The government of Montenegro has launched the „Kupujmo domaće“ (Buy Domestic) campaign to promote purchases of local food products, in collaboration with industry partners.
The initiative is a joint project involving the government of Montenegro, the chamber of commerce, retail chains and producers. As a result, Montenegrin products have been visibly marked on the shelves of the six largest retail chains - Voli, HD Laković, Franca, Aroma, Idea and Megapromet.
Lack Of Product Visibility
Deputy prime minister and minister of agriculture and rural development, Milutin Simović, said that the state has the duty to strive to eliminate all elements of unfair competition. He said that domestic products stand out for their quality, freshness, and local origin, among other criteria.
In a release, economy minister Dragica Sekulić commented that as a WTO member and signatory to the CEFTA agreement, the Montenegrin government cannot favour domestic products over imports, but that it can help to make them more visible.
She pointed out that Montenegrin producers find the lack of visibility of their products on local shelves very challenging. Public opinion polls have also shown that consumers feel they are not sufficiently informed about local products in stores.
The main grocery retail chains claim that the number of Montenegrin products in their stores is constantly growing and amounts to between 1,500 and 3,500 articles. These consist of mostly food products from the cured meat and dairy product categories, and to a lesser extent fruit and vegetables, alcoholic beverages, juices, water, olive oil and honey.
Top Five Retailers
The Montenegrin grocery retail market is the least consolidated of all markets in the former Yugoslavia region, with the top five retailers accounting for 69% of the market, and traditional retail still making up a considerable share.
The market leader, with a 21% share, is Mercator-CG, the local unit of Slovenia’s Mercator Group (in turn controlled by Croatia’s Agrokor), with 113 Idea stores in 17 cities and towns.
Just behind is Voli (20% market share), with 63 food retail stores across the country. Podgorica-based Hard Discount Laković (HDL) is the third biggest player (13%) and the only hard discounter, operating both supermarkets and hypermarkets.
The top 5 is rounded up by Franca Marketi (8% share) that has 47 supermarkets in 18 cities, and Domaća Trgovina (7% share), with 43 of its Aroma Market supermarkets in 13 cities, as well as its Conti discount stores (located in Bar, Podgorica and Nikšić).
Preliminary figures published by Montenegro’s statistics office Montstat show that retail trade grew by 3.3% in 2017, or by 5.2% at current prices.
Grocery retail prices increased by around 2% from 1 January 2018 after the introduction of a new VAT rate. In addition to the general VAT rate of 21%, there is a lower 7% rate for staple products (bread, flour, milk and dairy products, meat, fat, oil, and sugar).
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: European Supermarket Magazine
