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This project is co-financed by the European fund for Regional Development through Operational programme “ Development of the competitiveness of the Bulgarian economy” 2007 - 2013
Export strategy for
sector
“MANUFACTURE OF
WOOD AND OF
PRODUCTS OF
WOOD, EXCEPT
FURNITURE”
Bulgarian Small and Medium
Enterprises Promotion Agency
2012
Operational programme “ Development of the
competitiveness of the Bulgarian economy” 2007-2013,
Priority axis 4.2. “Promoting the internationalisation of the
Bulgarian enterprises” Project № BG161РО003 – 4.2.01-
0001 “Promotion Of The Internationalization Of The
Bulgarian Enterprises”
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
This document was developed under project № BG161РО003 – 4.2.01-0001
“PROMOTION OF THE INTERNATIONALIZATION OF THE BULGARIAN
ENTERPRISES”.
Beneficiary: Executive agency for promotion of small and medium enterprises
This document was developed with the financial support of Operational
programme “Development of the competitiveness of the Bulgarian economy” 2007-2013 co-
financed by the European fund for Regional Development. The overall responsibility of the
document’s content lies with the Executive agency for promotion of small and medium
enterprises and under no circumstances it can be accepted that this document reflects the
official statement of the European Union and the Contract authority.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
CONTENTS
INTRODUCTION .......................................................................................................................8
APPROACH TO DEVELOPING THE EXPORT STRATEGY FOR SMALL AND
MEDIUM ENTERPRASES IN SECTOR “MANUFACTURE OF WOOD AND OF
PRODUCTS OF WOOD, EXCEPT FURNITURE” .............................................................10
MAIN CONCLUSIONS OF THE ACTUAL SITUATION ANALYSIS .............................17
SWOT ANALYSIS OF SECTOR “MANUFACTURE OF WOOD AND OF WOOD
PRODUCTS, EXCEPT FURNITURE” ..................................................................................64
STRATEGIC OBJECTIVES FOR PROMOTING THE EXPORT BY SMALL AND
MEDIUM ENTERPRISES FROM SECTOR “MANUFACTURE OF WOOD AND OF
WOOD PRODUCT, EXCEPT FURNITURE” ......................................................................70
STRATEGY FOR PROMOTING THE SECTOR SMEs EXPORT ...................................73
SEGMENTATION AND SUCESSFUL POSITIONING OF THE IDENTIFIED EXPORT
MARKETS .................................................................................................................................77
ACTION PLAN FOR SECTOR “MANUFACTURING OF WOOD AND OF
PRODUCTS OF WOOD, EXCEPT FURNITURE” .............................................................84
MONITORING AND CONTROL SYSTEM .......................................................................102
BIBLIOGRAPHY AND STATISTICAL SOURCES ..........................................................106
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” LIST OF TABLES:
Table 1 Regional distribution of companies and employed in sector “Manufacture of wood, of
products of wood, except furniture” in 2009 ...............................................................................19
Table 2 Base index, 2001=100, Dynamics of the export by sectors, 2001 – 2010 .....................31
Table 3Indicators of the condition of the export of the SMEs in the manufacturing industry ....33
Table 4 Index of the turnover of the international market for the period 2001 – 2010 (to the
month of December of the corresponding year, where the base is 2005) ...................................37
Table 5 Export of Bulgaria in sector “Manufacture of wood and of products of wood, except
furniture” (million EUR) .............................................................................................................37
Table 6 Indicators of the condition of the export of the SMEs in the frame of sector
“Manufacture of wood and of products of wood, except furniture” ...........................................38
Table 7 Structure of the export of wood and articles of wood; wood charcoal – Chapter 44
under CN 2010 for the period 2001 - 2010, Main commodity groups with relative share of over
1% (in thousands EURO) ............................................................................................................40
Table 8 Dynamics of the export of wood and articles of wood from Bulgaria in total under
chapter 44 and by CN commodity groups: 4403, 4407, 4415 for the period 2001 -2010 (2001
=100) ...........................................................................................................................................42
Table 9 Dynamics of the export of commodity group 4403 worldwide for the period 2002-2010
(%, 2002=100), Source: ITC, own calculations ..........................................................................44
Table 10 Dynamics of the export of commodity group 4407 worldwide for the period 2002-
2010 (%, 2001 = 100) ..................................................................................................................44
Table 11 Dynamics of the export of commodity group 4415 worldwide for the period 2002-
2010 (%, 2001 = 100) ..................................................................................................................45
Table 12 Leading export partners for the commodity groups in sector “Manufacture of wood
and of products of wood, except furniture” for the period 2000 - 2010 .....................................47
Table 13 Leading countries importers of the Bulgarian products of group 4403 “Rough wood
materials” in total for the period 2001 -2010 (in % of the total export of Bulgaria of the
products of group 4403) ..............................................................................................................50
Table 14 Leading countries importers of the Bulgarian products of group 4403 “Rough wood
materials” in total for 2010 (in % of the total export of Bulgaria of the products of group 4403)
.....................................................................................................................................................50
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Table 15 Leading countries importers of the Bulgarian products of group 4407 “Wood,
sawned…” in total for the period 2001 -2010 (in % of the total export of Bulgaria of the
products of group 4407) ..............................................................................................................51
Table 16 Leading countries importers of the Bulgarian products of group 4407, in total for
2010 (in % of the total export of Bulgaria of the products of group 4407) ................................51
Table 17 Leading countries importers of the Bulgarian products of group 4415 “Packing cases,
boxes, crates, drums and similar packing of wood” in total for the period 2001 -2010 (in % of
the total export of Bulgaria of the products of group 4415) ........................................................52
Table 18 Leading countries importers of the Bulgarian products of group 4415, in total for
2010 (in % of the total export of Bulgaria of the products of group 4415) ................................52
Table 19 SWOT analysis .............................................................................................................64
Table 20 PESTEL analysis ..........................................................................................................67
Table 21 Action plan ...................................................................................................................84
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” LIST OF GRAPHS:
Figure 1 Labour productivity, measured as value added in BGN per one employed in SMEs of
the manufacturing industry by sectors in 2010 ...........................................................................21
Figure 2 Turnover in BGN per one employed in SMEs of the manufacturing industry by sectors
in 2010 .........................................................................................................................................22
Figure 3 Distribution of the SMEs of sector “Manufacture of wood and of products of wood,
except furniture” by activity groups ............................................................................................24
Figure 4 Indices of industrial production, turnover at the external and the domestic market of
sector “Manufacture of wood and of products of wood, except furniture” for the period 2000 –
2010 (average annual value for 2005 = 100) ...............................................................................26
Figure 5 Prognosticated values for export growth /2010-2015/ (in mln. EUR) ..........................29
Figure 6 Distribution of the companies in sector “Manufacture of wood and of products of
wood, except furniture” by size according the number of employed in 2007.............................31
Figure 7 Export in BGN per one employed in SMEs out of the total 18 studied sectors of the
manufacturing industry ...............................................................................................................35
Figure 8 Index of the turnover of the international market for the period 2001 – 2010 (to the
month of December of the corresponding year, where the permanent base is 2005 = 100) .......36
Figure 9 Dynamics of the export of wood materials and of products of wood, except furniture
(million EUR) ..............................................................................................................................38
Figure 10 Development of the export of wood and articles of wood from Bulgaria in total under
chapter 44 and by CN commodity groups: 4403, 4407, 4415 for the period 2001 -2010 (in
thousand EUR) ............................................................................................................................42
Figure 11 Export markets of the studied companies (in %) ........................................................53
Figure 12 Percent ratio of the export by number of export markets ...........................................54
Figure 13 Development of the strategy for product positioning .................................................79
Figure 14 Basic corporate strategies ...........................................................................................83
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” LIST OF ABBREVIATIONS:
ЕU European Union
BSMEPA Bulgaria Small and Medium Enterprises Promotion Agency
SME Small and Medium Enterprises
CM Council of Ministers
MEET Ministry of Economy, Energy and Tourism
NCEA National Classification of Economic Activities
NIS National Institute of Statistics
OP Operational Programme
ITC International trade centre
BCWFI Branch Chamber of Woodworking and Furniture Industry
MFA Ministry of Foreign Affairs
CIS Commonwealth of Independent States
CN Combined Nomenclature
UAE United Arab Emirates
VAT Value Added Tax
SAPARD Special Accession Programme for Agriculture & Rural Development
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” INTRODUCTION
The export strategy for sector “Manufacture of wood and of products of wood, except
furniture” has been developed under Project No BG161РО003 – 4.2.01-0001 “Promotion of the
internationalization of the Bulgarian enterprises” under Priority Axis 4 “Strengthening the
international market positions of Bulgarian economy” under Operative programme
“Competitiveness of the Bulgarian economy”, in the frame of Contract BG-161PO003-4.2.01-
001-C00001 for direct financial contribution, being the Bulgarian Small and Medium
Enterprises Promotion Agency (BSMEPA) the institutional beneficiary thereon.
The objective of the export strategy for sector “Manufacture of wood and of products of
wood, except furniture” is to support the Bulgarian micro, small and medium-size enterprises
within the sector, in order to enhance their competitiveness, internationalization level and initial
entering or expansion of the market share of Bulgarian products, in particular of those with
higher value added.
The Bulgarian state, represented by BSMEPA, MEET and other government bodies, has
recognized the SME sector to be extremely sensible and at the same time as having decisive
importance in the economic field, deserving special attention. The diversity in the development
of the various industrial sectors, where the SME development has its place, as well as national
priorities, related to promoting the country’s export, require drafting of export strategies for
certain sectors, being the “Manufacture of wood and of products of wood, except furniture”
sector one of them. Focusing the support and giving of precise reference points for State
intervention through its institutions, as well as offering development options for the rest of the
participants in the process will strengthen in positive aspect the plan-based principle in State
activities and as a result will improve the sectors functioning. The successful realization of the
Expert strategy is expected to result in the improvement when entering international markets
and the active expansion and strengthening of the market positions of the Bulgarian small and
medium enterprises, manufacturing wood and of products of wood, except furniture.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” At the strategy development, general consideration has been made of the results and the
conclusions of the carried out studies of the existing strategic and legal acts. The “Methodology
of strategic planning”, drafted by the Administrative reform council at the Council of Ministers
of the Republic of Bulgaria has also been taken into account.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
APPROACH TO DEVELOPING THE EXPORT STRATEGY FOR
SMALL AND MEDIUM ENTERPRASES IN SECTOR “MANUFACTURE
OF WOOD AND OF PRODUCTS OF WOOD, EXCEPT FURNITURE”
The export strategy is a strategic document, setting short-term objectives and priorities
within the SMEs export development. It has been drafted on the basis of the strategic planning
approach, which adroit use has the following advantages:
Ensures good comprehension among the stakeholders for the trends and what could
bring the future;
Creates general vision and consensus among the stakeholders, coordinating the
various initiatives under the chosen objectives;
Identifies the projects and actions undertaken or planned;
Strengthens the partnership among the management bodies, the business and others
for solving complex problems.
When developing such a strategic document it is extremely important to precisely
formulate the “owner” of the strategy, i.e. the institution or institutions responsible for the
overall implementation of the strategic documents, as well as the concrete phases of the
strategic planning.
Most commonly the phases of elaboration of the strategic document are:
Assignment;
Preparation;
Development;
Coordination;
Adoption;
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Implementation;
Evaluation;
Update.
Each of these phases contains different activities, some of which, as assignment,
preparation, elaboration, coordination, adoption and update at a later stage, will be part of the
project, implemented by the contract, mentioned at the beginning. Consequently, the main
“owner” of the export strategy is the Bulgarian Small and Medium Enterprise Promotion
Agency. This formal logic does not contradict to the fact that as stakeholders in the different
phases are included significant number of institutions, businesses and even the country’s
population.
Strategic planning tools
The strategic planning process includes the following steps:
Identification of the stakeholders;
Analysis of the environment;
SWOT analysis;
PESTEL analysis;
Vision;
Definition of the targets;
Selection of alternative – development strategy;
Action plan;
Monitoring system.
Each of these steps has certain peculiarities, mainly:
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Identification of the stakeholders. A stakeholder is each person or group, that requires
attention, that can influence certain decision, may contribute with resources or may be affected
by given decision. The implication of the stakeholders at an earlier stage of the strategic
document development may lead to better expressed consensus on the targets and bigger
readiness to support the decision. The stakeholders to the Export strategy may include different
people and organizations: companies, government bodies, manufacturer associations, certain
businesses, the corresponding products consumers, non-governmental organizations and
experts.
Analysis of the environment. The analysis of the environment (the conclusions on
which is based the SWOT analysis) permits the definition of targets and priorities that are
going to synchronize the efforts and to be inline with the time and environment.
The analysis describes the present situation of the SMEs in the sector and the export
process, establishes the reasons that provoke problems in the development, and sets the future
development trends.
SWOT analysis. The SWOT analysis gives the opportunity to identify the main
internal factors, differentiated as “strengths and weaknesses” and the external factors –
“opportunities and threats”, helps formulating the strategic objectives, priorities and measures.
The use of SWOT protects from setting unreachable objectives and priorities for the export
development of the SMEs of sector “Manufacture of wood and of wood products except
furniture” within the Strategy period.
The use of SWOT analysis when developing the Export strategy has certain specifics, as
the “owner” of the strategy is the BSMEPA, but the analysis is focused on the export process of
the SMEs in this exact sector and not on the industry itself.
PESTEL analysis. There are number of factors and “variables” that have a direct or
indirect influence on the business environment in our country as well as on the whole
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” manufacturing industry state. Tax rates, changes in law, trade barriers and administrative
requirements, political and social trends represent macro factors having perceivable effect on
the enterprise operation.
PESTEL analysis is focused on analyzing the factors and tendencies on macro level
influencing the development of Bulgarian manufacturing industry, SME and the “Medical,
precise and optical equipment and instruments” sector in particular.
The use of this analysis shall present key conclusions for the positioning and planning of
SME development in this sector. Vision: Defining the vision is extremely important for the
future development of the export of the Furniture manufacturing sector SMEs, as it
demonstrates the view of the institutions and the business towards the future. The vision seeks
answer of one basic question – How do the stakeholders and the main participants in the
process want the sector export to look at the end of the period, covered by the strategy?
Vision: Defining the vision is extremely important for the future development of the
export of the SMEs of sector “Manufacture of wood and of wood products except furniture”, as
it demonstrates the view of the institutions and the business towards the future. The vision
seeks answer of one basic question – How do the stakeholders and the main participants in the
process want the sector export to look at the end of the period, covered by the strategy?
