Difficult period for FMCG logistics in Hungary

According to János Mondovics, member of the board of the Hungarian Association of Logistics (MLBKT), the current recession is having an amplified effect on providers of logistic services. – This year has been quite negative so far. Revenues generated in the FMCG sector have dropped, while costs have increased – pointed out János Mondovics. Recession has had an adverse effect on the logistics sector and some companies are now fighting for survival. A number of companies are reducing their prices in order to win some time. However, this process increases uncertainty and threatens the survival of smaller enterprises. Similar factors have probably contributed to the collapse of Rynart, one of the biggest companies in the sector, which had achieved a huge market share with unrealistically low prices. FMCG-logistic remain a challenge for multinational companies, as the proportion of small stores is still around 40 percent. While overall growth in the FMCG market amounted to nearly 9 percent in the first half of 2008 compared to the same period in 2007, the biggest growth was achieved in connection with supermarkets (25 percent) and chains of small stores (13 percent). As a result, the importance of city logistics (supplying retail units located in city centres) has continued to increase. City logistics pose a much bigger challenge than serving units located in suburbs.