Diminishing profit margin characterises the pasta market

Volume sales didn’t decrease significantly on the domestic pasta market, but manufacturers’ experience is that sales have moved in the direction of cheaper varieties made with fewer or no eggs, which are often sold as private label products.

According to Norbert Káhn, director of commerce at Gyermelyi Zrt., in pricing manufacturers could only react to hectically changing ingredient prices and increasing costs with a delay and this led to the diminishing of the profit margin. Unfortunately there were manufacturers who tried to solve this problem by breaking the regulations, e.g. manufacturing frauds, not issuing invoices, etc. Because of the constant price competition packaging sizes keep changing. Cheaper pasta varieties more and more often come in family sizes. Pastas with higher egg content (8 or more) are more frequently available in 200g version instead of 250g packaging. Anita Hajduné Reinwald, key account director of Mary-ker Pasta Kft. told our magazine that promotion campaigns are an absolute must. Her view is that in comparison with previous years cheap imported products of dubious quality are losing ground, thanks to the strict regulations of the Codex Alimentarius and to frequent in-store inspections. Consumers also came to realise that Hungarian products are not only of good quality but buying them also saves jobs – Mary-Ker products are proud to bear the ‘100% Hungarian’ marking. Zsolt Juhász, director of commerce at Izsáki Homemade Pasta Kft. added that because of Hungarian eating habits imported no-egg or durum pasta varieties would never be as popular as high-egg-content pastas. Despite their healthy image durum pastas have been unable to broaden their buyer base significantly; what is more, they aren’t cheap anymore either, due to elevated durum wheat prices. Gyermelyi Zrt. left the crisis behind stronger than before, having increased sales in both Hungary and abroad. Their Vita Pasta durum product line and Donna Pasta 1-egg and no-egg pastas managed to acquire new consumer groups for Gyermelyi. They also came out with premium artisan products and seasonal pastas. Mary-Ker Pasta Kft. saved the production line of the prestigious Cerbona factory in Székesfehérvár by renting it for a year and using it. By doing this the company not only created jobs but also increased its production capacity – the plan is to sell the surplus output in Hungary. Izsáki Homemade Pasta Kft.’s main goal this year is the 100-percent utilisation of its present production capacity and increasing its export. This entails expanding its product assortment, which is impossible without having a high-capacity warehouse – construction work has already started. Other plans include updating the packaging of products and putting new formats on the market.