Definition of the targets. The strategic planning is focused on the issues of critical
importance, the opportunities and the problems, faced by the SMEs export of sector
“Manufacture of wood and of wood products except furniture”. It helps to outline the really
important decisions from those decisions with temporary impact.
The definition of the targets by making hierarchical tree of goals is a working instrument,
giving the opportunity to work out in detail as the most common general objectives, as well as
the most specific ones.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Reaching the level of the specific targets permits finding the answer of the questions
“who”, “what” and “when”, as to guarantee the achievement of the defined general goals.
Selection of alternative – development strategy. After the objectives definition, the
paths for their achievement are sought. Practice shows that this may be done through different
ways, representing different alternatives for development and achievement of the set objectives.
At this stage of the strategic planning the various alternatives are evaluated by different point of
views and criteria, and as a result one alternative is chosen, that is to become a development
strategy.
Action plan. The chosen strategy is to be supplied with certain activities and measures,
bound by deadlines, people in charge, executors and funding. The action plan and the measures
provided therein represent the transformation of this strategic instrument into our everyday
work and the realization of policy of supporting the “Manufacture of wood and of products of
wood, except furniture” sector SMEs export.
Monitoring system. The last stage of the strategic planning process is the monitoring and
evaluation of the progress of implementing the general and specific objectives, laid down in the
export strategy and in the action plan. Monitoring is important as it gives the possibility to
undertake corrective actions, if the progress is unsatisfactory or if the conditions are changed.
Reporting the progress in achieving the general objectives in front of the society and the
business is also important, as to grant them the possibility to evaluate the work of the
corresponding institutions and stakeholders for the strategy realization. We must note that very
often impacts may not be visible or obvious, that makes their measurability difficult. Moreover,
impact may often result in cumulative effect and it may additionally complicate the analysis.
This gives particular importance of the monitoring, which is closely related with all stages of
implementation of the Export strategy – preliminary (ex ante), current (parallel to realization)
or posterior (ex post) evaluation.
In order to monitor the export strategy implementation and to evaluate the results
achieved in terms of the set goals, it is necessary to use a set of indicators related to the
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” implementation of the strategic document, that are to be determined preliminary or early
enough, as to use the data obtained thereof. In most of the cases these will be targets, which in
aggregate will correspond to the objectives of the strategic document.
The monitoring provides the feedback, helping to render account about the success or
failure of the planning document.
In order to perform the monitoring process is it necessary to define:
Monitoring indicators (what is to be monitored);
Periodicity of the monitoring and the evaluation (when are going to be prepared
the corresponding reports);
Responsibilities, related to the monitoring and evaluation implementation (who
and for what is going to be responsible), and competences on taking decision on changes
(update of the strategic document).
Information sources
When developing the export strategy the following basic information sources have been
used:
National Institute of Statistics;
Information, given by BSMEPA;
Information from the Ministry of Economy, Energy and Tourism;
Eurostat;
World Trade Centre;
Information, published in relation to the celebration of international forums and meetings;
Official electronic information sources;
Information, published by the Branch chamber of wood-working and furniture industry
Information by the Bulgarian Chamber of Commerce and the Bulgarian Chamber of
Commerce and Industry, as well as their regional divisions;
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Information from sociological survey, carried out within the period October 31st –
November 28th, 2011 together with the senior management of 23 SMEs, working in the
sector, as well as of the carried out discussions in focus groups.
Structure of the Export strategy for sector “Manufacture of wood and of products of
wood, except furniture”
At determining the structure of the Export strategy for sector “Manufacture of wood and
of products of wood, except furniture” has been considered the use of the strategic planning
approach, setting the general parameters of the strategic document. At the same time has been
conducted a survey of the structure of other institutional strategic documents, using for
evaluation the following criteria:
– Is there a possibility for comparatively easy acquaintance with the document through a
comprehensive and logic structuring of the various parts;
– Is the content represented in an attractive and easy to understand way, accessible for
non-professionals;
– Is it possible to grant the information thematically, i.e. is the material structured in a
way to allow in-depth introduction into the issues and analysis only if the reader is
willing to.
Some of the studied strategies met the so selected criteria, where there was a clear distinction
between tow separate parts, in particular:
1. Main document, where according to the described above logic of the strategic plan tools
contains definition of the various sections.
2. Annexes, containing the complete text of the prepared analysis, including the
introduced in the main material conclusions.
This approach was preferred also when structuring the Export strategy for sector
“Manufacture of wood and of products of wood, except furniture”.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” MAIN CONCLUSIONS OF THE ACTUAL SITUATION ANALYSIS
This part contains the conclusions of the various analysis, included in the “Analysis of
the environment”, being one of the main steps in the strategic planning technology. In addition
to this strategic document is given the complete text of the facts, as well as of the made
analysis, on the basis of which made conclusions have been formulated. The conclusions and
the analysis themselves are structured in 5 parts, as follows:
CONDITION AND DEVELOPMENT OF THE SECTOR IN
BULGARIA
EXPORT ORIENTATION OF THE SECTOR
PRODUCTS WITH EXPORT ADVANTAGES AND POTENTIAL
COMPETITIVENESS OF THE EXPORT OF GOODS TO
FOREIGN MARKETS
BARRIERS TO THE INTERNATIONALIZATION OF SMALL
AND MEDIUM SIZED ENTERPRISES AND MEASURES AND
PERSPECTIVES FOR EXPORT PROMOTION AND
DEVELOPMENT
CONDITION AND DEVELOPMENT OF THE SECTOR IN BULGARIA
Small and medium enterprises are the backbone of European economy, its priority and
long-term commitment, being also an important social factor for the development of common
economic space. The situation in Bulgaria is similar and requires long-term vision and
particular efforts supporting the non-financial sector and enterprises, ensuring employment to
more than two thirds of the population.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Especially vulnerable of the abrupt changes in economic cycles, SMEs are following
the upsurges and falls of the global financial and economic path. Among the basic principles of
the European Community – principles Bulgaria has always underlined its aspiration to follow –
is the commitment to ensure stability and protection namely of such priorietary economic
structures, combining important economic and social roles. This priority of National and
European performers, lawmakers and consultative bodies require far-sighted strategic and
export interference in the last three years, as a result of the global and economic crisis.
The growth in the industrial production of the EU Member States marked sensible fall;
the mutual export, as well as export to third countries, has also suffered negative development.
And in Bulgaria, a country, still lagging behind the cohesion indicators and possibilities for
long-term industrial investment, theses trends were especially forced by the role of the
decreased industrial export in the period 2008 – 2010. A motor for the national GDP forming,
the export potential of over 99% of the companies in the non-financial sector, requires a
package of incentives for reaching the generally accepted principles of sustainable economic
development in the European economic space. Similar national and branch policies, through
concrete objectives and systematized measures are to be guided by the indicators for strong and
weak sides of our manufacturing industry, but at the same time, by the in-depth analysis of the
possibilities and upcoming trends on international markets, comparisons between present and
future competitors, usage and long-term application of recognized good practices.
What is peculiar for our manufacturing industry, in particular for sector “Manufacture
of wood and of products of wood, except furniture”, according the statistics of NIS and
Eurostat, is that it is lagging behind in the scientific and technology field and in the field of
modernization, leading to characteristically low share of the added value.
The indicated below findings represent a concentrated expression of the conclusions,
based on the detailed analysis and sociological surveys made with representatives of the SME
of sector “Manufacture of wood and of products of wood, except furniture” in the process of
drafting the present strategy. The objective is to emphasize the place of the SME in the sector
and their export possibilities.
The sector “Manufacture of wood and of products of wood, except furniture” has
clearly expressed possibility to strengthen its export positions, but at the same time it should
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” not be ignored that the fight for conquering market shares depends on the personal
imitativeness of the Sales executives and managers, who usually are long-term experts in the
field they are working in, but are suffering serious financial difficulties to organize business
trips, participations in international meetings, fairs, symposia, etc.
The manufacture consists in manufacture of profiles for windows and doors, veneer
sheets and wood-based panels; assembled parquet floors; builders’ carpentry and joinery;
wooden containers; other products of wood; manufacture of articles of cork, straw and plaiting
materials, etc.
The sector for wood manufacturing comprises about 1.5% of the industrial manufacture
in the country and is creating also approximately 1.5% of the added value in the industry. The
participation of the sector in the external trade of the country is amounting to approximately
1.3% of the total export and less than 1% of the total import. The revival of the manufacture in
the sector will impact the export dynamics that grew in 2010 by 36.5%.
There is clearly expressed uneven distribution of enterprises and people employed by
regions. There are 950 companies operating in the sector, small, medium and large sized, where
around 40% of them are situated on the territory of the South-western and Southern Central
planning region. Lowest is the concentration of companies in the North-eastern region.
Table 1 Regional distribution of companies and employed in sector “Manufacture of wood,
of products of wood, except furniture” in 2009
Employed
in the
sector
(prs)
% of employed in
the
manufacturing
industry
% of
employed
in the
sector
Companies
in the
sector
(uts)
% of
companies
in the
sector
North-western region 2679 4,4% 16,0% 252 12,2%
Northern central region 2265 12,7% 13,5% 215 10,4%
North-eastern region 1482 2,6% 8,9% 182 8,8%
South-eastern region 2110 2,6% 12,6% 230 11,1%
Southern central region 4738 3,5% 28,3% 674 32,4%
South-western region 3442 2,2% 20,6% 520 25,1% Source Eurostat
The level of salaries in the sector is around the average for the country. The average
monthly remuneration is estimated at 480 BGN and ensures employment of approximately 16.7
thousand persons (3.5% of the employed in the manufacturing industry).
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Among the companies, operating in the field of wood industry could be distinguished
the following: State Hunting Area “Borovo” SF, “Tundja” SF, State Hunting Area “Alabak”
SF, State Hunting Area “Kotel” SF, factory “Mediket” PLC, and among those dealing with
woodworking – “Lessoplast” PLC, “Rodopi” PLC, “Kronoshpan BG” SPLC, “Woodworking
VT” PLC, “Technowood” SPLC.
The index of industrial production and that of the turnover in the sector in 2010 have
improved respectively by 12.6 and 7.1 points. At the same time there is change in the producer
prices in the sector (-5.6 percentage point relative to 2009).
At the end of 2010 the number of SME in the sector was 1962 SME, where the
reduction relative to 2009 is approximately 7%, following the general trend of decreasing the
number of enterprises, operating in the industry field and in particular in the manufacturing
industry in Bulgaria. In 2010 in terms of number of small and medium size enterprises in sector
“Manufacture of wood and of products of wood, except furniture” holds fifth place in the
manufacturing industry after sector “Manufacture of furniture”. The relative share of the SMEs
in the sector in comparison to those in the industry is 0,63%, and relative to those of the
manufacturing industry is approximately 6.5%.
The realized turnover by the SMEs in sector “Manufacturing of wood and of products of
wood, except furniture” turnover of approximately 473 million BGN ranks it on 11th place
among the observed 18 sectors of the manufacturing industry in the country, in terms of this
indicator. It represents 0,38% of the turnover realized in 2010 within the industrial sector of
Bulgaria and approximately 2,7% of the turnover of the manufacturing industry. The increase
rate of the turnover in the sector in 2010 in relation to 2009 of 10% significantly outruns the
average increase rate of the turnover in 2010 in relation to 2009 for the SMEs in the
manufacturing industry, accounting for 1, 78%.
The disadvantageous economic conditions have pushed the sector SMEs managers to
optimize their resources and to increase their effectiveness, and as a result the turnover reached
in 2010 exceeds by 41 million the values of 2009, independently of the essential work force
contraction.
As a result of the above fact, the labour productivity of the sector SMEs, measured as a
ratio of the created value added and the number of employed, has increased by approximately
8,5% in 2010 in relation to 2009, accounting for 8 173 BGN/employed. However, the sector is
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” situated in one of the last places among the studied total of 18 sectors of the manufacturing
industry in terms of the indicator “value added per one employee”, as well as by the turnover,
realized per one employee.
Figure 1 Labour productivity, measured as value added in BGN per one employed in SMEs
of the manufacturing industry by sectors in 2010
(source: NIS, own calculations)
*Translation:
21 Manufacture of basic pharmaceutical products and pharmaceutical preparations
26 Manufacture of computer, electronic and optical products
20 Manufacture of chemical products
28 Manufacture of machinery and equipment n.e.c.
18 Printing and reproduction of recorded media
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” 23 Manufacture of other non-metallic mineral products
27 Manufacture of electrical equipment
30 Manufacture of other transport equipment
22 Manufacture of rubber and plastic products
25 Manufacture of fabricated metal products, except machinery and equipment
10 Manufacture of food products
17 Manufacture of paper, paperboards and of paper and paperboard products
Figure 2 Turnover in BGN per one employed in SMEs of the manufacturing industry by
sectors in 2010
(source: NIS, own calculations)
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” *Translation:
20 Manufacture of chemical products
26 Manufacture of computer, electronic and optical products
10 Manufacture of food products
21 Manufacture of basic pharmaceutical products and pharmaceutical preparations
22 Manufacture of rubber and plastic products
27 Manufacture of electrical equipment
30 Manufacture of other transport equipment
23 Manufacture of other non-metallic mineral products
17 Manufacture of paper and paper products
11 Manufacture of beverages
28 Manufacture of machinery and equipment n.e.c.
18 Printing and reproduction of recorded media
25 Manufacture of fabricated metal products, except machinery and equipment
13 Manufacture of other transport equipment
16 Manufacture of wood and of products of wood and cork, except furniture; manufacture of
articles of straw and plaiting materials
31 Manufacture of furniture
14 Manufacture of wearing apparel
15 Manufacture of leather and related products
The total added value created in the sector in 2010 is accounting approximately to 109
million BGN and it ranks it immediately after sector “Manufacture of chemical products”. This
added value forms about 2,61% of the added value in the SMEs of the manufacturing industry
and 0,56% of the added value in the industry.
In 2010 in sector “Manufacture of wood and of products of wood, except furniture” is
witnessed growth trend of the total volume of added value in comparison to 2009, accounting
for 2%,. At the same time, there is a decrease trend of the added value in SMEs in the
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” manufacturing industry of almost 1 %, that together with the decrease in employment, results in
the increase the value of the “labour productivity” indicator of up to 8,5% on annual basis
The contribution of the SMEs of sector “Manufacture of wood and of products of wood,
except furniture” in the field of employment, turnover and value added of the SMEs in the
manufacturing industry gives grounds to determine the sector as perspective and having export
potential.
