Central and East European Refrigeration Systems Market

Published by: Frost & Sullivan

Published: Jun. 9, 2003

Table of Contents

Abstract

Higher Demand in Retail Markets Provides Greater Scope for Growth

Refrigeration systems suppliers that prioritise and target high growth sectors such as the retail markets are likely to benefit from increased sales and exponential profit margins. Since the refrigeration market is closely linked to fast developing sectors such as food and beverage and retail, it is inevitable that economic progress in these segments should lead to growth opportunities. The expendable income of eastern European customers and their post-communist desire for commercial goods have led to a boom in the retail markets. The corresponding growth in the supermarket and hypermarket chains has stimulated every product sector in the refrigeration market including the compressors and condensers that are used in display cabinets.

This new research examines the central and eastern European refrigeration system markets and provides an analysis of the developments in the retail market with a focus on supermarket chains. It provides insights into the new legislation and explanations of how eastern European countries deal with new requirements. The research outlines the competing suppliers and their position in the refrigeration market along with the major drivers and restraints that impact growth, in order to facilitate effective marketing strategies.

Superior European Union Standards Fuel Need for New Product Replacements

Accession to the European Union (EU) has increased the general standard for consumer goods, creating a demand for newer and better-quality products. This effect was most evident in the commercial and industrial segments, especially in the food industry where vendors were forced to update their production and storage facilities to comply with EU regulations. Meat producers, brewery owners, and dairy manufacturers that desired to export products to western European markets had to upgrade to EU requirements.

"Many end users, especially in the display cabinets market, prefer to have one supplier compelling other manufacturers to produce a broad product range at competitive prices," says the analyst of this research service. Since the eastern European markets are extremely price-sensitive, successfully tackling this challenge by providing new economical product ranges is expected to attract more customers. Achieving these low prices is made easier by the cheap labour available in these regions.

Dynamic Growth in the Central and Eastern European Markets

Economic and demographic forecasts indicate that the eastern European markets are likely to continue their current dynamic growth, and this is expected to positively impact the refrigeration systems market. Since the majority of sales are for the retail market and other food industry-related sectors, this increases demand in the refrigeration systems markets. People in this region can now afford to go out more, and spend time in bars and cafes, and they form a major part of the customer group for the refrigeration industry.

The markets in this region are growing at a faster rate than that of their western counterparts. Though the average prices are similar, increasing competitiveness and a limited number of investors are lowering prices in more developed countries. "The main strategies undertaken by the market leaders in response to increasing competitiveness are the introduction of cheaper products and aggressive pricing policies," notes the analyst.

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