Hungary Food Drink Report Provides Independent Forecasts And Competitive Intelligence...

Hungary Food Drink Report Provides Independent Forecasts And Competitive Intelligence On Hungary's Food And Drink Industry

DUBLIN, Ireland--(Business Wire)--
Research and Markets
(http://www.researchandmarkets.com/reports/c87228) has announced the
addition of "Hungary Food and Drink Report Q2 2008" to their offering.

BMI's Hungary Food Drink Report provides independent forecasts and
competitive intelligence on Hungary's food and drink industry.

Testing times are ahead for Hungary, with prospects of a sharp
drop in external demand, in addition to ongoing fiscal tightening
measures, threatening to undermine overall macroeconomic stability in
the medium term. Inevitably, this will have a major effect on the food
and drink industry, especially given the importance of premiumisation
in driving growth. The sharp slowdown in economic activity in the US
and across the eurozone will weigh heavily on Hungary's economy, and
rising prospects of a more pronounced slowdown in external demand in
present new challenges in 2008. With Hungary's regional
competitiveness increasingly waning amid eleven-year low real GDP
growth data and low levels of direct investment into the economy, we
believe that there may be growing pressure on the government to resume
spending programmes towards the latter part of 2008. A reflection of
this decreasing regional competitiveness is the reports that were
circulating in the press at the end of 2007 that UK retailer Tesco's
Hungarian operations are planning on cutting some 3,000 jobs. Although
the company has denied these reports, speculation is still continuing
regarding Tesco's intentions for the country. Although Tesco has
demonstrated its dedication to the Hungarian market in the past, a
struggling economy and disappointing results in 2006 have led to
speculation that Tesco may be reconsidering its strategy for its
international operations, and may shift its focus to more lucrative
markets eastward.

Although such economic difficulties come as bad news for the
industry as a whole, these periods of economic downturn do present
opportunities, particularly for discount stores. This difficult
economic situation, which we have been highlighting for some time now,
could well be why German discounter Aldi has decided to finally make
its market entry, with plans to open its first Hungarian store in
April of this year. Although Aldi had originally planned to enter the
market in 2006, it decided to postpone its market entry due to market
saturation. However, Aldi's plans to enter Hungary underline that as
markets mature and reach certain income levels, economic problems may
in fact brighten the picture for discounters as they attract more
cost-conscious shoppers away from other types of store. Overall, the
more modern retail formats, particularly hypermarkets and discount
stores, have proven highly effective and popular with Hungarian
consumers. BMI is currently forecasting that total mass grocery retail
(MGR) sales will continue to expand, reaching US$25.14bn by 2012. The
main engines for this growth will be hypermarkets, with growth of over
178.3% between 2007 and 2012. Discount stores will also benefit from
continued price-conscious shopping habits with an increase of 83%
between 2007 and 2012. But if this economic downturn continues in the
long term, then we will amend our discount sales forecasts upwards
accordingly.

Companies Mentioned:

Tesco

CBA Kereskedelmi

Drink

Sio-Eckes

Heineken Hungaria Breweries

Coca-Cola Beverages Magyaroszag Kft.

For more information, visit
http://www.researchandmarkets.com/reports/c87228

Research and Markets
Laura Wood
Senior Manager
Fax: +353 1 4100 980
press@researchandmarkets.com

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