The relatively low values of labour productivity are due to greater extent to the still
existing strong dependence on the traditionally high employment rate, which is an important
social factor in regions of concentration of sector SMEs, as well as to the low level of
processing of the raw material, i.e. there is lesser added value.
The dynamics of the manufactured production and the turnover of the companies,
manufacturing wood and products of wood, except furniture, measured in terms of the
productivity and turnover index show the existence of ongoing positive trends in the sector for
the period 2001 – 2010, but at the same time, there is strong dependence on the development of
other industrial sectors, at first place – the construction. The larger export orientation will
ensure to the sector a possibility of sustainable development and lower conjuncture dependence
on the domestic market.
Figure 3 shows the inter-sector distribution of the SMEs:
Figure 3 Distribution of the SMEs of sector “Manufacture of wood and of products of wood,
except furniture” by activity groups
(source: NSI, own calculations)
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” *16.1 Sawmilling and planing of wood; impregnation of wood (39% - 769 companies)
16.2 Manufacture of products of wood, cork, straw and plaiting materials (61% - 1193
companies)
The vast majority of the sector SMEs (61%) are employed in group according to the
CEA - 2008, 16.2 “Manufacture of products of wood, cork, straw and plaiting materials”, that
includes manufacture of veneer sheets and wood-based panels; of assembled parquet floors; of
builders’ carpentry and joinery; of wooden containers; of other products of wood; of articles of
cork, straw and plaiting materials.
In group 16.1. “Sawmilling and planing of wood; impregnation of wood” are engaged a
total of 39% of the SME. It includes: sawing, planing and machining of wood; slicing, peeling
or chipping logs; manufacture of wooden railway sleepers; manufacture of unassembled
wooden flooring; manufacture of wood wool, wood flour, chips, particles; drying of wood;
impregnation or chemical treatment of wood with preservatives or other materials; manufacture
of split and sharpened piles and pallets.
Out of the two main groups in the sector, group 16.1. “Sawmilling and planing of wood;
impregnation of wood” marks an increase in the employed accounting for approximately 2,5%,
and group 16.2 “Manufacture of products of wood, cork, straw and plaiting materials” – a
decrease of 11% in 2010 relative to 2009.
More than 60% of the turnover in the sector is realized by group 16.2 “Manufacture of
products of wood, cork, straw and plaiting materials”. It marks turnover growth of 3,5% in
2010 in comparison to 2009, while the growth in group 16.1. “Sawmilling and planing of
wood; impregnation of wood” it is significantly higher – over 20%.
The labour productivity (added value per one employed) in both groups of sector
“Manufacture of wood and of products of wood, except furniture” marks growth in 2010
relative to 2009, whereas the growth is more significant in group 16.02 “Manufacture of
products of wood” – 10,5%. In the case of group 16.1. “Sawmilling and planing of wood;
impregnation of wood” there is an increase of 6,5%. In the case of the first group the main
reason for the significant increase of the created value added is the increase of this indicator in
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” comparison to the previous year, and in the case of the second group – the reason is the
significant decrease in employment.
The analysis of the index of industrial production within the sector shows fast growth
rates for the period after 2001, peaking in 2006. The production and turnover growth rates for
the sector, especially those of the internal market, follow the general trends in the industry and
the manufacturing industry, but differ by its accelerated development within the period,
characteristic with the active construction period in Bulgaria and the huge amount of
investments in this sector. After 2007 all indices reflect the influence of the world economic
crisis, returning to levels of 2004. The turnover index on the world market follows more
gradual development and for the whole period the values are under the average for 2005. After
2009 this index shows ascending trend.
Figure 4 Indices of industrial production, turnover at the external and the domestic market
of sector “Manufacture of wood and of products of wood, except furniture” for the period
2000 – 2010 (average annual value for 2005 = 100)
(source: NIS, own calculations)
*Index of industrial production/Index of turnover on the international market/Index
of turnover on the domestic market/Index of industrial production in the industry as a
whole/Index of industrial production in the manufacturing industry
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” The unfavourable economic conditions have pushed the sector SMEs managers to
optimize their resources and to increase their effectiveness, and as a result the turnover reached
in 2010 exceeds by 41 million the values of 2009, independently of the essential work force
contraction.
The contribution of the SMEs of sector “Manufacture of wood and of products of wood,
except furniture” to the employment, turnover and value added of the SMEs in the
manufacturing industry gives grounds to suppose, that, if in a more favourable macroeconomic
environment it could show characteristics of a perspective, adaptive, fast-reacting sector with
significant export potential that could play a vital role in the future economic development of
the country.
In sector “Manufacture of wood and of products of wood, except furniture” in the frame
of a sociological survey have been studied a total of 23 enterprises in 18 different locations in
the country, including 5 villages. There are situated in 12 districts. The highest number of
companies is from the region of Pazardzhik (4) and Sofia-city (3); in six districts have been
studied per 2 business units and in the rest – per 1.
Situation analysis
Main factors, representing a barrier to the export of the SME of sector “Manufacture of
machinery, equipment and home appliances” are the following:
Deteriorated policy of crediting;
Insufficient financial resources;
Seriously limited and insufficient choice of funding sources;
Risk of insolvency due to the specificity of the SME structure;
Incapability for entering into the field of highly industrialized export.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Analysis of the Bulgarian export of products, marking the highest values within the studied
period.
Among all studied products there are such, being absolute leaders by indicators both
concerning absolute value and growth for the period. There are products with relatively
constant levels of demand and such, having more specific demand.
In order to evaluate the possibilities of the present strategy to help them develop even
more, identical indicators for monitoring and evaluation of the set measures will be undertaken,
as there are different possible development scenario and the market situation at the moment is
unfavourable. From the time perspective the main task and objective of the present strategy will
be to introduce strategic planning into the sector. This is first and foremost related to
overcoming falls in export and achieving sustainable growth, as each harsh reduction in the
export value may result fatal for one small or medium-size Bulgarian enterprise.
An evaluation of the present strategy efficiency may give a more complete and deeper
analysis of the reached results about the export values. Without considering the absolute values,
it is important to find the trend development and to analyse the export development line. The
introduction of the strategy is expected to promote the export and to lead it to sustainable
growth, subjected to stable development rates. Another key instrument is to build systematic
monitoring and to perform analysis of different product segments.
Analysis of the Bulgarian export of products, marking the lowest values within the studied
period.
If in the case of the products having stable export positions, marking the highest export
values the objective is the achieve sustainable development, in the case of the products with
relatively lower export values the priority should be to push it out to higher export levels. It
could be realized through aggressive policy on behalf of the exporting country in relation to the
price level or preferential conditions. The export value is determining to a higher extent if a
trade policy is effective or not. In the case the aim is to break or enter into a foreign market by
all marketing tools. This may include discounts for larger orders, preferential prices for regular
and loyal clients, as well as other bonuses.
Occupying new niches by the SME in the sector, willing to establish their position into
the foreign market is related to finding ways to produce and export channels. One of the
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” possibilities before the small and medium-size business is equipment hiring or licensing and
cluster creation, specialized in producing the good. The set strategic goals, measures and the
following of certain action plan to promote the economic activity production export may be
done mostly if performing regular market monitorings and publishing specialized bulletins, as
well as information from the NSI for the development of the sector and alternative market
studies, carried out by business or non-profit organizations. Otherwise, the established
indicators would have representative role and could easily be approved by various market
stakeholders.
The given 5 graph shows the prognosticated values for the development of various
market segments for the period 2010 – 2015.
Figure 5 Prognosticated values for export growth /2010-2015/ (in mln. EUR)
0.0 50.0 100.
0
150.
0
200.
0
250.
0
Други изделия от дървен
материал, корк, слама и
материали за сплитане
Разкрояване, рендосване и
импрегниране на дървен
материал
Опаковки от дървен материал
Сглобени паркетни плочи
Фурнир и дървени плочи
2015
2010
Source: Own calculations
*Translation:
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” manufacture of veneer sheets and wood-based panels
assembled parquet floors
wood packaging
Sawmilling and planing of wood; impregnation of wood
other products of wood; of articles of cork, straw and plaiting materials
As it may be seen on the graph enclosed the products of “veneer sheets and wood-based
panels” undergo the most dynamic development and have the biggest export potential, second
come “other products of wood; of articles of cork, straw and plaiting materials”; on third place
are “assembles parquet floors”; fifth – not far of the opportunities for strong export
development are “wood packaging”.
In other words, the sector companies must have clear and precise vision regarding the
extent to which they could apply the strategic objectives of the present document and what
expenditure levels they need to realize export. Therefore it should be added that a number of
methods could be applied to optimize the financial structure of given company with view to
reducing costs and increasing the relative income share.
In the case of companies from this economic activity – “Manufacture of wood and of
products of wood, except furniture”, it is necessary to act in both directions or rather to reduce
the expenses for an activity, redirecting them to investment in developing the export activity.
This restructuring is related to costs for drafting prognosis, strategic plans, projects and mainly
vision for introducing the product into the foreign market.
EXPORT ORIENTATION OF THE SECTOR
As in the rest of the European countries, in Bulgaria the sector “Manufacture of wood
and of products of wood, except furniture” is sector of the small and medium-size enterprises –
more than 99% of all companies are small and medium-size enterprises, where approximately
78% are micro enterprises.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Figure 6 Distribution of the companies in sector “Manufacture of wood and of products of
wood, except furniture” by size according the number of employed in 2007
Sources: NIS
According to Eurostat data the number of SMEs in the manufacturing industry of
Bulgaria amount to 32 177 in 2009. The number of SMEs out of the determined as priority 18
sectors for same year is 25 942, representing 81% of the manufacturing industry. Consequently,
as a conclusion of the analysis of the SMEs we could say that these 18 export-orientated sectors
could be accepted as representative for the SMEs from the whole manufacturing industry
sector.
Table 2 Base index, 2001=100, Dynamics of the export by sectors, 2001 – 2010
Sector number 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Manufacture of food products 100 140,5 126,9 163,0 186,1 201,4 222,7 369,3 373,2 458,4
Manufacture of beverages 100 96,5 94,1 93,5 108,3 116,3 144,7 139,6 104,7 120,2
Manufacture of textile and textile
products, except wearing apparel
100 120,3 145,0 171,0 173,3 206,2 236,2 217,1 164,8 180,7
Manufacture of wearing apparel,
incl. leather clothes, tanning and
dressing of leather
100 110,5 126,0 131,0 129,7 136,3 136,4 124,6 106,7 112,6
Manufacture of rubber and
plastics products
100 112,9 126,7 149,1 187,9 237,3 287,8 271,4 235,7 321,6
Manufacture of chemical and
pharmaceutical products
100 89,2 93,4 96,8 131,2 138,6 186,3 224,3 168,2 224,9
Manufacture of non-metallic and
mineral products
100 102,5 113,5 116,4 129,3 198,9 237,4 244,9 217,5 266,3
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Sector number 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Manufacture of machinery,
equipment and household
appliances
100 109,6 114,3 135,4 164,8 198,6 275,8 311,6 219,6 275,1
Manufacture of medical, precise
and optical apparatus and
instruments
100 167,0 224,5 220,2 300,0 443,5 524,9 576,9 573,2 700,2
Manufacture of office equipment
and computers
100 148,8 206,3 256,5 319,6 398,2 479,5 571,3 481,1 593,7
Manufacture of electric
machinery and apparatus
100 113,1 151,6 166,4 195,2 250,3 321,1 368,9 369,2 493,7
Manufacture of wood and
products of wood, except
furniture
100 114,5 127,7 149,8 148,7 161,9 198,1 142,5 135,1 186,8
Manufacture of pulp, paper and
paperboard
100 107,0 141,5 163,1 166,1 158,5 196,7 219,7 111,4 252,0
Manufacture of furniture 100 144,1 187,0 227,0 256,1 274,5 316,1 296,7 238,8 274,0
Publishing, printing and
reproduction
100 150,7 242,1 183,8 222,9 272,7 527,5 617,1 425,9 354,4
Manufacture of motor vehicles,
except cars
100 145,2 121,3 147,8 271,5 349,5 526,0 730,1 886,8 1
363,7
Manufacture of metal products,
except machinery and equipment
100 96,6 102,5 142,3 161,9 238,8 307,2 286,8 210,6 271,4
Manufacture of radio, television
and telecommunication
equipment
100 173,9 191,3 208,7 530,2 576,6 472,2 591,8 549,3 520,1
Total for the 18 sectors 100 111,5 123,4 138,4 158,5 183,7 215,8 235,0 198,9 245,1
Total export from BG 100 106,6 116,8 140,0 165,3 210,8 237,6 267,9 207,5 272,1
Source: International trade centre
The table 2 data analysis shows that out of the export-orientated sectors from the
manufacturing industry sector “Manufacture of wood and of products of wood, except
furniture” is registering the biggest growth (over 2 times) of the export in 2010 relative to 2009.
This demonstrates trade of recovering the export positions of the sector and is indicating the
existence of process of overcoming of the effects of the crisis.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Table 3Indicators of the condition of the export of the SMEs in the manufacturing industry
Groups of companies Export share in
the total export of
SMEs in the
manufacturing
industry (%)
Change
in export
2010/2009
Export volume
per 1 employed
(BGN)
2009 2010 2009 2010
Manufacture of food products 4,32 3,00 92,43 13867 13428
Manufacture of beverages 0,34 0,16 61,35 9933 6325
Manufacture of textiles and textile
products, except wearing apparel
0,57 0,34 79,33 18701 16139
Manufacture of wearing apparel 6,18 4,36 93,83 16896 17649
Manufacture of leather, manufacture of
footwear and other related products
1,15 0,96 110,87 20217 23182
Manufacture of wood and of products of
wood and cork, except furniture;
manufacture of articles of straw and
plaiting materials
0,50 0,27 72,51 8030 6198
Manufacture of paper, paperboard and
products thereof
0,27 0,13 64,38 8282 6233
Printing and reproduction of recorded
media
0,16 0,10 85,97 4040 3449
Manufacture of chemicals and chemical
products
1,26 0,70 74,07 32860 25165
Manufacture of basic pharmaceutical
products and pharmaceutical
preparations
0,10 0,07 88,16 13785 11410
Manufacture of rubber and plastics
products
1,43 1,12 104,29 15586 17860
Manufacture of other non-metallic
mineral products
0,41 0,29 94,52 4928 5768
Manufacture of fabricated metal products,
except machinery and equipment
1,36 1,09 106,77 7667 9490
Manufacture of computer and
communication equipment, electronic and
optical products
1,05 0,52 66,50 43944 30410
Manufacture of radio, television and
telecommunication equipment and
apparatus
0,08 0,05 92,24 18173 14242
Manufacture of electrical equipment 1,00 0,74 98,08 23978 27133
Manufacture of machinery and
equipment, with general and special
purpose
0,96 0,81 112,23 13024 15408
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Manufacture of motor vehicles, except
cars
0,27 0,18 88,12 26492 25793
Manufacture of furniture 0,49 0,42 114,73 5187 6764
Source: NIS, own calculations
The analysis of the date from table 3 gives ground to make the following conclusion:
In contrast to sector “Manufacture of wood and of products of wood, except furniture”
as a whole, the export of SMEs therein is reducing its export in 2010 relative to 2009,
proving the necessity of a longer period for overcoming the effects of the crisis.
