Why are Slovaks shunning their own supermarket goods?

16-08-2003

A campaign is currently underway in Slovakia calling for consumers to buy homemade products, rather than imported goods. It aims to boost the Slovak domestic economy. But a recent poll has shown that a vast majority of Slovaks don't care about the country origin or the quality of products. What they do care about is the price. And Slovakian products tend to be much more expensive than goods imported from the EU.

In one of Bratislava's major stores, I went to a shelf with milk products. I picked up a pudding made in eastern Slovakia and I saw it was a little bit more expensive than the one next to it made in Germany. So I wondered why should people change their minds and buy a Slovak product instead of an imported one if it is more expensive? Igor Vzos from a Slovak milk firm tries to explain...

"Most of our milk products are either the same price as the foreign ones or cheaper. However, there are products where the price is significantly higher. A good example is our puddings. They are much more expensive than the German ones but its only because the Slovak pudding is a better quality, it has no pesticides and artificial elements added to it."

In many cases imported goods are supported by subsidies from the governments, they are produced in bigger quantities so the margins are much lower than the Slovak products have. And the final price in a store is mostly influenced by distributors. Analyst Barto continues.

"The price is partially influenced by producers, but also by distributors. And the pressure on Slovak producers is increasing now with the entrance of large retailed - chains..."

Which make the prices calculations different to every Slovak producer. Igor Vzos again...

"We have a different contract with every other retail-chain store. In general, the prices we sell our products for to big distributors are not too much different compared to the final prices in individual stores."

Competition is still increasing and it will continue even more after Slovakia enters the EU next year. Nowadays price level in our country is much lower than in the EU. According to Martin Barto, it is now at about 40% of the EU average. What will change when we enter the union?

" There will be a pressure on the Slovak producers, but I do believe that they are able to compete with western European producers and also with producers from other V4 countries. They just have to adjust to a tough competition."

A campaign for support of Slovak products turns out to be quite necessary to make our economics flourish and influence people to lower the unemployment rate and support Slovak firms. Such a campaign has had a positive impact on domestic production in Austria. It helped to increase the distribution of home made products by about 17 percent. In Slovakia such a dramatic result has not been seen however, but the campaign still has 3 more years to go.

16-08-2003