Romanian Economy in Brief with a Focus on the FMCG Off-premise Market. FMCG Market Trends for 2007 – 2008
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Aprilie 2009 |
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MEMRB ROMANIA S.R.L. |
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Splaiul Independenţei, Nr. 202
Cladirea Icechim
Bucureşti, Sector 6
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+40-372-73.85.46
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+40-31-228.35.30
Website
www.memrb.com
Snapshot on latest macroeconomic results
Both EU 27 and EU 15 registered a 0.2 per cent GDP drop in the third trimester, against the second trimester of 2008 and EU’s economy is officially in recession according to Eurostat.
Romania has the highest economic growth in EU 27. With a 9.1 percent economic growth in the third trimester of 2008, Romania ranks first in EU 27 in terms of economic growth, according to the European Statistics Office (Eurostat). Slovakia with a 7.1 percent advance and Poland with a 5.2 percent economic growth follow Romania.
Yet Romania has the lowest minimum wage compared to the purchasing power, of all the 27 EU member states. Minimum wage reached EUR 137 in 2008 in Romania, while in Bulgaria it stood at EUR 112.
National Prognosis Commission predicts a 5% increase of the food categories in 2009 with a higher rate in the first half. The Food players make also optimistic forecasts by arguing the consumption in Romania is closed to basic products rather than niche categories.
FMCG market development performance within both off-premise and modern trade
The current article is an analysis on the FMCG market, concerning over 80 categories currently monitored on a regular basis by MEMRB within the retail segment. The study focuses on the evolution of the sales value for all analyzed categories; the FMCG market was divided into four main segments: Food, Non-food, Beverages, Cigarettes.
The analysis covers off-premise channels, both modern and traditional trade, 2008 versus 2007, on a four-months basis.
All markets grew in 2008 compared to the previous year; the growth rate reached a peak during May-August 2008. However, starting with the last four moths of the year, there can be noticed a decrease in the growth rate for all category groups.
Within total Romania (off-premise trade), the FMCG Market increased by 22% in September-December 2008 compared with the same period of the previous year, while the price increased by 12% based on the same reported period.
Non-Food categories were the least dynamic categories, with 9%, 15% and 14% increase in each of the three compared periods.
Beverages were the most dynamic group of categories, surpassing the growth registered by the market in the last two reported periods, reaching 32% of the total FMCG market. In January-April 2008, Beverages followed the FMCG market evolution, while the average price decreased by 5%.
Food, the most important group of categories within the FMCG market, increased by 24%, 31% respectively in the first two compared periods of 2008. In the last period, despite registering an increase as compared to the same period of the previous year, the ascending trend diminished its growth, reaching 20% as compared to the similar period of the previous year. A reason for this diminishing growth rate can be traced back to the considerable increase in the average price for the Food categories: 12%, 17%, 17%. The most important categories within the Food segment are Processed Meat, Coffee, Snacks, Chocolate, Dairies and Cooking Oils, covering 66% of the total segment; all these categories registered a slight down trading towards the end of the year.
Cigarettes increased over the inflation rate in all three compared periods, diminishing also its growth rate in September-December 2008.