The SMEs of the sector are going down to 10th
place in 2009 and are holding hardly 13th
place (after “Manufacture of products other non-metallic mineral products) among the
studied sectors in terms of export share in the total export of the country in 2010.
There is an unfavourable trend of specialization of the sector SMEs in satisfying the
needs of the domestic markets. Although small in number, in the last years several large
companies from the sector have attracted significant foreign investments and have
created significant export capacity, thanks of their foreign partners.
The indicator “volume of the export per 1 employed” in 2010 going down by 23% in
relation to 2009.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Figure 7 Export in BGN per one employed in SMEs out of the total 18 studied sectors of the
manufacturing industry
(Source: NIS, own calculations)
*26 Manufacture of computer, electronic and optical products
27 Manufacture of electrical equipment
30 Manufacture of other transport equipment
20 Manufacture of chemical products
15 Manufacture of leather and related products
22 Manufacture of rubber and plastic products
14 Manufacture of wearing apparel
13 Manufacture of other transport equipment
28 Manufacture of machinery and equipment n.e.c.
10 Manufacture of food
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” 21 Manufacture of pharmaceutical products and pharmaceutical preparations
25 Manufacture of fabricated metal products, except machinery and equipment
31 Manufacture of furniture
11 Manufacture of beverages
17 Manufacture of paper and paper products
16 Manufacture of wood and of products of wood and cork, except furniture; manufacture of
articles of straw and plaiting materials
23 Manufacture of other non-metallic mineral products
18 Printing and reproduction of recorded media
Figure 8 Index of the turnover of the international market for the period 2001 – 2010 (to the
month of December of the corresponding year, where the permanent base is 2005 = 100)
Source: NIS
*Industry – general/Manufacturing industry/C 16 Manufacture of wood and of products of
wood, except furniture
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Table 4 Index of the turnover of the international market for the period 2001 – 2010 (to the
month of December of the corresponding year, where the base is 2005)
Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Industry -
general 64,2 55,0 73,5 69,3 91,5 112,2 120,6 139,3 97,0 110,3 176,9
Processin
g industry 60,4 53,7 73,0 68,5 91,9 110,1 119,8 140,0 98,3 113,8 180,0
Manufact
ure of
wood and
of
products
of wood,
except
furniture
73.5 38.7 62.3 75.6 86.4 99.5 86.4 94.1 74.2 77.1 90.7
Source: NIS
Sales incomes on the international market in the manufacture of wood and of products
of wood, except furniture have grown after 2001, following more slowly the general
development of the index of the industrial sector and the manufacturing industry. In 2010 the
values of the index for the sector almost reach their pre-crisis levels of 2005, while the indices
for the industrial sector and the manufacturing industry reach their highest values for the whole
period. This may be followed in the next tables and graphs.
Table 5 Export of Bulgaria in sector “Manufacture of wood and of products of wood,
except furniture” (million EUR)
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Export of Bulgaria
5253,1 5714,2 6062,8 6668,2 7984,9 9466,4 12011,9 13511,9 15204,0 11699,2 15561,2
Total for the sector
233,3 278,1 294,9 334,4 346,4 364,7 388 293,7 257,2 228,3 308,3
Share of the sector of the total of Bulgaria
4,4 4,9 4,9 5,0 4,3 3,9 3,2 2,2 1,7 2,0 2,0
Base index (base 2000)
100.0 474,6 503,2 570,6 591,1 622,4 662,1 501,2 438,9 389,6 526,1
Chain index
100.0 119,2 106,0 113,4 103,6 105,3 106,4 75,7 87,6 88,8 135,0
Source: ITC and BNB
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Figure 9 Dynamics of the export of wood materials and of products of wood, except
furniture (million EUR)
Износ на дървен материал и изделия от него, без
мебели
0
100
200
300
400
500
2000г 2001г 2002г 2003г 2004г 2005г 2006г 2007г 2008г 2009г 2010г
мл
н.е
вр
о
Source: ITC
Based on the data from table 5 most significant is the export share of wood and of
products of wood, except furniture, of group “Manufacture of products of wood, cork, straw
and plaiting materials” – 60% of the export in the sector for 2009, marking increase to 72% in
2010. Notwithstanding the increase of the share in the export structure for group “Manufacture
of products of wood, cork, straw and plaiting materials ", the volume of the total export in the
sector is going down by approximately 30% in 2010, relative to 2009. In group “Sawmilling
and planing of wood; impregnation of wood” the decrease is by approximately 20% for 2010,
relative to 2009.
Table 6 Indicators of the condition of the export of the SMEs in the frame of sector
“Manufacture of wood and of products of wood, except furniture”
CEA Groups of companies Export
(thousand
s BGN)
Export
(thousan
ds BGN)
Export Structure of the
export %
Export
per one
employed
Export
per one
employed
2009 2010 2010/
2009
2009 2010 2009 2010
16 Manufacture of
wood and of
products of wood,
except furniture”
114357
82920
72.51
100,00 100,00 8030 16.0
16.1 Sawmilling and
planing of wood;
impregnation of
wood
29413 23367 79.44 40 28 5604 16.1
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” 16.2 Manufacture of
products of wood,
cork, straw and
plaiting materials
84944 59553 70.11 60 72 9445 16.2
Source: NSI
Summary conclusions:
In 2010 the export, realized by the SMEs in sector “Manufacture of wood and of
products of wood, except furniture” falls down by almost half in relation 2009. It is
due to a great extent to the fact that large companies in the sector have taken
market niches, that, although few in number, have significant export capacity.
In 2010 the indicator “volume of the export per 1 employed” of the SMEs of sector
“Manufacture of wood and of products of wood, except furniture” has decreased
by 23% in relation to 2009.
Main export share of the SMEs of the sector hava the companies, manufacturing
products of wood, cork, straw and plaiting materials” –72%.
GOODS WITH EXPORT ADVANTAGES AND POTENTIAL
The world import of wood and articles of wood; wood charcoal is estimated on slightly
over 83 billion EUR for 2010, where the share of the Bulgarian export therein for 2010 is
accounting for 0,24%. For the whole period 2001 -2010 worldwide has been imported wood
and articles of wood to the amount of approximately 820 billion EUR. The Bulgarian export is
over 1, 498 billion EUR and constitutes around 0,18%.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Table 7 Structure of the export of wood and articles of wood; wood charcoal – Chapter 44
under CN 2010 for the period 2001 - 2010, Main commodity groups with relative share of
over 1% (in thousands EURO)
Code Commodity group Thousand
EUR
Share in the
group %
'4410 Particle board and similar board (for example,
oriented strand board (OSB) and waferboard) of
wood or other ligneous materials, whether or not
agglomerated with resins or other organic binding
substances
459 116 31
'4407 Wood sawn or chipped lengthwise, sliced or
peeled, whether or not planed, sanded or end-
jointed, of a thickness exceeding 6 mm
280 528 19
'4411 Fibreboard of wood or other ligneous materials,
whether or not bonded with resins or other organic
substances
153 508 10
'4403 Wood in the rough, whether or not stripped of
bark or sapwood, or roughly squared
137 691 9
'4412 Plywood, veneered panels and similar laminated
wood
93 265 6
'4415 Packing cases, boxes, crates, drums and similar
packings, of wood; cable-drums of wood; pallets,
box pallets and other load boards, of wood; pallet
collars of wood
59 494 4
'4401 Fuel wood, in logs, in billets, in twigs, in faggots
or in similar forms; wood in chips or particles;
sawdust and wood waste and scrap, whether or not
agglomerated in logs, briquettes, pellets or similar
forms
57 361 4
'4409 Wood (including strips and friezes for parquet
flooring, not assembled) continuously shaped
(tongued, grooved, rebated, chamfered, V-jointed,
beaded, moulded, rounded or the like) along any
of its edges, ends or faces, whether or not planed,
sanded or end-jointed
55 968 4
'4402 Wood charcoal (including shell or nut charcoal),
whether or not agglomerated
52 976 4
'4408 Sheets for veneering (including those obtained by
slicing laminated wood), for plywood or for other
similar laminated wood and other wood, sawn
lengthwise, sliced or peeled, whether or not
planed, sanded, spliced or end-jointed, of a
thickness not exceeding 6 mm
35 617 2
'4418 Builders' joinery and carpentry of wood, including
cellular wood panels, assembled parquet panels,
25 508 2
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
shingles and shakes
'4421 Other articles of wood 25 452 2
'4404 Hoopwood; split poles; piles, pickets and stakes of
wood, pointed but not sawn lengthwise; wooden
sticks, roughly trimmed but not turned, bent or
otherwise worked, suitable for the manufacture of
walking-sticks, umbrellas, tool handles or the like;
chipwood and the like
17 383 1
'4419 Tableware and kitchenware, of wood 13 300 1
(source: ITC, own calculations)
In the structure of the Bulgarian export for 2010 the biggest share – 31% have the
products under group 4410 “Particle board and similar board (for example, oriented strand
board and waferboard) of wood or other ligneous materials, whether or not agglomerated with
resins or other organic binding substances”, for which is characteristic that are manufactured in
the big companies of the branch. At second place with 19% follows group 4407 “Wood sawn
or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end-jointed, of a
thickness exceeding 6 mm” and group 4411 “Fibreboard of wood or other ligneous materials,
whether or not bonded with resins or other organic substances” with 10%. The three groups
together comprise 60% of the Bulgarian export of wood and articles of wood for the period
2001-2010.
In order to receive more clear vision of the export development of the sector SMEs and as
recommended by the experts, in our further analysis other three commodity groups, the SMEs
manufacture and export, will be observed. These are the following:
4403 Wood in the rough, whether or not stripped of bark or sapwood, or roughly
squared – 9% share of the total export in the sector for the studied period
4407 Wood sawn or chipped lengthwise, sliced or peeled, whether or not planed,
sanded or end-jointed, of a thickness exceeding 6 mm – 19 %.
4415 Packing cases, boxes, crates, drums and similar packing, of wood; cable-
drums of wood; pallets, box pallets and other load boards, of wood; pallet collars
of wood – 4%.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Figure 10 Development of the export of wood and articles of wood from Bulgaria in total
under chapter 44 and by CN commodity groups: 4403, 4407, 4415 for the period 2001 -
2010 (in thousand EUR)
(Source: ITC, own calculations)
*Chapter 44 by CN “Wood and articles of wood; wood charcoal”/4403 Wood in the rough, whether or
not stripped of bark or sapwood, or roughly squared/ 4407 Wood sawn or chipped lengthwise, sliced or
peeled, whether or not planed, sanded or end-jointed, of a thickness exceeding 6 mm/ 4415 Packing
cases, boxes, crates, drums and similar packings, of wood; cable-drums of wood; pallets, box pallets
and other load boards, of wood; pallet collars of wood
For the period 2001 until 2010 as a whole the Bulgarian export of wood and articles of
wood follows ascending development, due to the export of wood particle boards, manufactured
and exported mainly by the big companies. The three commodity groups of the above graphics,
representing the main export products of the SMEs show uniform and almost parallel
development of the export with low rates and slightly ascending trend in the last year of the
period.
Table 8 Dynamics of the export of wood and articles of wood from Bulgaria in total under
chapter 44 and by CN commodity groups: 4403, 4407, 4415 for the period 2001 -2010
(2001 =100)
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Wood and articles
of wood; wood
charcoal –
Chapter 44
WORLD
100 100 94 105 111 118 122 108 87 108
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Wood and articles
of wood; wood
charcoal –
Chapter 44
Bulgaria
100 115 113 155 155 171 210 156 148 213
4403 Wood in the
rough, whether or
not stripped of
bark or sapwood,
or roughly
squared
100 65 110 157 178 247 279 170 121 264
4407 Wood sawn
or chipped
lengthwise, sliced
or peeled
100 105 97 98 87 89 77 57 54 83
4415 Packing
cases, boxes,
crates, drums and
similar packing, of
wood;
100 122 118 167 160 172 264 314 293 416
(Source: ITC, own calculations)
The development rates of the Bulgarian export of wood and articles of wood for the
period 2001 -2010 as a whole are outrunning the rates of development of world import. Same is
valid for the rest of the commodity groups with one exception – commodity group 4407 “Wood
sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end-jointed, of a
thickness exceeding 6 mm”, that is lagging behind the development rates of the world import,
as well as of the development of the export of the Bulgarian small and medium-sized
enterprises. Attracts the attention the fast development rate of commodity group 4415 “Packing
cases, boxes, crates, drums and similar packing, of wood; cable-drums of wood; pallets, box
pallets and other load boards, of wood; pallet collars of wood” – 4-fold increase of the export
turnover in 2010 in relation to 2001.
The total export volume for the period 2001 – 2010 of commodity group 4403 is
exceeding 77 billion EUR. The top five countries – exporters are forming in total 52% of the
world export in this group, with relative shares of the world export, as follows: Russia - 24%,
USA - 14%, Malaysia -5%, Myanmar - 5%, New Zealand - 4%. Bulgaria is ranked 50th
place
with a relative share of 0,17%.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Table 9 Dynamics of the export of commodity group 4403 worldwide for the period 2002-
2010 (%, 2002=100), Source: ITC, own calculations
Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
TOTAL
WORLD
100 87 95 110 116 133 118 88 120
Russia 100 91 108 132 149 173 136 75 80
USA 100 85 91 92 91 97 90 75 107
Malaysia 100 92 89 103 96 89 83 81 98
Myanmar 100 110 128 163 155 174 177 133 136
New
Zealand
100 83 66 66 76 86 91 113 191
Bulgaria 100 110 243 276 382 431 263 188 408
Position of Bulgaria in the world export
56 55 54 47 47 43 46 49 53
% of the export of Bulgaria relative to the export of the leading world exporter
- 0.31% 0.37% 0.70% 0.65% 0.79% 0.77% 0.60% 0.77% Source: ITC
The above table is representing data, showing the threefold higher growth of the
Bulgarian export of rough wood of commodity group 4403 relative the global export growth for
the period 2002 – 2010. None of the leading five countries exporters are even close to half of
the value of the index of the Bulgarian export for the last year of the period.
