Polish food industry: a successful transition

PolandSince Poland joined the European Union, the country has experienced an impressive economic growth, encouraged by the vitality of the interactions between the member countries. A branch which developed more than ever on the market is the branch of the food industry, which produces in mass at very competitive prices. Overview on a success we had not seen coming.

An historical transition

Indeed, since Poland is a member of the EU, its profit on the export of food products tripled. Consider the following example : if you think about it, it is no coincidence that Berlin attracts more and more tourists who gladly boast low prices of the German capital, especially when it gets to its restaurants and bars. Germans are not stupid, they know that Poland is only half an hour away, and there, food and beverages are twice cheaper than in Germany. This example can be reported on a European level since today, many countries have realized the profit that can be made in the purchase of food products from Poland. However, to make its industry more competitive, Poland first went through a difficult phase,  namely the transition that was launched in 1989 for the country to move from a planned economy to a market economy. This new policy was launched in order to keep up with other states members, but also to finally say goodbye to any kind of privatization, which happens to remain a disturbing trace of the polish communist past. However, the transition was successful, as it was supported by an heavy agricultural heritage of the country which allows the mass production of food products, although the sector only employs  15.2 % of the population. Therefore, the country attracts more and more investors who consider Poland as the next country to be conquested. The dominant industries are meat, beverages and dairy industry, but the country remains famous for its production of potatoes and vegetables.

A vertical industry

Groceries and food sectorAs mentioned above, agribusiness is a key sector of the Polish economy. However, the poor infrastructure, low wages and lack of innovation are factors that threaten the food sector. However, notable progress have been made regarding retail sale through the groceries channel of distribution. Indeed, Polish eating behavior also influenced the food industry: more than 50% of the population declare to get their supplies from grocery stores, while supermarkets and hypermarkets occupy only 21 % of the market. Therefore, the production of vegetables remains local, and thus of an higher quality, which made ​​it very popular on the European market since Poland is the fourth largest producer of vegetables in Europe. There are approximately 600,000 companies dedicated to the production of vegetables corresponding to 508,000 tons of fresh vegetables every year, with a value of almost € 338 million. The food sector is thus a branch so that exports well, but still: Poland remains handicapped by its infrastructure and poor transportation, which is not suitable to develop an industry based on the export. Therefore, we will see if the recent investments will bear fruit.

 

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