The Hungarian market, albeit European, is not an easy market to enter. Mr Doukas Marinopoulos, First Counsellor for Economic & Commercial Affairs, Head of Economic & Commercial Affairs Office at the Greek Embassy in Budapest talks to Ambrosia Magazine and helps us decode the difficulties, but also the great potential for the Greek exporting brands.
Which is the most important asset of Greek f&b products in Hungary?
As far as I’m concerned, it is the quality combined with their reputation. The Hungarian market knows and recognises Greek products in the sector, they are highly appreciated by the Hungarian consumer, who is also a connoisseur of healthy Mediterranean diet. It is generally accepted that international markets are looking for national, traditional flavours. The national product, which combines quality and reasonable price, is highly appreciated by foreign consumers. The same is the case with the products of the sector in Hungary. Quality is also the main comparative advantage that the extroverted Greek enterprises in the sector have and promote in international competition. These, combined with an elegant packaging, a targeted promotion and distribution in the Hungarian market ensure successful results and high acceptance of the Hungarian consumer, despite the intense competition.
Which Greek products have the greatest potential and how can their position in the market be improved?
Bearing in mind the current trends (by product) as well as certain success stories, important outward-looking Greek firms have managed to maintain their market shares in the strongly growing international markets, even increasing their exports at high rates over the last decade, making the most of the endogenous comparative advantage of Greek products.
More specifically, I am referring to olive oil, which has the most important comparative advantage due to its quality and therefore, despite competition from Spain and Italy, promises significant added value, ensuring stable, healthy profitability.
Next come fruit and vegetables. While our country has a significant production capacity and is a leader in exports to Europe, especially citrus fruits, I believe that the momentum developed in recent years could be further increased. This could happen by implementing a new strategy, improving the production range, since almost all Greek exports of fresh fruit and vegetables are limited to a short period of time (less than four months, in general). I am convinced that, with the proper investment initiative, the seasonality of these products can be reduced, so that their presence on international markets can be prolonged. In any case, our country has an advantage over Hungary in terms of early production, especially for vegetables (tomatoes, cucumbers, cabbages, lettuce, lettuce, asparagus) and fruit (lemons, mandarins, kiwis, apricots, sultanas, watermelons).
Greek dairy products have a global reputation and are synonymous with quality. The competent industries have the know-how and of course the experience to produce unique innovative milk products.
There is also enormous potential for table wine, as Greek wineries have adopted good practices in order to offer a competitive product at international markets, especially within the EU. Greek wine matches with Greek food, which in turn is intertwined with a healthy Mediterranean diet. In order to improve their dynamics, the promotion of Greek wine in foreign markets should be continued, to a large extent, focusing on the particular qualitative characteristics of the wine-growing regions, as well as the indigenous varieties, in an effort to establish Greek PDO & PGI wines on the global wine map.
There is plenty of space within the Hungarian market for food products such as nuts, pulses (lentils, beans) and various frozen vegetables (peas, carrots, broccoli, spinach, cauliflower). These products are appreciated for their taste, as are food products made from natural ingredients and organically grown, table olives, honey, halva, fruit compotes, traditional pastries and sweets, mastic, traditional drinks of our country, ouzo.
What are the challenges for Greek companies that want to do business in Hungary?
In order to export/operate in Hungary, become familiar with Hungarian companies and create the necessary commercial trust, Greek companies have to follow a systematic approach of the market. To convince Hungarian companies to diversify their suppliers or to change their long-term partnerships, Greek export companies should be able to offer products with a significant comparative advantage (price, packaging, appearance, brand awareness) over other competitors with similar products, such as Italy and Spain.
Food products which are substitutes or competitors for similar Hungarian products are treated with reluctance, scepticism and are not treated equally.
Furthermore, geographical and cultural proximity as well as the common mentality of Hungarian companies enables them to seek cooperation with companies from these countries. Both the diet habits of Hungarian consumers, which differ in several aspects from traditional Mediterranean food products, and the existing disposable income play an important role in this respect.
The right choice of an agent with knowledge of the market is usually the best way of entering the market and developing exports. However, in order to select the right person, it is necessary to visit Hungary and make personal contact with potential agents.