The total volume of the export of sawn wood material of commodity group 4008 for the
period 2001 – 2010 is exceeding 229 billion EUR. The top five countries – exporters are
forming in total 55% of the world export in this group, with relative shares of the world export,
as follows: Canada - 25%, Sweden - 10%, USA -7%, Russia - 7%, Finland - 6% Bulgaria is
ranked 54th
place with a relative share of 0,12%.
Table 10 Dynamics of the export of commodity group 4407 worldwide for the period 2002-
2010 (%, 2001 = 100)
Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
TOTAL
WORLD
98 88 98 101 108 108 86 70 90
Canada 88 68 86 83 78 60 41 29 44
Sweden 108 107 106 110 129 137 113 104 121
USA 91 77 78 81 90 77 62 55 84
Russia 119 135 158 198 239 307 249 243 296
Finland 103 103 100 92 103 116 82 63 83
Bulgaria 105 102 98 87 89 77 57 54 83
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
Position of Bulgaria in the world export
47 50 52 55 59 59 62 63 61
% of the export of Bulgaria relative to the export of the leading world exporter
0.47 0.59 0.45 0.41 0.45 0.50 0.54 0.72 0.74
Source: ITC, own calculations
The data of table 10 are showing similar development rate of the Bulgarian export of
sawn wood material of commodity group 4407 with that of the world export for the period
2002 – 2010, demonstrating a slow down and decrease in the index values in the last years with
certain increase in 2010.
The total volume of the export of wood material of commodity group 4415 “Packing
cases, boxes, crates, drums and similar …” for the period 2001 – 2010 is approximately 18
billion EUR. The top five countries – exporters are forming in total 40 % of the world export in
this group, with relative shares of the world export, as follows: Poland - 12%, Germany - 9%,
Belgium - 7%, Canada - 6%, The Czech Republic - 6%. Bulgaria is ranked 54th
place with a
relative share of 0,12%.
Table 11 Dynamics of the export of commodity group 4415 worldwide for the period 2002-
2010 (%, 2001 = 100)
Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
TOTAL
WORLD
100 96 100 101 110 126 127 96 117
Poland 103 129 156 147 167 212 201 143 192
Germany 100 93 98 116 131 144 152 121 144
Belgium 107 93 95 98 103 126 134 105 124
Canada 107 88 92 97 85 73 62 47 56
The Czech
Republic
96 98 128 113 136 176 182 134 155
Bulgaria 122 143 167 160 172 264 314 293 416
Position of Bulgaria in the world export
46 44 39 46 47 36 34 35 31
% of the export of Bulgaria relative to the export of the leading world exporter
2.35 2.19 2.12 2.14 2.04 2.47 3.10 4.07 4.28
Source: ITC, own calculations
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
The above table is representing data, showing the nearly four-fold higher growth of the
Bulgarian export of products of commodity group 4415, relative the global export growth for
the period 2001 – 2010.
The data for the percentage ration of the export of Bulgaria relative to the export of the
leading world export of export groups under CN 4403 “Rough wood material” and 4415
“Packing cases, boxes, crates, drums and similar packing” for the period 2001 – 2010, are
showing stable trend of stabilizing the reached positions and are demonstrating export
potential.
The sector is disposing of quality and recognized products, especially those of group 4415
“Packing cases, boxes, crates, drums and similar packing”, exporting to traditional markets,
mainly in Balkan countries, non-Balkan EU countries and to the Middle East.
Table 12 presents the leading trade partners in the export of Bulgaria under for the
commodity groups in sector “Manufacture of wood and of products of wood, except furniture”,
according to data of the ITC for a 10-year period.
Page 47
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Table 12 Leading export partners for the commodity groups in sector “Manufacture of wood and of products of wood, except
furniture” for the period 2000 - 2010
2000 EUR'
mln
2001 EUR'
mln
2002 EUR'
mln
2003 EUR'
mln
2004 EUR'
mln
2005 EUR'
mln
Other products of wood,
cork, straw and plaiting
materials
143,6 193,6 188,0 211,5 203,3 216,6
1 Italy 109,1 Italy 149,9 Italy 142,8 Italy 152,9 Italy 137,1 Italy 147,5
2 Germany 6,5 Germany 8,6 France 13,6 France 15,2 Austria 14,1 Austria 17,5
3 France 3,8 France 8,0 Germany 6,7 Austria 10,5 France 10,5 Germany 11,7
4 UK 2,9 UK 4,0 Greece 3,3 Germany 5,5 Germany 7,6 France 10,6
5 The Netherlands 2,6 The
Netherlands
3,9 UK 3,2 UK 4,4 UK 7,5 UK 6,1
Sawmilling and planing
of wood; impregnation
of wood
52,2 47,8 47,2 48,8 56,1 57,4
1 Greece 17,2 Greece 22,7 Greece 19,3 Greece 21,8 Greece 29,0 Greece 25,3
2 Turkey 9,9 Italy 8,1 Italy 8,0 Macedonia 6,9 Italy 6,2 Turkey 10,0
3 Macedonia 6,7 Macedonia 5,2 Macedonia 7,6 Italy 6,7 Turkey 5,9 Italy 8,8
4 Italy 6,3 Turkey 3,4 Turkey 3,8 Turkey 3,9 Macedonia 5,5 Macedonia 4,3
5 F. Yugoslavia 4,7 F. Yugoslavia 1,1 France 1,6 France 1,7 France 2,0 France 2,2
Wood packing 3,0 3,1 3,9 4,3 5,0 4,9
1 Greece 2,1 Greece 2,1 Greece 2,2 Greece 2,5 Greece 3,2 Greece 3,0
2 Germany 0,2 Italy 0,2 Italy 0,5 Italy 0,5 Italy 0,6 Italy 0,6
3 Italy 0,2 France 0,1 France 0,2 Austria 0,2 Austria 0,2 Austria 0,3
4 France 0,1 Germany 0,1 Austria 0,2 France 0,2 Turkey 0,2 Turkey 0,2
5 Israel 0,1 Israel 0,1 Germany 0,2 Germany 0,2 France 0,2 France 0,2
Assembled parquet
floors
6,9 8,1 6,9 9,5 9,3 10,6
1 F. Yugoslavia 1,3 Russian
Federation
2,1 Italy 1,2 Greece 1,2 Greece 1,4 Italy 2,4
2 Greece 1,1 Italy 1,2 F. Yugoslavia 1,1 F. Yugoslavia 1,2 Italy 1,2 Greece 1,1
Page 48
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” 3 Bosnia and
Herzegovina
0,9 F. Yugoslavia 1,0 Germany 0,9 Italy 1,2 F. Yugoslavia 1,1 F. Yugoslavia 0,9
4 Russian
Federation
0,8 Germany 0,6 Greece 0,9 Albania 0,7 USA 0,7 USA 0,7
5 Macedonia 0,7 Greece 0,6 Macedonia 0,6 Croatia 0,5 Spain 0,6 Germany 0,6
Veneer sheets and wood-
based panels
27,7 25,5 48,9 60,3 72,7 75,1
1 Italy 7,8 Italy 9,4 Italy 10,1 Italy 12,4 Turkey 16,9 Turkey 18,7
2 Greece 5,5 Greece 5,1 Greece 6,6 Turkey 10,2 Italy 11,8 Italy 10,1
3 Germany 4,8 Germany 4,2 Turkey 5,8 Greece 6,1 Greece 7,3 Greece 8,1
4 Sudan 2,8 Sudan 2,1 Germany 3,7 Sudan 3,1 Macedonia 3,1 Azerbaidjan 4,4
5 Turkey 1,5 The Czech
Republic
0,8 UK 2,5 Germany 2,5 Azerbaidjan 3,0 Rumania 3,6
2006 EUR'
mln
2007 EUR'
mln
2008 EUR'
mln
2009 EUR'
mln
2010 EUR'
mln
Other products of wood,
cork, straw and plaiting
materials
226,5 197,1 183,4 59,7 211,5
1 Italy 151,6 Italy 140,0 Italy 124,4 Italy 39,4 Italy 137,3
2 Austria 20,4 France 12,1 France 10,8 Hungary 5,7 Hungary 24,6
3 UK 10,9 Hungary 10,3 The Czech
Republic
10,0 France 3,2 Rumania 9,7
4 France 10,8 Greece 5,9 Germany 6,6 Rumania 2,6 Germany 7,6
5 Hungary 8,6 Germany 5,8 Hungary 6,0 Germany 2,3 France 7,3
Sawmilling and planing
of wood; impregnation
of wood
65,5 58,0 42,4 30,9 69,5
1 Greece 28,2 Greece 29,2 Greece 26,8 Greece 24,4 Greece 24,4
2 Turkey 13,2 Turkey 12,0 Italy 4,9 Turkey 13,4 Turkey 20,1
3 Italy 10,2 Italy 8,1 Turkey 3,3 Macedonia 8,3 Italy 7,6
4 Macedonia 4,2 Macedonia 2,3 France 2,1 France 1,3 Macedonia 6,9
5 France 2,0 France 1,8 Macedonia 1,7 Italy 0,8 France 3,3
Page 49
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises” Wood packing 5,3 7,4 8,7 0,6 11,8
1 Greece 3,0 Greece 4,2 Greece 5,0 Greece 1,8 Greece 4,6
2 Italy 0,7 Italy 1,0 Italy 1,0 Rumania 0,3 Italy 2,9
3 Turkey 0,3 Rumania 0,4 Rumania 0,7 Italy 0,3 Rumania 2,5
4 Austria 0,2 Hungary 0,3 Germany 0,4 Germany 0,1 Germany 0,4
5 Rumania 0,2 Turkey 0,3 Austria 0,2 Serbia 0,1 Austria 0,3
Assembled parquet
floors
12,0 14,4 9,5 2,9 9,9
1 Italy 1,9 Italy 3,7 Italy 1,3 Greece 0,4 Italy 1,4
2 Greece 1,8 France 1,7 France 1,3 Italy 0,3 UK 1,2
3 France 1,2 Greece 1,5 Greece 1,2 France 0,2 Greece 1,1
4 USA 0,8 Serbia 1,4 Germany 0,9 Germany 0,2 France 1,0
5 UK 0,7 Germany 1,1 Serbia 0,7 Switzerland 0,2 Germany 0,9
Veneer sheets and wood-
based panels
78,7 16,8 13,3 3,3 5,6
1 Turkey 18,2 Turkey 3,2 Greece 2,9 Greece 1,7 Greece 2,6
2 Greece 11,4 Greece 2,4 Rumania 2,3 Turkey 0,6 Serbia 0,9
3 Italy 11,3 Rumania 2,1 Turkey 1,3 Rumania 0,4 Turkey 0,7
4 Rumania 7,0 Italy 1,7 Germany 1,2 Germany 0,2 Italy 0,5
5 Macedonia 4,3 Poland 1,2 The Czech
Republic
1,1 Poland 0,1 Austria 0,2
Source: ITC
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Based on the data of table 12, the traditional markets for export of sector “Manufacture
of wood and of wood products, except furniture” are those of our neighbour countries Greece,
Turkey, Macedonia, Serbia, Rumania, and for the products of higher processing level these are
the markets of Italy, France, Austria.
Potential markets for the SME of the sector are those of Germany, The Czech Republic,
Hungary, Russian Federation, Israel, Azerbaijan, Sudan, Poland, UK, where in the last years
the registered export of Bulgarian products is with higher level of processing as wood packing,
veneer sheets, wood-based panels. The manufacture and export of these products is
concentrated mainly in large companies and requires the SMEs to make the necessary
investment for modernization of their production capacity and diversification of their
production in order to successfully enter into these market niches.
Analysis of the priority markets by the various commodity groups of the sector:
Table 13 Leading countries importers of the Bulgarian products of group 4403 “Rough
wood materials” in total for the period 2001 -2010 (in % of the total export of Bulgaria of
the products of group 4403)
Position Country partners %
TOTAL WORLD 100%
1 Greece 61%
2 Turkey 33%
3 Macedonia 3%
4 Italy 2%
5 USA 0.43% (source: ITC, own calculations)
Table 14 Leading countries importers of the Bulgarian products of group 4403 “Rough
wood materials” in total for 2010 (in % of the total export of Bulgaria of the products of
group 4403)
Position Country partners %
TOTAL WORLD 100%
1 Turkey 54%
2 Greece 34%
3 Macedonia 9%
4 Austria 2%
5 Italy 1% (source: ITC, own calculations)
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
The given in the above tables data (table 13 and 14) are showing that in commodity group
4403 “Rough wood material” the factor, determining the success of the export activity is the
geographical proximity. The relatively low prices of the product relative to the price of the
transport service for the delivery, is transforming the distance in main factor for the more
successful realization into domestic markets.
Out of the top leading markets - Turkey, Greece, Macedonia, Austria, Italy, for the
products of commodity group 4403 “Rough wood material”, in 2010 the Bulgarian SMEs of
the sector have gained best positions in Greece, where Bulgaria is leading importer with almost
one third of the total import of this commodity group, market share and incomes of over 7.5
million EUR for 2010. Into the Macedonian market Bulgaria is also holding leading position
with 73% of the local market. Although in 9th
position, the export of products of group 4403 in
Turkey are ensuring incomes of nearly 12 million EUR in 2010. Main competitors to the sector
on the leading markets in this group are the CIS countries, the Balkan and African countries
and some of the EU countries.
Table 15 Leading countries importers of the Bulgarian products of group 4407 “Wood,
sawned…” in total for the period 2001 -2010 (in % of the total export of Bulgaria of the
products of group 4407)
Position Partner country %
TOTAL WORLD 100%
1 Greece 44%
2 Turkey 20%
3 Macedonia 16%
4 Italy 5%
5 Jordan 3%
Source: ITC, own calculations
Table 16 Leading countries importers of the Bulgarian products of group 4407, in total for
2010 (in % of the total export of Bulgaria of the products of group 4407)
Position Partner country %
TOTAL WORLD 100%
1 Greece 42%
2 Turkey 18%
3 Macedonia 16%
4 Italy 11%
5 Jordan 2%
Source: ITC, own calculations
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
The main market, where the products of the sector of group 4407 “Wood sawn or chipped
lengthwise, sliced or peeled” are realized are the neighbour to Bulgaria countries, namely
Greece, Turkey and Macedonia.
