Five Reasons to invest in Greece’s Food and Beverage Sector
Food and Beverage (F&B) is the most dynamic and high-growth sector of Greek manufacturing, contributing decisively and steadily to the country’s exports. The total F&B export value for 2011 was 3,655,881,821 Euros, and has been steadily rising for the last six years. The share of F&B industry exports of Greece’s total foreign trade was 16.28% in 2011. The EU is the major export destination for Greek F&B products, accounting for 31% of Greek export activity.
F&B enterprises represent around 23% of total manufacturing enterprises, with 16,695 companies active in Greece in 2009: 893 are industrial companies with a prominent domestic and international presence and the remainder are SMEs. Sales amount to 9.74 billion Euros, accounting for 26.2% of total manufacturing and the industry employs 91,847 people, accounting for 22.9% of total employment in manufacturing.
The F&B industry sector has proved most resistant and adaptive to the current financial crisis. Its annual changes in key figures as a total are less volatile than those of the general manufacturing sector. During 2011 there was a deceleration in industrial production, but which was lower than the total industrial sector.
In 2009, when the recession in the domestic economy started, the industry received a major setback in terms of employment, value added, sales, gross value of production and investment—recording a relative drop in these volumes. However, this reduction stems not from the larger industries (more than 10 people), but mainly from smaller companies, which constitute the vast majority of the food industry (95%) and beverage industry (90%).
In 2011, industrial production in most sectors of the economy was reduced as a result of the recessionary economy and the absence of major investments. In the food industry, industrial production in 2011, in comparison with the previous year, decreased by 2.4%, which was milder than the annual reduction in 2010 compared with 2009 (-4.1%). In 2011, the contraction of total industrial production was nearly three times that of food (-8.6%). This difference reflects the relatively smaller losses within the food sector relative to other industrial sectors, due to the financial crisis, both in the first period of the crisis in 2009, and during the subsequent recession in 2010 and 2011.
The production of bakery and flour products, dairy products and beverages are the major subsectors. Specifically, bakery and flour products hold the greatest share of businesses in the total sector (60%) and in businesses employing more than 10 people (33.5%). In businesses employing fewer than 10 people, this subsector accounts for more than 50% of the total compared with other sectors at basic structural sizes. In terms of turnover, dairy products and beverages hold the largest share of food and beverage, which represent approximately 40% of the total. In businesses employing more than 10 people, these two sub-sectors hold the biggest share in terms of sales, both of which reach 20% of the total.
Advantages and Key Business Drivers
F&B is a privileged sector, offering many benefits to international entrepreneurs, and a promising future, as it will continue to be the steam engine of Greek manufacturing. Its low operating costs and the abundance of raw materials make it one of the most attractive sectors of the Greek economy. In addition, further development of small, local production and the reinforcement of competitiveness are key business drivers, together with further reinforcement of R&D and innovation at the industry level to respond to new consumer needs and preferences (for example, demand for convenience and specialized products based on safe, healthful and high quality ingredients). Finally, strategic alliances and further human resource development are key industry priorities in the immediate future.