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Since 1995, collective voice of local brand manufacturers ~ 60 member companies, 90% of the FMCG market Full member of AIM (European Brands Association, 350 Bn turnover across Europe by 1,800 members) Full member of WFA (World Federation of Advertisers, 90% of global ad spends)
Membership
To create for brands an environment of fair and vigorous competition, fostering innovation and sustainability thus guaranteeing maximum value to consumers now and for generations to come. Make the case for brands to policymakers Promote win-win strategies for retailers Propagate brand values to consumers
Ministry of Economy (NGM) Ministry of Rural Development (VM) National Tax and Customs (NAV) National Consumer Protection Authorities (NFH) National Anti-Counterfeiting Board (HENT) National Federation of Consumer Protection Associations (FEOSZ) Advertising Self-Regulatory Body (RT) Hungarian Trademark Association (MVE) Competition Authorities (GVH) National Foodchain-Safety Authorities (NBIH) National Food-Processors Federation (FOSZ) National Trade Association (OKSZ) ECR Hungary Interbranch associations, other trade associations, etc
The public image of the industry, especially of multinational companies, gets worse and worse.
Profit repatriation by multinationals is on the rise, they pay no taxes, they drive out the local SMEs from the market. They feed us with cheap imported rubbish, good old Hungarian produce is nowhere to find, they destroy local farmers and food industry. Expensive brands are no better than the cheaper products, we only pay a price premium for their stupid ads.
Media is reluctant to falsify these beliefs and politics is even keen to further stress them. This endangers our industry interests and also hinders reliable planning and long-term business activities.
Expose the real economic weight and role of our members and the FMCG-industry Find fact-based evidence for an information campaign Start pro-active communication to positively shape government, consumer, and media perception Falsify popular myths and unfound stereotypes Improve our lobbying positions, create a level playing field
Quantitative on-line survey with uniform and methodologically agreed questionnaires Voluntary membership input 49 respondents vs. 56 total members (missing input of 7 later added using official public e-reports and balances)
Internal check based on public sources External check by BGAs reputed tax advisor firm
Main findings
Number of members: Company originally established, avg: Company locally established, avg: Local FDI so far (39 responses from total 56): Number of local manufacturing sites: Number of employees , 2011: Net sales revenues, 2011: Taxes and dues, 2011 (43 responses from total 56): R&D spends so far (22 responses from total 56): Ratecard media spends, 2011: Number of local suppliers, 2011: Local purchases, 2011 (44 responses from total 56)): Ratio of local suppliers, 2011: Number of main brands, 2011: 56 1905 1984 680 Bn HUF 98 22,869 1,793 Bn HUF 452 Bn HUF 15 Bn HUF 105 Bn HUF 29,308 471 Bn HUF 61% 795
Ratios
As compared to the average local company, BGA members create far more value in every possible aspect but it is the Taxes and Dues Paid value comparison that makes the real difference.
Number of companies
56 BGA members
BGA data (basis = 1 member)
5,3 Mn HUF / yr
272 Mn HUF / yr
51 X
70 X 310 X 5653 X
Corporate values
Quality is the most important value, closely followed by innovation, reliability, respect, tradition, and sustainability. Many consider as value creativity, team work, awareness for environment, and also being a Hungarian company.
Brand value
Quality
Reliable
Innovation
Creativity
Honour
Spirit
Munkahelyi biztonsg
Elktelezettsg Nemzetkzisg
Felelssg
Hungarian Sustainability
Environment
Experience
Oktats
Fggetlensg Szenvedly
Transparency
Credibility
Customers
Openness
Hossz tv Hatkonysg Trsadalmi Vllalati siker kltra felelssgProfessional szintesg vllals Prmium Klcsnssg Tradcik termkek Kiszmthatsg zletes termkek Kivlsg Kvetkezetessg Szabadsg Vilghr
601-1000 9%
51-100 16%
61-80% 22%
41-60% 16%
Number of local suppliers of raw material and services? N= 45 / data% Percentage of raw materials and services from local partners? N= 45 / data %
Corporate responsibility
In 2011, 73% of the BGA membership did have a CSR program. Every second such member was active in the field of health, social care and environment. Every fourth member supported youth and sports and every fifth supported culture and education.
Egszsg / Health Szocilis segtsgnyjts / Social aid Krnyezetvdelem / Environment protection Ifjsg / Youth Sport / Sport Kultra / Culture Oktats / Education
48 48 45 27 24 21 21
Summary
BGA Hungary adds to building a strong and healthy national economy and also a competitive local FMCG-sector. BGA members create numerous jobs and also create a stable market for their local supplier partners. BGA members contribute to generating state revenues by paying an exceptionally high level of taxes and dues. BGA members generate further values in the supply chain through their decisive role in innovation, R&D, marketing and media content. BGA members brought ethical and transparent company cultures to Hungary and they also implement numerous CSR programs.
Next steps Translate research into policies > industry proposals for the government
Propose strategic partnership and cooperation Identify regulatory & economic facilitators & inhibitors to growth Propose to start a constructive dialogue and also a more transparent legislation and enforcement Find a balance between farmers, manufacturers, and retailers, with both local and international background Combat black market anomalies
Decrease food VAT Initiate stricter enforcement Revision of current trade industry regulations