In this commodity group, as in the sector as a whole, is witnessed the strong dependence
on a small number of markets with similar characteristics, making the sector extremely
vulnerable from the unfavourable development of the economy conjuncture in this region.
Out of the five leading markets - Greece, Turkey, Macedonia, Italy, Jordan, for the
products of commodity group 4407 “Wood sawn or chipped lengthwise, sliced or peeled”, in
2010 the Bulgarian SMEs of the sector have gained best positions one more time in Greece,
Turkey and Macedonia. Main competitors in the sector of the leading markets in this group
are some of the Scandinavian countries, the CIS countries, USA and some EU countries.
Table 17 Leading countries importers of the Bulgarian products of group 4415 “Packing
cases, boxes, crates, drums and similar packing of wood” in total for the period 2001 -
2010 (in % of the total export of Bulgaria of the products of group 4415)
Position Partner country %
TOTAL WORLD 100%
1 Greece 58%
2 Italy 14%
3 Rumania 8%
4 Germany 3%
5 Austria 3%
Source: ITC, own calculations
Table 18 Leading countries importers of the Bulgarian products of group 4415, in total for
2010 (in % of the total export of Bulgaria of the products of group 4415)
Място Страна партньор %
TOTAL WORLD 100%
1 Greece 39%
2 Italy 25%
3 Rumania 21%
4 Germany 3%
5 Austria 2%
Source: ITC, own calculations
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
The main market, where the products of the sector of group 4415 “Packing cases, boxes,
crates, drums and similar packing, of wood” are exported, are: Greece, Italy, Rumania, with
main weight of the Greek market. This is putting the sector on test considering the
unfavourable economic process within three of the above indicated countries. Due to the high
level of processing, the products of this group have an advantage before the other two groups in
relation to the realization opportunities and the more distant markets in Europe and abroad.
Out of the five leading markets - Greece, Italy, Rumania, Germany and Austria, for the
products of commodity group 4415 “Packing cases, boxes, crates, drums and similar packing,
of wood”, in 2010 the Bulgarian SMEs of the sector have gained best positions again in Greece
– 1st 38.6% market share, Italy and Rumania. Main competitors in the sector of the leading
markets in this group are the Western European countries as Germany, Italy and Poland,
speaking of quality and competitiveness of the exported by the SMEs products of group 4415
“Packing cases, boxes, crates, drums and similar packing, of wood”.
The information of the carried out survey in sector “Manufacture of wood and of products
of wood, except furniture” gives the possibility to follow the main export destinations of the
companies and the approximate export share of their products and services..
Figure 11 Export markets of the studied companies (in %)
Source: Sociological survey
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
*Africa and Middle East, 1.82
Asian countries, 3.64
Other European countries, 5.45
Other, 7.27
Balkan countries out of the EU, 27.27
EU countries, 54.54
On Figure 11 are shown the export markets of the studied companies. The main
destination is the EU – more than the half of the export. At the front positions as destinations
are Germany and Greece (most companies have indicated namely these two countries).
Second are ranked the Balkan countries, non-EU members – mainly Turkey, but also Serbia,
Macedonia, Kosovo. Almost 40% of the export destinations of the companies are the Balkan
countries (in and out of the EU). This represents a serious challenge for the sector companies,
as one of their main competitors on the international markets are namely the countries from our
regions. Among the European countries out of the EU most commonly is indicated Russia. The
rest of the export destinations have shares under 10%.
On Figure 12 are given the export shares of the studied companies of sector “Manufacture
of wood and of wood products, except furniture”.
Figure 12 Percent ratio of the export by number of export markets
Sociological survey
*number of markets /export percentage – up to 30%; 31-60%; 61-99%;100%
Observation: Four companies of the sector haven’t indicated their export shares
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
The most are the markets where the export is up to 30%. Follow those, with export
shares between 31 and 60%. To seven export destination is exported by 100% of the companies
production. It may be also indicated that the number of markets with export share up to 30% is
almost equal to the number of market share of over 30%.
The main competitors on the world markets for the studied companies are the EU
countries. The competition is quite strong – at first place, with almost 30% of the opinions
come Germany and Rumania. Follow Italy, Greece and the Czech Republic. The other
competitors (Spain, Portugal, Austria, Slovenia, etc) are in the rear positions in the ranking.
Among the countries out of the EU main competitor to the Bulgarian companies is
Turkey. Follow China, Russia and Ukraine. It is noteworthy that the companies from the
branch are also competing with the USA, Canada and India, but these countries are given by
smaller number of respondents. If talking about the regional aspect and to Turkey we add also
Rumania and Greece, we may say that the companies from the branch have serious competition
in the frame of the Balkan peninsular. However (as said above) these are also one of the most
serious export destinations of the Bulgarian companies.
The export production of the SMEs of sector “Manufacture of wood and of products of
wood, except furniture” still has low level of processing and is impossible to ensure an added
value in the export incomes that is big enough, as the major part of the export production
represent raw material for further manufacture abroad.
Due to the low level of processing and respectively the low price of the production of the
sector, the transport expenses are resulting to be of great importance in order to determine the
export destination of the Bulgarian manufacture, that are mainly our neighbour countries -
Greece, Turkey, Macedonia, Serbia, Kosovo, Rumania, and for the products of group 4415 are
Italy and Germany.
The SMEs of the sector should streamline their efforts on the one hand towards keeping
the gained market positions on the traditional markets of the region and on the other to
diversify their production with products of higher processing level, in order to be able to count
on realization into foreign markets outside the region.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
COMPETITIVENESS OF THE EXPORT OF GOODS ON INTERNATIONAL
MARKETS
The low level of manufacturing of the exported products makes the export of the SME of
the sector dependant on the geographic proximity of the markets.
In all three commodity groups (4403, 3307 and 4415) the top five countries-importers of
Bulgarian wood products and materials are ensuring more than 50% of the export incomes.
This is a sign of strong dependence on small number of markets and clients.
The sector SMEs are leading importers on the markets of the neighbor Balkan countries.
Although with leading market positions in the surrounding countries, the low level of
manufacturing and the small volume of added value in the sector products cannot contribute
to significant incomes of the realized export.
In almost all commodity groups the main competitors are the CIS countries, the Balkan
countries, some African, Scandinavian and other European countries.
Main advantages of the EU competitors, indicated by the respondents, are related to:
favourable custom regulation; geographical situation (lower transport costs); imposed brand
of certain products on the markets; the financial resources these are disposing of, and least
but no last – the State support and the good business climate therein.
Unfavourable trend, leading to lower competitiveness is the low-developed research
activity.
The made findings and conclusions give ground to expect that within the next five years the
export of Bulgarian wood and of products of wood, will grow, although slowly.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
BARRIERS TO THE INTERNATIONALIZATION OF SMALL AND MEDIUM
ENTERPRISES AS WELL AS MEASURES AND PERSPECTIVES FOR
STIMULATION AND DEVELOPMENT OF EXPORT
Internalization is one of the ten main principles of Small Business Act (SBA) – the
main document of the European Committee regarding the policy to SMEs in EU developed in
2008 – and it includes all different groups of activities related to connections with foreign
markets that one company starts at accomplishing its economic activity. The global dynamics
regarding the political and macro-economic circumstances results in internalization and in our
days it includes not only goods and services for foreign countries but also a great number of
other activities – like investing in foreign country (direct foreign investments), formation of
partnerships with foreign companies, recruiting foreign experts as sub-contractors, participation
in international networks and others. There is tendency to continuous increase in the number of
SMEs operating on the international markets. This results in increase of their contribution to
the world economy and respectively – changes their significance as business partner. This
strategy is focused on improving the process of exportation of SMEs of the sector, so
internalization is considered as narrower term, including only export of goods.
The barriers to entering the market are factors, that make difficult or prevent the
entering of new companies into given industrial sector. The existence of barriers to the entering
into the market is always a factor, limiting the development of a competitive market.
The term “obstacle to trade” or “barrier” refers to “any trade practice, adopted or
supported by third country, in relation to which the international trade rules foresee a right to
undertake actions”.
Usual obstacles to trade may be:
Import-related national provisions (import licenses, inspections and examinations);
Obligations to assign a representative or to ensure warehouse premises in the State
of export;
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
National control on prices and reimbursement of expenses.
The most serious barriers to the Bulgarian export of the small and medium size
enterprises in sector “Manufacture of wood and of products of wood, except
furniture”, based on the carried out sociological survey and discussion of the present
strategy in the focus groups, are related mainly with external factors:
barriers for entering into foreign markets;
need of upgrading the economic and administrative support of the State to
support the sector in formulating the tasks for the new programme period of
European funding;
high risk of the various foreign markets;
unfavourable business environment in Bulgaria;
technical and technological indicators – insufficiently high level of goods and
services;
the human factor – relatively less risky for the export.
The analysis of the effectiveness of the measures for promoting the export of the small
and medium-size enterprises and development perspectives is organized in a way to give
answer to the following questions:
1. What are the priority measures for supporting the production process of the small and
medium-size enterprises and of the export, in particular
2. Which are the measures, influencing the most the SMEs export
3. What is the efficiency of the services, provided by BSMEPA, on the export activity of
the SMEs
4. Which are the main sources of information for the export possibilities of the SMEs
In relation to the above indicated serious barriers are also the suggested as priority
measures for overcoming the obstacles to the export of the companies and the sector as a
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
whole. Analogically, these are related mainly to the State support for the export of the
companies and of the sector 1) reducing the bureaucracy and 2) releasing the companies’
capital, so that these could invest in the production upgrade. Such measures are:
In this sense the respondents have indicated that ”the procedures for export should be
relived and the bureaucracy should be reduced”, “the State should allocate funds for supporting
the expenses needed for European and other international exhibitions”, “to be ensured relieved
funding for export”. As higher proprietary are offered also measure for improving the business
climate. It seems important the measure, proposed by one of the respondents: ”there are too
much procedures for VAT reimbursement – in this way the State keeps the free capital of the
companies and prevent investments”. This proposal concerns: 1) reducing the bureaucracy and
2) releasing the companies’ capital, these could invest in the production upgrade
More than 96% of the interviewed small and medium-size enterprises indicated that they
are producing finished product, designated to be exported, where in 64% of the cases the level
of manufacturing is high and in the rest of the cases it’s average or low. Approximately 35% of
the SMEs are exporting raw materials and 43% - semi-manufactured article, mainly with high
level of manufacture (The sum of the percents is over 100, as the respondents have indicated
more than one answer).
– support for the technological modernization of the production
– Encouraging the export of the companies;
– Improvement of the access to funding;
– Funding of innovation projects for the development of new products, technologies
and services.
– Training and improvement of the qualification of the employed in SMEs;
– Support for technological innovations.
Among the factors having positive impact on the export activity of the companies of
the sector, is the support for the participation in international fairs, exhibitions and business
forums. At second place are the factors “establishment of contacts with foreign institutions”;
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
“funding of programmes for the development of innovation activities” and “communication
with trade representatives”.
Regarding the BSMEPA activity, positively are evaluated: 1) “organization of
information campaigns”; 2) “information for offers and inquiries by foreign companies”; 3)
“Information about international and regional markets”, “organization of participation in
international exhibitions and fairs”, “information about international tenders”.
Additional information the survey companies mainly need is logistics, mechanisms of
international trade payments, information about the markets in Asia (Jordan, Iran, Iraq); clearer
information for law procedures, information about contractors, etc.
Most of the priority measures for overcoming the barriers to the export are expected to be
undertaken by the State. At the same time the companies clearly understand the need of
technological upgrade of the production and the lack of own resources, indicating mainly the
support for the technological modernization as measure with highest priority, as well as
measures, related to ensuring financial support by the State under different forms.
The companies are usually gathering the necessary information about the export
individually – through own surveys and through the internet. It is interesting that they don’t
count much neither on the branch organizations, nor on their colleagues in the country. In third
place (after own survey and internet) they indicated colleagues from abroad. Probably, it is
related with the competition among the companies in the branch.
The corruption risk profile in this sector is determined by the nature of the markets for
which such production is exported, the existing export situation as well as the sustainability and
economic results of the enterprises which invest its end production in such products.
The expert evaluations trace the following profile of potential corruption risk:
The relatively conservative nature of this market does not presuppose the putting of
systematic effort in innovation development
Pressure by the administrative structures and the existing influence networks, also
within the relationships between the companies themselves.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Relative limitation of the number of potential participants as a result of the economic
crisis. The build through the years stable partnerships are determining the common
market chances of the new and less potential exporters.
Lack of competent personnel for performing the activity.
Lack of internal rules and procedures for guaranteeing the interests of the
exporters/foreign importers.
Lack of regulatory mechanisms and institutions, fixed as competences and
responsibilities in the field of the regulatory environment
Dynamic change of the requirements of the foreign users.
Unstable and/or extremely sensible to the market oscillations regulatory environment,
as well as lack of comparability between the external and internal production quality
standards.
Limitation of the profit and increase of the sense of instability in time of crisis.
As tools for assessment of the corruption risk and for planning export strategies could be
used three already recognised international surveys of the international anti-corruption
organisation Transparency International: Corruption perceptions index (CPI), Global corruption
barometer (GCB), Bribe payers index (BPI). These give relative information regarding the level
of expansion of the corruption worldwide and the extent to which the national institutions and
sectors are affected.
A) Markets in European Union Member States: Greece, Italy, Rumania, Germany,
UK, France
According to the CPI, the index value for the countries is: UK – 8,2 points, Germany – 8,
France – 7, Italy – 3,9, Rumania – 3,6, Greece – 3,4.
According to GCB the most seriously affected institutions and sectors of corruption are:
Greece – political parties and media; Rumania – political parties and parliament; Italy – judicial
system, customs, agricultural services and medical services.
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
Less affected instutions and sector of corruption are: Greece – fiscal services, media and
judicial systems; Rumania – fiscal services. The highest level of integrity of the work of the
institutions and business could be expected in the UK, Germany and France. In Germany, in
fact, there is lack of corruption pressure on the business by Customs, fiscal services and
Judiciary; the highest percentage of bribe payment is at nationals and companies, having access
to registry services (1,9%).
Most significant pressure for bribe payment (expressed as percentage of nationals asked
to pay a bribe in the last year) exists in the following sectors: Rumania – police (16,2%),
judicial system (13,0%) and registry services (10,8%), agricultural services (6,4%), customs
(5,7%); Greece – customs (16,9%), agricultural services (4,9%) and registry offices (4,4%).;
Italy – judicial system (28,8%), customs (13,9%), agricultural services (12,9%) and medical
services (10%)l France – agricultural services (8,1%), customs (5,4%) and medical services
(5,1%).