Hungary has seen the development of large supermarket chains (mainly of multinational interests), department stores and hypermarkets, and the presence of discount chains. In terms of sales volume and value, the large supermarket chains (TESCO, SPAR, AUCHAN, METRO) have the lion’s share. There are also around 10.000 independent shops and retailers, organised in large groups of consortia: CBA, COOP Hungary and Real Hungaria, which together constitute a considerable force in the retail sector.
The sector of ‘discount’ chain stores have also been very active in recent years. These chains have become particularly popular with the average Hungarian consumer who considers them more affordable, from a financial point of view, than traditional retailers. The LIDL and ALDI chains have significantly expanded their appeal to the consumer and have expanded with a wide network of branches. Similarly, in the provinces, the “discount” chains PENNY MARKET and PROFI have a dynamic presence.
Please name actions that could potentially improve the position of Greek f&b products, thus strengthening exports.
The Office for Economic and Commercial Affairs of the Embassy of Greece in Budapest, in the context of ensuring, supporting and promoting the economic and commercial interests of Greece, on an annual basis adopts, recommends and pursues specific promotional actions for the promotion of Greek products in the local market.
Specifically, it maintains an open channel of communication with trade bodies and companies in order to provide them with direct and useful information. It co-organises, together with Hungarian import companies, programs for the promotion of Greek products that either already circulate or are of commercial interest to them in supermarkets. It monitors the trends and needs of the market by attending specialised sectoral exhibitions of agricultural products and the f&b industry, and informs sectoral bodies and companies in our country accordingly.
Greek Embassy Office for Economic & Commercial Affairs promotes succesfuly Greek gastronomy and the benefits of a healthy Mediterranean diet. This activity has not been carried out in recent years, mainly due to the measures taken to combat the pandemic, but we are aiming to relaunch it in 2023, also by participating in information events for Hungarian buyers/importers, distributors, buyers, restaurateurs, and presenting special data of the Hungarian market in business information workshops organized by various institutions of our country (Enterprise Greece, EVEA, SEVE). It supports the programs of exhibition companies in our country, concerning the invitation of potential buyers, which are accompanied by B2B business meetings.
Which are the best selling Greek f&b products in your market:
According to 2021 statistics, the main products of the sector, which our country exported to Hungary are :
– Peaches prepared or preserved (compotes) €5.84 mm*. This product is, over time, the main Greek export to Hungary and Greece is declared in 2021 (as in previous years) the largest supplier to Hungary (€5.0mm in 2020, €5.3mm in 2019, €3.19mm in 2018, €3.2mm in 2017 and €3.6mm in 2016). Greek exports are followed in order of value for 2021 by Germany (€1.55mm), Bulgaria (€1.39mm) and Italy (€0.76mm).
– Citrus, Navel oranges €2.31mm. Our main competitors in citrus are Spain, Germany, Turkey and the UK.
– Rice, €1.52mm.
– Watermelons and melons €612K. Our country is 3rd among Hungary’s suppliers. In this category our main competitors are Spain and Germany.
– Olive oil €506K. Greek olive oil exports to Hungary appear to be on the rise in recent years, from €200K in 2020 to €239K in 2021. In any case, however, the dynamics of Greek exports of the product are significant, since in 2021 alone Greek exports more than doubled compared to 2020 (112% increase).
– Table olives €397.3K. In recent years, they have shown a remarkable increase, both in value and quantity. The growth rate of Greek olive exports to Hungary is rapid. In 2018, Greek exports recorded a new increase of 29.9% compared to 2017. Despite the slight decrease in Greek exports in value terms, from €369K in 2019 to €367K in 2020, the share of Greek olives in the Hungarian market is increasing by about 8% per year, so that in 2021, our country exported table olives worth €397.3K (an increase of 8.2% compared to 2020).
*mm is the abbreviation for million, K is the abbreviation for thousand.
The Greek Office of Economic and Commercial Affairs in Budapest, Hungary
Address: Szegfű utca 3, 1063 Budapest, Hungary
Tel. +36 1 4132612, +36 1 4132613