Poland Market Overview Bord Bia Frankfurt November 27th 2008 Polish Market Overview • Population 38 5 million The main cities are Warsaw 1 6m Lodz 783 700 by byu58938

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									    Poland
Market Overview




  Bord Bia, Frankfurt
  November 27th 2008
Polish Market Overview


•   Population: 38.5 million.
    The main cities are Warsaw (1.6m), Lodz
    (783,700) and Krakow (734,400)

•   Language: Polish (Official)

•   Currency: Polish Zloty

•   Joined the EU in May 2004

•   One of the lead economies in Central
    and Eastern Europe due to its high
    population.
Market Overview


•   Great wealth gap between the country and the other Western Countries.
    GDP per capita €7,774.08 (2007) v Germany €28,012 (2006)

•   GDP growth rate predicted to be 4.7% in 2008 (IGD, 2007)

•   Inflation rate: 3.1% for 2008 (IGD, 2007)

•   Unemployment one of the highest in Europe,12.1% but is falling (IGD,
    2007)

•   Consumer spending increasing (+18.9% 2007 v 2006)

•   VAT on goods and services: 7%

•   VAT on Food: 3% for unprocessed, 7% for other foodstuffs
Irish Food Export Performance


                                                  Irish Food exports to Poland 2007
                               Beverages        Live Animals
                                 10.9%              0.2%
                                                                    Meat
                                                                   25.2%

                  Miscellaneous Edible
                          41.4%



    Total                                                                     Dairy
                                                                              1.2%

   Exports:
                                                                                Fish
                                                                                8.3%
   €46.7mn                                                                      Vegetables and Fruit
                                                                         Sugars        1.5%
                                                                          3.5%

                                                               Coffee,tea, cocoa, spices
                                           Animal feeds
                                                                         1.8%
                                              5.9%


  Source: CSO Food and Drink Statistics 2007
Key Consumer Trends
in the Market

  •   Solid growth in retail sector: 11.9% in 2006 (IGD, 2007).

  •   Per capita spending high in large cities (60% higher than national
      average), weak in poor rural areas.

  •   Roughly half of retail sales in Poland are generated through the food
      retail sector.

  •   Polish consumers are known to be extremely savvy and price
      conscious.

  •   A recent law (2007) has come into force in Poland restricting the future
      size of Hypermarkets, so compact hypermarkets are becoming popular
      (IGD, 2007).

  •   20% of Consumer expenditure is on food and non alcoholic beverages
      (IFE, 2008).
Retail Grocery Market



 •   Grocery Retail Value: €38.9 billion (Agri Food, 2008)
 •   Hypermarkets leading store format, 15% of national distribution. Tesco
     is the leading player. Others include Metro Group (Real), Carrefour,
     Auchan, Schwarz Group (Kaufland).
 •   Metro experienced a 9.4% growth in sales in 2006 to reach €2.687
     billion (IGD, 2007).
 •   Supermarkets - Tesco, Carrefour, Intermarche, Polomarket, Rewe
 •   Discounter: Dominated by Biedronka (Jeronimo Martins), Schwarz
     Group (Lidl), Dansk Supermarked, Auchan’s Atak. Aldi Nord has
     recently entered the market (2007).
 •   Discounters have had heavy growth with Biedronka’s sales up 18.9% in
     Q1 2007.
Retail Market by Type



                                    Grocery Market by type   Cash and Carry
                                                                  2%



                      Hypermarket                             Discounter
                         36%                                     32%




                                             Supermarket
   Source: IGD 2007                             30%
Retail Grocery Market



 •   Independent neighbourhood stores play an important role in national
     food supply especially in small towns and poor rural areas as well as
     cities.
 •   Kiosks - huge number spread across the country. State owned Ruch
     chain leading player (10,000 throughout Poland).
 •   Cash & Carry sector: Dominated by German Metro (Makro, Real),
     Rewe’s Selgros, Emperia Holding, Eurocash.
 •   Piotr i Pawel and Bomi are 2 premium supermarkets to have
     experienced growth in recent years with Piotr's sales up 17% to 216
     million in 2006.
Market Share of Top Ten Retailers


                              Rewe
                   Eurocash    5%        Metro
                      6%                 19%
            Lewiatan
              6%


          Carrefour
            8%
                                                 Spolem
                                                  13%
           Schwarz
            Group
             9%

                                           Biedronka
                   Auchan
                                              (JM)
                    10%          Tesco        12%
                                  12%
          Source: IGD, 2007
Retail Market Structure
Top 10


 Retailer               Total       Grocery        % Change       Grocery      No. of   Sales
                        Sales        Sales          Grocery        Retail     Grocery    Area
                        (€m)          (€m)        Sales (06 vs    Market      Stores    (sqm)
                                                      05)        Share* (%)
 Metro                  3,447         2,687           +9.4%        2.67%        74      416,751
 Spolem                 1,807         1,807           +2.2%        5.27%      >4,000    800,000
 Jerónimo               1,715         1,715           +27.2%       5.00%       905      452,952
 Martins
 Tesco                  1,583         1,583           +18.4%       4.62%       144      435,251
 Auchan                 1,475         1,438           +3.5%        4.20%        34      194,000
 Carrefour              1,189         1,189           +15.77%      3.47%       125      418,000
 Lidl &                 1,250         1,250           +54.3%       3.65%       220      356,000
 Schwarz
 Rewe                    661           661            +17.0%       0.24%        35      70,000
 Leclerc                 525           520            +12.2%       1.52%        19      83,900
 Eurocash                507           507            +15.5%       0.74%      >2,600    644,000
 Lewiatan                500           500            +4.2%        1.46%      >1,300    260,000
 Source: IGD Analysis, Country Presentation, Poland
Private Label


