Bulgaria Food and Drink Report Q4 2008

Publication Date	October 2008
Publisher	Business Monitor
Product Type	Report
Pages	68
ISBN Number	1749-2610
Product Code	BMI02754

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Summary

In BMIs revised Business Environment Rating (BER) table for Q408, Bulgaria is found in eleventh position out of the 14 markets surveyed in Central and Eastern Europe (CEE). While its fundamentals have not changed considerably, the country slid from a more favourable eighth place in the previous period, due to perceived improvements in other regional markets. Nevertheless, the recently secured membership of the European Union (EU) will continue to stimulate the development of the countrys food and drink markets, especially as Western European players look abroad for expansion opportunities and as consumers are increasingly prepared to pay more for premium products.

The belief in the above opportunities is illustrated by a stream of foreign investment in the country. To this end, in June 2008, Swiss food giant Nestl announced plans for a major upgrade of its Bulgarian production facilities. The local factory, which will start producing its new KitKat Senses chocolate bar, represents just the latest investment in the companys Bulgarian operations, which have clearly gained in importance over the past few years. Similarly, French alcoholic beverages producer and distributor Belvdre reported a strong Q108 performance in Bulgaria, posting a massive 55.5% increase in first quarter sales. Bulgaria now accounts for 1.3% of its total business, while sales in the companys core market of France continue to decline.

There is further good news in the soft drinks sector, even though Bulgaria already boasts high levels of soft drinks consumption per capita. In July 2008, the Association of Bottled Water Producers reported that the consumption of non-alcoholic beverages in Bulgaria rose by 11% to 794mn litres in H108, the second-highest level in Europe. The Association is predicting the per capita consumption to reach 240 litres by the end of the year, some 33 litres higher than in the previous 12 month period. The consumption of bottled water was particularly strong, rising to 342mn (up by 13% on H107), although the increase in the consumption of carbonated and non-carbonated drinks was somewhat less dynamic, rising by 7% and 8% year-on-year, respectively.

However, the overall positive outlook for Bulgarian food and drink market opportunities is - to a degree - negated by certain deficiencies of the countrys economic and regulatory base. For example, Bulgaria remains extremely vulnerable to external risks, while also being saddled with high levels of external debt. Similarly, its short-term monetary risk, the burden of bureaucracy and the level of corruption remain high, indicating some of the areas that remain a concern to potential investors.

Content

Executive Summary
Business Environment
Central And Eastern Europe Food & Drink Business Environment Ratings
Regional Food & Drink Business Environment Ratings
Bulgarias Food & Drink Business Environment Rating
- Table: Global Food & Drink Business Environment Ratings Bulgarias Peer Group
SWOT Analysis
Food And Drink
Food And Drink Industry SWOT
Mass Grocery Retail
Mass Grocery Retail Industry SWOT
Macroeconomic Forecasts
- Table: Bulgaria Economic Activity
Food
Industry Forecast Scenario
Food Consumption
- Table: Food Consumption Indicators Historical Data & Forecasts
Confectionery
- Table: Confectionery Consumption Indicators Historical Data & Forecasts
Canned Food
Trade
- Table: Sectoral Trade Indicators Food & Drink Export, Import And Balance Value (US$mn) Historical Data & Forecasts
Industry Developments
Market Overview
Food Consumption
Leading Players
Confectionery
Canned Food
Trade
Agriculture
Dairy
Organic Farming
Drink
Industry Forecast Scenario
Alcoholic Drinks
Hot Drinks
- Table: Hot Drinks indicators Historical Data And Forecasts
Soft Drinks
- Table: Soft Drinks indicators Historical Data And Fore27
Industry Developments
Market Overview
Alcoholic Drinks
Beer
Wine
Hot Drinks
Soft Drinks
Agricultural Commodity Price
Retail
Industry Forecast Scenario
- Table: Bulgaria Mass Grocery Retail Sales By Format (US$bn)
- Table: Grocery Retail Sales By Format
Industry Developments
Market Overview
Leading Players
- Table: Structure Of The Mass Retail Grocery Market By Estimated Number Of Outlets
- Table: Bulgaria Mass Grocery Retail Sales By Format (US$bn)
- Table : Annual Average Value Of Sales Per Outlet By Format, 2007
Competitive Landscape
Key Players
Food And Drink
- Table: Key Players Bulgarias Food & Drink Sector, 2040
Mass Grocery Retail
- Table: Key Players In Bulgaria's Mass Grocery Retail Sector, 2007
Company Analysis
Food
Unilever Bulgaria
Kraft Bulgaria
Nestl Sofia AD
Drink
Zagorka (Heineken)
Mass Grocery Retail
Metro Cash & Carry Bulgaria
Billa Bulgaria
CBA Bulgaria
Piccadilly
Recession Scenario
Global Scenario
- Table: World GDP Growth
- Table: US GDP Growth, Investment Growth And Private Consumption Growth
- Table: Eurozone GDP Growth
- Table: Asia, Excluding Japan, GDP Growth
- Table: China GDP Growth
- Table: Mexico GDP Growth
- Table: Africa GDP Growth
CEE Food & Drink Scenario
- Table: Impact Of Deep US Recession On Total Food Consumption (US$Bn) In Selected CEE Markets Cumulative US$ Impact Over 5yr
Forecast Period
Appendix
Food & Drink Business Environment Ratings
Ratings Methodology
Ratings Overview
Ratings System
Indicators
Limits Of Potential Returns
Risks To Realisation Of Potential Returns
Weighting
Weighting
BMI Food & Drink Industry Glossary
Food & Drink
Mass Grocery Retail
BMI Food & Drink Forecasting & Sourcing
How We Generate Our Industry Forecasts
Sourcing