B) Markets outside the European Union Member States: Turkey, Macedonia,
Serbia, Albania, Kosovo
According to CPI the above mentioned countries rank as follows: Turkey – 4,2, Kosovo
– 2,9, Albania – 3,1, Macedonia – 3,9, Serbia – 3,3.
According to GCB the most seriously affected institutions and sectors by the corruption
are: Macedonia – customs; Serbia – political parties, followed by public administration,
Judiciary.
Less affected institutions and sectors by the corruption are: Macedonia – fiscal services;
Serbia – registry services.
Most significant pressure for bribe payment (expressed as percentage of nationals asked
to pay a bribe in the last year) exists in the following sectors: Turkey – customs (32,4%),
agricultural services (32,2%), fiscal services (34,5%), registry services (31,2 %), police (28,9
%), Judiciary (26,2 %); USA – customs (18,3%), agricultural services (12,5%), %), registry
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Operational programme “ Development
of the competitiveness of the Bulgarian
economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the
Bulgarian enterprises” Project №
BG161РО003 – 4.2.01-0001 “Promotion
Of The Internationalization Of The
Bulgarian Enterprises”
services (9%), Judiciary (8,4%), fiscal services (5,6%), police (5,7%); Macedonia – customs
(25%); Judiciary (20,6%); Serbia – police (14,5%), Judiciary (13%) and customs (12,4%);
Kosovo – customs (11,2%), registry services (7,2%) and Judiciary (9,5%).
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
SWOT ANALYSIS OF SECTOR “MANUFACTURE OF WOOD AND OF WOOD PRODUCTS,
EXCEPT FURNITURE”
Table 19 SWOT analysis
STRENGTHS OPPORTUNITIES
Traditions in furniture manufacturing and export
Qualified workforce
Sufficient quantities, relatively cheap local raw materials
and energy
Competitive labour cost
Low cost of end products
Good technology equipment in large part of the sector
enterprises
Export orientation of the sector
Strong professional organization
Contacts through the professional organization with
international professional associations (UEA/European
association of the furniture-manufacturers and national
associations)
The sector is defined as export-orientated by BSMEPA
Financial and expert support provided by BSMEPA
Project funding under structural funds
Public incentives for the formation of clusters, incl. export
clusters
Improvement of the country’s image
Increase in demand on target markets –Balkan region, EU,
Middle East
Withdrawal of Western investors from the Far East region
and increased interest in the Eastern Europe region
Increased interest on behalf of investors from the Far East to
the Eastern Europe region
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Flexibility – ability to produce small series, quick response
to market needs, prompt delivery
WEAKNESSES THREATS
Strong dependence on small number of clients (markets)
Production, often not compliant with the target markets
requirements regarding quality and design
Local raw materials often don’t meet the high requirements
of target markets
Few professionals with trade export experience
Insufficient information about foreign markets
Difficulty in providing working capital, debt
Small number of enterprises, certified according to
international standards
Low labour productivity
Limited experience in organizing and participation in
international exhibitions
Deepening of the global economic crisis and consumption
contraction
Decrease in investment activity in worldwide
Difficult crediting
Increased competitive pressure
Higher barriers to entry the target markets
Increased prices of raw materials and energy
Increased labour cost
Lack of reliable information for management decision
making
Decrease in the number of Bulgarian trade representations
abroad
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
PESTEL ANALYSIS
The PESTEL analysis of factors and tendencies on macro level, having impact on Bulgarian
manufacturing industry development, SME and in particular of the sector of “Manufacture of wood
and of wood products, except furniture”.
The PESTEL analysis is abbreviation of the first letters of the English words and it includes
several groups of factors that are to be analyzed: political, economic, social, technological,
environmental factors, legal.
The Republic of Bulgaria as a member state of the European Union having full rights,
employ all instruments of political stability and namely democracy, implemented political
pluralism, implemented election system, working Bulgarian institutions harmonized with the
European legislation. In our country there is guaranteed political stability on national level which
is guarantee for realization of investments and development of projects, for financing and
organizing export activities. Bulgaria leads active international policy and thus helps the
development of the market positions for its export. This factor is of extreme significance for the
functioning and main precondition for export increase.
In relation to the economic indicators on macro-level, the country depends on the world and
European trends due to the openness of the economy and its engagement with the operating
markets, international exchanges, international credit evaluations and rating evaluations, etc. that is
why the economic processes in the country should be followed in the context of the economic and
financial processes within the European Union and the Eurozone. Most of all, however, it should
be unambiguously underlined that the current adopted policy of macroeconomic stability and fiscal
and financial discipline creates relatively predictable macroeconomic environment for the market
participants. The following table shows the PESTEL analysis.
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Table 20 PESTEL analysis
Political factors Economic factors
Bulgaria is a parliamentary republic and member
state of the EU enjoying full rights
Income policy is based on taxes, fees and others as
the main division is of state and municipal.
As a member state of the EU, Bulgaria is part of the
structure for international trade and operating agent on
the common European market
There are different operating laws and established
commissions for protection of the consumers
The political stability is main priority for the
governing majority
Safety and competitiveness stimulation are starting
points in promoting trade activity
Despite the world financial instability, Bulgaria
manages to maintain levels of stable development and
positive economic growth.
The interest percentage is determined by the central
bank (BNB) and has a tendency to reduction as of 01.11.2011,
it is 0.22%
The country promotes employment as through
attraction of foreign investments, it creates new employment
positions and re-qualification programs for unemployed
people.
Income taxing is done by ‘flat’ stake amounting to
10%.
The Bulgarian currency is in condition of currency
matching to euro at the rate of 1.95583 BGN per 1 euro.
The adopted by the government financial policy
manages to retain inflation within its normal values.
Consumers’ trust is put to serious test because the
system of regulation and management of quality needs higher
effectiveness.
Social factors Technological factors
The cultural-demographic detachment of Bulgaria
suggests a lot of everyday life and cultural differences
between the wide ranges of ethnic groups. However, the
integration of these ethnic groups is successful.
Relative ageing of the population and negative
population growth (-0.6% for 2010). Positive population
The research activity in Bulgaria has rich tradition and
experience
The industry functions and is organized by
technological operations which determine the necessity of
their knowing and research.
Bulgaria is among the world leaders in terms of its
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
growth was registered during the period from 1960 to 1990
then it becomes negative and reaches its lowest levels in
1990 and 2001 almost reaching -2.0%.
Statistics like this clearly re-create the influence of the
political factors over the social and demographic structure
of community.
At national level it is observed an expressed labour
mobility and a certain part of the specialists find
professional realization abroad and in particular – within
the EU. This shows how the mechanisms of the community
work and how the labour market creates demand and
supply outside the borders of a country.
The living standard in Bulgaria is a social category
subject to a thorough examination and multi-factorial
analysis. The level of net income is relatively low, unlike
that of ownership of real estate.
Entrepreneurship in Bulgaria is the reason for the
implementation of many projects, including the absorption
of funds from European fund paths.
The issue of education in Bulgaria is a topic of utmost
priority. The state provides free elementary, primary and
secondary education; higher education also being
financially supported for the most part
research-workers who gave to the world numerous
discoveries, inventions and innovative technologies. Few of
them reach community due to the fact they do not find
investors in the country.
The exchange of technology with the rest of the world
has marked its beginning since the early years of the last
century. With the construction of the modern state, these
technologies play a significant role in the construction of each
unit.
The life cycle of the products, as well as their going
out of use, becomes shorter and shorter with the opening of
markets and the invasion of newer and more energy-efficient
products.
Both in political and in purely technical aspect, the
global energy saving policy is also applied in Bulgaria. It
includes the construction of alternative energy sources that
should reduce the levels of harmful emissions and generate
lower levels of cost for the end user
Regarding the information technologies and the
Internet, the country is among the European leaders in the
field of their introduction, use and development.
Environmental factors Legal environment factors
Bulgaria is among the countries with the most widely
developed and included eco-tourism in Europe.
It is being worked on strategies for wastewater
treatment and construction of incinerators for waste
incineration.
Planned urbanization and cultivation of gardens,
Bulgaria is a statutory Republic and the fundamental
law is the Constitution.
Bulgaria’s judicial system is a direct expression of the
judiciary branch and it is divided into different levels and
instances for the purpose of being more accessible to people.
Of all the rights, the one of private property is the
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
parks and ponds.
starting point for most of the changes after the transition to a
market economy.
Bulgaria is a country with established legal system
that allows its citizens position and protection and that
guarantee them the full functioning of democracy.
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
STRATEGIC OBJECTIVES FOR PROMOTING THE EXPORT BY SMALL
AND MEDIUM ENTERPRISES FROM SECTOR “MANUFACTURE OF
WOOD AND OF WOOD PRODUCT, EXCEPT FURNITURE”
The carried out studies and analysis of the current situation of sector “Manufacture of wood
and of products of wood, except furniture” show that the sector has the potential to maintain its
importance for the national economy and to improve its positions on the international market.
The vision for the future of the sector, this strategies aims at, is:
Increase of the production share of the Bulgarian sector “Manufacture of wood
and of wood products, except furniture” on the international market
The increase in export activity of the SMEs from the sector will play a stimulating role for
the overall development of this important for the Bulgarian economy industrial sector.
For the vision realization it is necessary the efforts to be orientated towards the following
strategic and specific objectives:
Strategic objective 1 – Increasing the export potential of the Bulgarian SMEs of sector
“Manufacture of wood and of wood products”
One of the most serious challenges, the manufacturers from sector “Manufacture of wood
and of products of wood” are facing at home is the considerable growth of international
competition as a result of the liberalization of the world trade in the last years. The situation
created by the new world economy order proves that to be competitive in the international market
is not depending only on the advantages coming from cheap workforce. The competitiveness
depends on vast circle of factors, leading to good quality production at reasonable prices and
companies having high level of flexibility. On the other side the international markets situation,
although dynamic, shows the return of many Western European assignors, working until recently
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
in the Far East, towards the production on the Balkans and in particular towards our country.
Obviously this trend will be kept due to the necessity of prompt, precise and reliable supplies, as
well as of the small series production. The EU policy for keeping such production in Europe is also
favouring the sector development in Bulgaria, which promises good growth chances in the
following years. For the successful realization of Strategic objective 1, the implementation of two
specific objectives is established:
Specific objective 1 – Increasing the number of the SMEs of sector “Manufacture of
wood and of products of wood”, exporting goods to the world market
Specific objective 2 – Promoting the competitiveness of the SMEs of sector
“Manufacture of wood and of products of wood”, exporting goods to the world market
The implementation of Specific objective 1 and Specific objective 2 will lead to the
successful realization of Strategic objective 1.
Strategic objective 2 – Increasing the market share of the products of the Bulgarian
SMEs of sector “Manufacture of wood and of products of wood” on the world market
To expand the presence of Bulgarian enterprises of sector “Manufacture of wood and of
products of wood” on the world market there is need of tenacious and purposeful actions. The
approach to keeping existent markets and to entering into new ones is different. While sub-supplier
companies are traditionally working for leading companies mainly from the European Union,
attracting investments and to conquer new markets is related to a number of difficulties. To
overcome these difficulties there is need of State-supported joint actions of the Bulgarian
manufacturers.
This strategic objective will be realized by achieving the following specific objectives:
Specific objective 1 – Increasing the market share of the products of the Bulgarian
SMEs of sector “Manufacture of wood and of products of wood” on the existing markets
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Specific objective 2 – Entering of the Bulgarian SMEs of sector “Manufacture of wood
and of products of wood” into new markets
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
STRATEGY FOR PROMOTING THE SECTOR SMEs EXPORT
In order to achieve the set objectives different alternatives for development are possible.
Here, two main scenarios were evaluated, in particular:
1. Keeping the present structure of the public institutions, supporting the business,
especially the existing relationship between them and the export orientated SMEs
from sector ¨Manufacture of wood and of products of wood, except furniture”.
2. Change in the structure and transfer of functions for supporting the SMEs towards
units and forms, related to funding projects with EU funds and the State budget
according to the model of the Operational programmes or the Programme for
development of the rural regions.
The criteria to evaluate these scenarios are:
1. Possibility for the selected scenario to be realized within the frame of a 5-year
period.
2. Possibility to solve the issues related the supporting export orientated SMEs in other
EU countries.
3. Evaluation of the efficiency of the activities, related to supporting the business,
implemented by created to this exact end structures or by existing programmes,
granting support under the project principle.
The carried out analysis shows that:
The transition from the now existing system to a new one, on a project principle, will
require a period larger than 5 years. At the same time, now existing rules for the period up
to 2013 it is practically impossible, as the priorities and the main activities in the
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
operational programmes are clearly defined. For the next programme period 2014-2020
such an approach, if possible, is to be laid down in the negotiation process, but in fact
several years will be necessary its actual initiation, in the same way the OP in all EU
countries started for the period 2007-2013;
The selected in Bulgaria scheme through BSMEPA is preferred from the major part of EU
countries, where the success level is different in different countries, but there is no trend of
changes in the near future;
The reported difficulties in the business projects realization within operational programmes,
as for example “Competitiveness” show that the efficiency of promoting export orientated
SMEs, notwithstanding the critics at the moment due to lack of funds and good focusing, is
the relatively much better level than the results reached by the business through project
orientated measures.
Considering the above conclusions, the first alternative was chosen, namely – drafting of
Export strategy for the SMEs from sector “Manufacture of wood and of products of wood, except
furniture”.
In terms of the strategic perspective, the chosen alternative will require both general measures
for the whole system to support the SME, as for example increase of the institutions capacity,
introduction of clear and measurable indicators and criteria for evaluation of their work efficiency
and support to the business, etc. as well as specific changes, related in particular to the
“Manufacture of wood and of products of wood, except furniture”, as for example export
orientated work approach. As far as this was not an object of analysis and study of the present
strategy document, it would be probably a part of the elaboration of the institutional strategy of the
corresponding public administrations.
The present Export strategy for the SMEs from sector “Manufacture of wood and of products
of wood, except furniture” provides for the following principle steps, related to improving the
support of export orientated SME:
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Creation of the base for adequate and professional management of the processes of
supporting the export orientated SMEs through determining their possible scope – number
and characteristics of the export orientated SME, usage of the information from the drafted
profile, as well as of information from the business regarding the precise formulation of the
business needs of support, and of the created to this end institutions, as well as through
other forms, as for example the project principle, creation of a model for successful
communication with business to be supported.
