing per capita spend €1,086 (2007): €1,146 (2008(e)) (IGD, 2007)
•
Supermarkets are leading format - accounts for 43% of value of grocery retail,
closely followed by small grocery stores at 37%.
•
Discount Retailing is growing: 2% in 2002 v 6% in 2007 (IGD, 2007)
– Lidl (Lidl & Schwarz Group) €5 million sales (2006) (IGD, 2007)
•
Konzum is Croatia's top retailer operating convenience stores, cash and carry’s
as well as supermarkets. They account for a 37.3% market share, excluding
their cash and carry sales under the name Velpro (IGD, 2007).
Retail Grocery Market
•
Cash & Carry: Market is stagnant after a period of growth.
– Getro accounts for sales of €355 million in 2006 and is Croatia’s
largest cash and carry chain.
– Velpro (part of Konzum) had sales in the region of €221 million in
2006.
– German Metro Group had sales of €270 million (IGD, 2007)
•
Konzum was renamed from Unikonzum after the fall of communism. It is
a major player in the Croatian market accounting for over a third of sales.
They aim to consolidate their position through a strong store opening
programme and selective acquisitions (IGD, 2007)
Source: IGD, Retail Analysis, Country Profile Croatia, 2007
Retail Grocery Market
•
The Croatian retail market is very fragmented and is dominated by local
players. The strict trading laws discouraged foreign retailers from
entering but this is changing.
•
Croatia has a number of smaller retailers joining together to form
buying groups.
– Eg Ultra Gros: made up of 20 small Croatian retailers and operates
over 450 stores.
– Eg CBA: made up of 8 trading companies operating some 540
supermarkets.
•
Consumers are becoming more sophisticated which places more
pressure on local retailers, but allows for opportunity for margin
improvements.
Source: IGD 2007 Country Presentation on Croatia
Retail Market Share 2006
Other
20%
Ultra Gros
8%
Konzum
38%
Getro
6%
Metro
6%
CBA
3%
Kerum
3%
KTC
4%
Source: IGD Country Presentations Croatia 2007
Mercator
4%
Lidl &
Schwarz
4%
Rewe
4%
Retail Market Structure
Top 10 (2006)
Retailer
Total
Sales
(€m)
Grocery
Sales
(€m)
% Change
Grocery Sales
2006 v 2005
Grocery
Retail Market
Share (%)
No. of
Stores
Sales Area
(sqm)
Konzum
1,935
1,925
+15.2%
37.3%
578
270,000
Ultra Gros
444
444
+8.2%
8.12%
450
135,000
Getro
290
290
+2.1%
6.3%
19
93,800
Metro
270
270
+20.5%
5.9%
6
47,000
Rewe
215
215
+9.8%
3.93%
50
160,000
Lidl & Schwarz
245
245
+9.1%
4.48%
30
87,500
Mercator
262
198
+37.2%
3.62%
69
69,188
CBA
180
180
+9.1%
3.29%
540
162,000
KTC
194
194
+3.2%
3.55%
16
48,000
Kerum
190
190
+2.7%
3.47%
55
16,500
Source: IGD Analysis, Country Presentation, Croatia 2007
Private Label
20
Private Label Share 2006 %
% Private Label
19.2
(14.4)
12.5
(8.0)
10
9.6
(9.6)
7.0
(2.4)
6.6
(5.5)
4.0
(2.7)
6.4
(-)
0.2
(0.2)
0
ro
et
G
Ko
um
nz
R
ew
e
dl
Li
ro
et
M
e
in
d
o
Pl
Source: IGD Analysis Country Presentation, Croatia 2007
P
so
re
fle
x
C
KT
Foodservice Trends
•
•
•
•
Chain restaurants with the exception of fast food chains are not really
present in the Croatian market. Most predominately found are small
traditional restaurants that have increased the quality of their food and
service.
Ethnic restaurants have expanded considerably in recent years
especially Italian, Chinese and Mexican restaurants.
The foodservice market is extremely fragmented with mainly
independents operating in the market and certainly making up the bulk
of the foodservice market.
Growing foreign tourism and a growing economy is likely to affect the
foodservice market in the coming years.
Foodservice
Establishments
•
•
•
McDonald’s
– Entered the market in 1996 and currently operate 16 outlets
– Approximately 20,000 patrons visit their outlets daily and in 2002
the turnover was $15.4million.
Subway
– Operates 4 outlets in Croatia.
– Turnover is not released
Pizzeria’s
– There is no shortage of pizzeria’s in Croatia,
although there seems to be very few chains.
Source: McDonalds‘ Subway and the USDA
Reasons for targeting Croatia
•
•
•
Retail market is forecast to grow by 63% from 2005-2015 (+€6.7bn)
according to IGD
Consumer Spend per capita has been increasing in recent years. €4,013
(2005) to €4,568 (2007) (IGD, 2007).
Well developed and modern infrastructure
Barriers/challenges in supplying
Croatian market
•
•
•
•
Small population (4m)
Not in the EU
Local Language barrier
Distance to market adds to logistical challenge
Bord Bia services 2009
•
Bord Bia market mentor (Mr. Kieran Fahy) available for Eastern Europe market and
trade related queries:
•
Services include: Itinerary Development, Category Analysis, Media review and
translation services, Product Price auditing and tracking, Product retrieval, Buyer
networking, Distributor searches
Kieran Fahy
Sarospatak ut 32
1125 Budapest
Hungary
Tel: +36 706 144871
Email: Kieran.fahy@freemail.hu
Also: Liam MacHale
Bord Bia
Wöhler Str. 3-5
60323 Frankfurt, Germany
Tel +49 69 710 423 255
Email: liam.machale@bordbia.ie