 •   First appeared in 1998
 •   Accounted for 16% of sales in 2006
 •   Number of SKU’s increased 80% since 2004
 •   Considered as a product with very low quality or for ‘poor people’
                            Private Label Share % (2006)
                       80

                              74.4
                       70    (72.7)

                       60
     % Private Label




                       50
                                        49.7
                                       (50.8)      44.4
                       40                         (47.7)

                       30

                       20
                                                               17.7
                                                              (18.1)      13.4
                       10
                                                                         (15.6)   10.5     10.3              1.7
                                                                                  (9.8)   (12.0)    7.2     (3.0)
                                                                                                   (8.6)
                        0
                            Jeronimo   Casino   Tengelmann   Carrefour   Metro    Tesco   Ahold    Auchan   Rewe
                             Martins
                                        Source: IGD Analysis Country Presentation Poland 2007
Foodservice Trends


 •   Increasing disposable income and changing consumer habits drove
     growth in consumer foodservice in 2006.
 •   Consumer foodservice is highly fragmented but domestic companies
     dominate the market and this is through lower prices and tailored
     offerings. Outlets such as Da Grasso, Sfinka Polska and Pizza
     Dominium were the most successful in 2006.
 •   Independent outlets are the most dominant in terms of numbers and
     they cover the entire range from economy to premium. Despite not
     having the economies of scale of large chains they often offer lower
     prices.
 •   There is low urbanisation in Poland and the numbers living in urban
     areas is almost unchanged since the early 1990’s (62%); reasons for
     this relate to an ageing population and high unemployment - cost of
     living is lower in rural areas. This could be a limiting factor in consumer
     foodservice.

                          Adopted from Euromonitor Data 2007
Foodservice Trends


 •   There is expected to be expansion into the smaller cities in Poland for
     specialist coffee shops and casual dining full service restaurants, but
     they should bear in mind the lower purchasing power in smaller cities.
 •   Eating out is not part of Poland’s traditional lifestyle and there is a belief
     that home cooking is better quality than food in restaurants.
 •   There has been a number of failures on the Polish market for
     international chains eg Burger King withdrew after losing the price war
     with McDonald’s in 2001. However in 2007 they re-entered the market
     with AmRest running the outlets. There are currently 7 outlets.
 •   Dunkin Donuts also withdrew due to their prices being too high.
     Subway blame disappointing performance on their high costs.
 •   The Euro 2012 soccer championship to be held in Poland and Ukraine
     is expected to benefit foodservice with a higher disposable income
     resulting from investment and will also benefit the economy overall.


                           Adopted from Euromonitor Data 2007
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                                                                                               No of Outlets
Foodservice
Establishments

 •   Sfinks Polska SA
      – The largest restaurant network in Poland operating three brands:
         Sphinx, Chlopskie Jadio and WOOK Restaurant. It is the third
         largest foodservice company in Poland in terms of turnover.
      – Sphinx offers meat, salads, pasta, pizza, and desserts.
      – 108 establishments in Poland, Hungary, Czech Republic, Romania
         102 of which are in Poland.
      – Took over premium restaurant chain Chlopskie Jadlo in 2006
      – Chlopskie Jadlo offers traditional Polish cuisine in peasant
         surroundings
      – Currently 12 restaurants in operation
      – WOOK offers authentic Chinese food in
         3 restaurants in Poland.




                                                 Chlopskie Jadlo Peasant Style Restaurant
Foodservice
Establishments



 •   Green Way
      – Polish vegetarian restaurant and bar chain
      – founded in 1997 as a healthy eating restaurant
      – 31 Greenway restaurants throughout Poland
      – 1 in Austria, 1 in Norway
      – Menu includes lentil soup, spinach dumplings, vegetarian
        enchiladas, fruit filled pancakes, vegetable juices and smoothies.
      – Greenway markets also sell products free from meat and animal
        derivatives
      – www.green-way.pl
Foodservice
Establishments



 •   Pizza Dominium
      – started in Warsaw 1993
      – offer handmade, original Italian pizzas,
         soups, snacks, salads, pasta and
         sandwiches
      – over 50 restaurants in cities throughout
         Poland
      – planning to expand into Romania with
         their restaurant chain.
Other Foodservice
Establishments



 •   Coffee Heaven
      - Leading Eastern European Coffee Chain found in Poland, Czech
     Republic, Latvia, Bulgaria, Slovakia
     - Sells sandwiches and snacks as well as coffee
     - First opened in Poland in August 2000
     - Currently has 48 coffee houses in Poland
      www.coffeeheaven.eu.com
Reasons for targeting Poland



 •   Largest Eastern European market currently for Irish food exports
 •   Total retail market +45% for 2005-2015 (€41.1bn)
 •   Solid growth market >10% per annum
 •   High penetration of premium segment for alcoholic beverages (32%)
 •   Significant immigrant population returning from Ireland with knowledge of
     Irish brands
Barriers/challenges in supplying
Polish market



 •   Market for high end premium products is small
 •   Foodservice market fragmented
 •   Very low per capita consumption of beef (5.2kg per annum)
 •   Price conscious consumers
Bord Bia services 2009



 •   Beverage category report including market visit and buyer meetings (May
     2009)

 •   Bord Bia market mentor available for Eastern Europe market and trade
     related queries:


 Kieran Fahy
 Sarospatak ut 32
 1125 Budapest
 Hungary
 Tel: +36 706 144871
 Email: Kieran.fahy@freemail.hu

								
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