Bulgarian raw bars have entered the key German market, and have obtained a premium position at the cashiers, according to Milena Dragiyska-Dencheva
Milena Dragiyska-Dencheva has been managing Lidl Bulgaria since 2007 when the chain store began its preparation for entering into the Bulgarian market. Her career at Lidl began in Germany in 2002 as "Regional Sales Manager" for the Stuttgart and Karlsruhe regions. Her professional development continued at the company's headquarters, where she became responsible for various international projects for Lidl International.
Milena Dragiyska-Dencheva is a member of both the Board of the German-Bulgarian Chamber of Industry and Commerce and the Board of the Council of Women in Business in Bulgaria.
Ms. Dragiyska, you recently announced the nearly 20% increase in revenues from exports of Bulgarian goods to European markets for 2020. How can one achieve growth in crisis conditions?
All I can say is that the quantity and the quality of the work and efforts are crucial for achieving significant results. During 2020, a difficult year for all of us, we managed not only to sustain our export volume but also achieve an increase of over 20% in the turnover - from BGN 40 million in 2019 to almost BGN 48 million in 2020. This is nearly 8 million more than in 2019. Here it is the important thing to mention - for objective reasons the Covid situation has led to sales declines in freshly baked bread and bakery products and this occurred not only in Bulgaria but also in other markets. Despite this drop, we managed to achieve growth in exports and the main reason is that we significantly increased the number of exported products, as well as the number of countries to which we export.
If we look at the five-year plan, the figures are indicative - from 2016 until today the total growth is nearly 300% - from BGN 13 million export turnover in 2016 we have reached BGN 48 million for the past 2020. In addition to turnover, we have doubled the number of manufacturers who have access to our European markets. And the number of exported goods increased almost fourfold during the period. All this is possible thanks to 10 years of sustainable policy for support and promotion of Bulgarian producers in the countries where our chain is present. We have based our business on long-term partnerships, which gives our suppliers a space to plan and invest in their production.
Thanks to the security they have as partners in terms of certain volumes and supplies, they invest in modernizing and optimizing their production and therefore become competitive in European markets. That is why I would say that we share the success - together with our producers - and if there is a clear vision, a proper strategy, the right attitude, and shared responsibility, things inevitably work out; they withstand temporary challenges and create new opportunities for sustainable development.
What are the rules for selling Bulgarian goods on European markets and what are the challenges?
Quality is key and, more precisely, an optimal ratio between quality and price - something in which, I dare say, Lidl profiles and is a market leader. So the first step is to provide, in cooperation with our manufacturing partners, quality products at competitive prices. When we have a quality product that has already shown good results on our market, we can safely offer it to colleagues in other countries. The big challenge is to ensure the necessary quantities and the permanence of supply. That is why we rely on the professionalism of our producers - we need quality products, but also responsible manufacturers who meet all the requirements of the foreign market and provide the necessary quantities. And this is often a difficult process, involving many details such as preparation of new labels, packaging, specific logistics routes, and many more. And this is Lidl's role - our dealers are committed to every detail of this process and provide full support to the manufacturer at every stage.
The starting point is usually offering products from our manufacturers for some of the themе weeks. If results are good, the particular country orders a second batch, and, often, the specific product becomes part of its permanent product range. We have managed to build trust in foreign markets - for our quality and professionalism - over the last 9 years since we first started exporting goods and the figures prove it. Our partners show more and more trust with each passing year.
At this point I must note the contribution of Bulgarian customers - they have high requirements and even though they are price-sensitive, they are more sensitive towards the quality of the products they consume - our market is a good test for local producers.
Which are the most exported and successful Bulgarian products?
Bulgaria is a country with limited production capacity and this should be borne in mind when it comes to our products export. In this sense, our country cannot compete on international markets in the production of chicken, for example, or dairy products - simply because we do not have the necessary scale. That is why in most cases we manage to break through with interesting and innovative products - along with some traditional Bulgarian products. They are of very good quality and price, and our partners are extremely professional which generates results.
The raw bars, for example, realize almost 5% of our exports turnover for 2020. They entered Lidl Germany 3 years ago and accomplished revolutionary success, in terms of business - a Bulgarian product was not only being sold - in a fully developed German market but also realized a premium position at the cashier's desk, where competition is the highest. The same goes for rice chips and rice products, which alone had a turnover of BGN 5.4 million last year - over 11% of our total exports. Our long-term partner "Tandem Popovo" also had a big breakthrough with its new products - premium beef from the Black Angus breed and Argentine pasteurized meat for burgers and steaks. The company managed to sell over BGN 3 million with 15 products, two of which are already part of the permanent range in Lidl Romania. Another example of product innovation is "Victoria Nuts" dried fruits with chocolate glaze, which realized a turnover of 1.2 million levs in 18 European countries as part of the festive Christmas promotions. A second similar round is set for the Easter holidays. Traditionally the most exported Bulgarian product is bread - we export various items including bread with seeds which is our top item for 2020, with about 14% of the turnover of all exports for the year.
Will you be able to sustain these results during the global economic crisis and stagnation?
Once again, the word "sustainability" is key. And this goes not only for export planning but for our overall business development policy. For example, in 2021 we plan to increase investments in expanding and modernizing the retail network in a more consumer convenient way - wider shopping halls, more parking spaces, more comfortable and faster shopping. We will open new stores - last month we opened in the Lyulin district in Sofia, in April we will start in Troyan - our 50th city.
We are planning the expansion and modernization of the warehouse in the village of Ravno Pole. We will continue to develop new products and niches with our partners, we will be active in European markets, we will increase our budgets for team training and education, and we will continue to create new jobs while maintaining traditionally high levels of remuneration. Why do we do it? If investing during a crisis hides risks, then the risk of hindering development is greater. We believe in cautious investments, not unreasonable lack thereof because the latter means surrendering to the crisis, instead of seeing it as a potential opportunity to grow. That includes winning new territories for Bulgarian products on our foreign markets in partnership with local domestic producers, on whom I have always relied.