Elaboration of the necessary programmes, policies and measure for support the SMEs to
export into foreign markets, through measures, designed to markets where to keep or
expand the existing positions, joint work with units, disposing of direct possibilities to
support export (for example foreign trade representatives and MEET), as well as measures,
having routine nature (for example), participation in fairs, missions, visits, etc.;
Measures, designed to certain deficits in export orientated SMEs, barriers for their
development in the field of export, as for example: support for the technology
modernisation of the SME in relation to improving their export positions, support for
creating export companies to help SMEs export; creation of State guarantees for export
insurance for SMEs, to complement and develop the now existing forms, advertising
campaigns for improving the image of the Bulgarian business, etc
Measures, designed to increasing the capacity of the SMEs, mainly through different
educational programmes.
Considering the deadlines of the Export strategy for the SMEs from sector “Manufacture of
wood and of products of wood, except furniture” the foreseen steps are realistic and would lead to
real results in supporting the export.
Important precondition for the realization of the set strategy is also the presence of political
will to ensure the necessary resources for its implementation.
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Due to the short-term 5-year horizon of the Strategy in the Action plan, the measures are
precisely formulated and divided into micro (enterprises), meso (branch organizations) and macro
(public institutions) level.
The foreseen funds are exemplary and tailored according to the actual possibility to
increase the BSMEPA budget. The prognosis for funds coming from Operational programmes
through the next programme period is too conditional, as there are no definitely adopted rules by
the EU. At the same time it is extremely important that BSMEPA and MEET to defend just
requirements for increasing the funds for development of the SMEs that are the backbone of each
economy.
Important precondition for the realization of the set strategy is also the presence of political
will to ensure the necessary resources for its implementation.
When drafting the present strategy the leading good European practices and the experience
of partners, organizations and institutions, having direct of indirect relations to the development of
the small and medium business, were observed.
Enclosed is a detail plan for the above described strategic development of the sector.
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
SEGMENTATION AND SUCESSFUL POSITIONING OF THE IDENTIFIED
EXPORT MARKETS
In the frame of the present export strategy are presented detail analysis of the sector, of the
development of the export of the various product groups; the markets are identified – the export
destinations for the SMEs from the sector within and outside the EU; information is given about
the main competitors on these markets and about the products with export potential, as well as
other key for the export activity of the SMEs information. The complex of analysis is serving as
foundation, the basis on which at micro-level each sector SMEs should perform segmentation of
the corresponding market and to determine adequate specific measures for the positioning of its
productions.
It is of key importance for the process of entering into new markets and to the ends of
achieving sustainability of the conquered market positions the determination of specific set of
promotional measures for the successful positioning of the products of the SMEs on the already
identified marketя, on the basis of the carried out surveys, analysis and evaluations.
The potential markets, identified as targeted ones for the sector, should be segmented, i.e.
to be divided into separate, the most homogenous possible groups of consumers that are defined as
market segments. The market segmentation would help export-orientated SMEs to develop and
offer such products, meeting to the greatest extent the specifics of the corresponding segments and
to provide targeted impact with appropriate marketing tools. Thus the available market potential of
the individual enterprise would be utilized in the best way.
Markets could be classified by a number of characteristics. Most frequently in the practice
are met the following classifications:
By geographical sign – local, community, national, regional, continental,
global;
By political and economic principle;
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
By commodity group of by concrete articles;
By the need the corresponding article of commodity group is satisfying;
By way of life – for examples luxury goods market, non-brand goods, etc.
One of the possible versions of the segmentation procedure is:
General definition of the market;
Consideration of the external restrictions (if such);
Selection of several indicators;
Determination of those of them, for which is possible to gather information
and surveys are carried out.
Selection of appropriate segment (target market)
By means of the market segmentation the corresponding SMEs from the priority
sector, object of the present export strategy, could define the perspective market
segments and to carry out the corresponding type of marketing, depending on
segmentation:
Non-differentiated marketing – aims at big, vast market by means of
marketing plan; it is related to the first stages of development of given
market through mass approach, where the consumers are alike.
Non-differentiated marketing – for the various market segments, different
marketing mix is applied;
Concentrated market – the concentration on the separate niche or segment
is determined by limited resources of the company or the impossibility to
satisfy different market segments.
The target market is a segment on which the product corresponds to the greatest
extent. The market window is a segment, the manufacturers are ignoring.
The market segmentation is one highly professional marketing activity, including
the normal combination of high risk level with likely high incomes, as a result of the full
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
coverage of the market. Not last, the risk is related to the long-term period, according to
which in practice is proved either the appropriateness of the taken decision for market
segmentation or the made mistake by choosing the approach of differentiated marketing.
Before coming to the positioning of a product or a brand, it is necessary to
perform market segmentation and to select the appropriate market segment. The
positioning strategy could be developed according to the following algorithm:
Figure 13 Development of the strategy for product positioning
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Positioning strategies
The development of the appropriate product positioning strategy means the companies to make
such an offer that is to take a dominating place in the consumers mind. To this end, the individual
SME of the sector is to perform the following steps:
1. Environment survey. It is done through studying and aims at gathering information for
the various segments.
2. Quality survey. It aims at measuring all important for the consumers’ product and market
characteristics.
3. Quality survey. It is based on the results of the quality survey and aims at measuring the
consumer adjustment towards the brand and its competitors.
4. Analysis. This stage is critical and depends on the manager’s experience. All marketing
and statistical analysis are applied.
2. Segmentation
3. Positioning. The company strategy is determined regarding the segmentation and
positioning, considering quality, quantity and accessibility of resources Segmentation is related to
the market and the positioning to the product and its placement in the segment. The product
positioning has two determinants – the ideal vision of the consumers and the perceived product
position.
Depending on which of the determinants the companies efforts will be focussed, two positioning
strategies can be distinguished:
1. Positioning, focusing on consumers. The main efforts of the company when choosing this
strategy are directed at creating maximum compliance between the actually perceived offer and the
ideal vision for the concrete product on the corresponding market segment. The aim is to shorten
the distance between them. Two strategies are possible thereto:
1.1. Strategy of juxta-positioning: The strategy consists in adapting the offered product to the
ideal vision thereof.
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
1.2. Strategy of pre-positioning. The strategy consists of adapting the relations of the consumers
to the position of the offered products.
The perceived positions of the already positioned in the consumers mind product is perceived by
the company as granted and efforts are made to change the ideal vision towards the existing
product.
2. Positioning, focusing on the competitor. The main marketing actions, directed to the creation
of such product position in the consumer mind, ensuring advantages in relation to the perceived
product positions of the consumers. This type of orientation could be done in two ways:
2.1. Strategy for profiling. It may be appropriate for the concrete export-orientated SMEs of the
sector, when it is possible to differentiate the competitor products. The strategy consists in the
searching of possibilities for isolated by the competitors positioning in the product space. The main
objective is to create relatively heterogeneous product-market combination in the frame of one
product space.
2.2. Strategy for imitating. The strategy is appropriate when there are homogeneous products,
which the consumers perceive as mutually replaceable and the most rational way for positioning is
to imitate the positions of the competitors. The advantages of the strategy are related with
expenditure saving, because the results of the competitors are used without any effort.
Ways of positioning
1. Positioning on the basis of the product characteristic
This approach is vastly widespread in the practice. It is based on the logical and objectively acting
relation between the client’s need and the product that is to satisfy certain specific necessity.
Therefore, on the basis of an expert study of the necessities and characteristics of their carriers –
the market clients, the marketing tools is orientated towards creation and strengthening of the
product advantages by means of given parameter that is by rule cleverly set in the advertising
message. It is in the basis of the specific competitive advantage in relation to the rest of the similar
products, offered by the competitors. The product positioning could be based on the ration between
certain parameters – for example quality and price.
2. Positioning on the basis of the product usage or application
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
In the process of positioning of a product in the consumer mind the attention may be focused as a
priority towards the way, the situation or simply the time of product usage. This approach too often
is supporting the other approaches aiming at the further expansion of the market.
3. Positioning on the basis of the characteristic of the product consumer
The usage of the relation between product and consumer as marketing approach for product
positioning is grounded and efficient for the objectives of entering and conquering good
differentiated market segments.
4. Positioning on the basis of the product order
Each product is part of a given product order and is satisfying specific necessity. Practice shows
that in number of cases the association, formed by the marketing efforts in the consumer mind in
relation of the product belonging to a certain product order, plays an important role for its
positioning.
5. Positioning in relation to the competitors
The usage of more or less open mentioning of the product advantages in comparative plan with the
competitors´ similar products is quite widespread marketing strategy for product positioning. This
approach is hiding essential risks in the condition of good regulated market economy and is to be
carefully applied by the SMEs. Here is paid attention to the market positions of given company as
precondition for the success of the positioning in comparison to the competition.
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Figure 14 Basic corporate strategies
BASIC CORPORATE STRATEGIES
DIFERENTIATION
EXPENDITURE
LEADERSHIP
FOCUSING
Approaches for
positioning through low
price
Approaches for
positioning by
benefit/problem/applicatio
n/usage/type of consumer
Approaches for
positioning by product
category; by product
characteristic;
competitive positioning;
by country of origin; by
relative price;
distribution positioning
through celebrities;
symbiosis
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
ACTION PLAN FOR SECTOR “MANUFACTURING OF WOOD AND OF PRODUCTS OF WOOD,
EXCEPT FURNITURE”
Table 21 Action plan
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
I. STRATEGIC OBJECTIVE 1
Increasing the export potential of the Bulgarian SMEs of sector “Manufacturing of wood and of products of wood”
1.1. Specific objective 1
Increasing the number of the SMEs of sector “Manufacturing of wood and of products of wood”, exporting goods to the world market
1.1.1. Drafting and update
of national strategy for the
sector development
2014 MEET 40 000 Operational
programme
Competitiveness
Developed and
adopted at national
level Strategy and
Action plan,
according to the
time schedule
National strategy
for the sector
development and
Action plan
thereto, that is
being
implemented.
Provided financial
resources for the
plan
implementation by
years;
Achievement of
the set objectives
Micro level: Granting
information, participation
in discussions and focus
groups
Companies
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
Micro level: Collaboration
at collecting and processing
information, participation
in discussion and focus
groups
Branch
organization
Meso level: Coordination
and organization of the
process of the overall
strategy development
BSMEPA
1.1.2. Elaboration of profile
of export-orientated
companies from the sector
2013 BSMEPA in
collaboration
with
(BBCWF)
5000 BGN
Budget of the
BSMEPA
Drafted criteria for
export-orientated
SME
Published criteria
Micro level: Participation
in the discussion of the
proposed draft of profile of
export-orientated
company.
Granting of information
Companies
Meso level: Participation
in the discussion of the
proposed draft of profile of
export-orientated company
Professional
organizations
Macro level: Organization
and coordination of the
process of creation of
BSMEPA
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
profile of export-orientated
company
1.1.3. Collection of
information (creation of
database) for export-
orientated companies of the
sector, including data
about:
- exporting companies
- those, having export
potential
2013 BSMEPA in
collaboration
with
(BBCWF)
10 000 BGN Part of the
general budget
funding of
BSMEPA
The database is
functioning
An accessible
database has been
created, where the
presence of given
company in the
database for the
export-orientated
companies is
included as a
criteria in the
evaluation for the
granting of funds
to support the
export and the
competitiveness
Micro level: Granting
information for the
database
Companies
Meso level: Support in
collecting and processing
the information
Professional
organizations
Macro level: Organization
and coordination of the
preparation and update of
the database
BSMEPA
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the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
1.1.4. Informing of foreign
traders and potential
investors for the existence
of the database mentioned
in p. 1.1.3 and granting
them access thereto
2014 BSMEPA in
collaboration
with Branch
Chamber
(BBCWF)
2 000 BGN Part of the
general budget
funding of
BSMEPA
Informed foreign
partners
500 e-mails sent,
information
published on the
UEA and BBCWF
sites
Micro level: dissemination
of information on
companies/partners level
Companies
Meso level: Collaboration
for the information
dissemination
Professional
organizations
Macro level: Information
dissemination on State level
BSMEPA/MEET
1.1.5. Informing the sector
SMEs on the possibilities of
support for their export-
orientation
Continuous BSMEPA 50 000 BGN
annually
Operational
programs
The BSMEPA
webpage is
transformed into
main source of
specialized export
information for the
sector SMEs.
Number of entries
in specialized
BSMEPA site
rubrics and
received feedback
Micro level: Participation
in information events
Companies
Meso level: Collaboration
for the information
dissemination and the
Professional
organizations
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
organization of information
events
Macro level: General
coordination and
organization of the process
of informing the SMEs
BSMEPA
1.2. Specific objective 2
Promoting the competitiveness of the SMEs of sector “Manufacture of wood and of products of wood”, exporting goods to the world
market
1.2.1. Update of the
development strategy for
sector “Manufacture of
wood and of products of
wood”
On annual
basis
BSMEPA,
Branch Chamber
(BBCWF)
15 000 BGN Operational
programmes,
Own capital of
the Branch
Chamber
(BBCWF)
An updated sector
strategy leads to
the promotion of
the competitiveness
of the sector SME
The measures on
the development
strategy update are
being
implemented
Micro level: Granting the
necessary information,
including participation in
opinion polls and focus
groups
Companies
Meso level:
Granting the necessary
information, including
participation in opinion
polls and focus groups
Professional
organizations
Macro level: Organization BSMEPA
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
and coordination of the
process of development and
officialization of the
strategy and the action
plan, as well as their
implementation process
1.2.2. Support for the
creation/development of
export orientated
consortium in the sector
2013-2014 Branch Chamber
(BBCWF),
BSMEPA
100 000 BGN
annually
Funds of the
BSMEPA and
operational
programmes
The export unit is
supporting the
export activity of
the sector SMEs
Export unit
created
Micro level: Willingness
for participation in export
orientated consortium
Companies
Meso level: Participation in
the creation and
development of export
orientated consortium
Promoting the
participation of SMEs in
such consortiums,
especially through ensuring
expert assistance when
applying for grants
Professional
organizations
Macro level: Assisting the
creation/further
development of export
orientated consortium
BSMEPA,
MEET
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
Promoting the
participation of SMEs in
such consortiums
1.2.3. Drafting a
programme for increasing
the number of SMEs,
certified under
internationally recognized
standards (including
introduction of the so
called Chain of Custody
(CoC) certification
2014 BSMEPA,
MEET
According to
the announced
grant schemes
OP
Competitiveness
The Bulgarian
SMEs meet the EU
standards for
quality, working
conditions and
environmental
performance.
Number of SME,
having introduced
EU standards
Micro level: Development
of proposals for funding
activities on introducing
quality management
systems and other
internationally recognized
standards
Companies
Meso level: Encouraging
the SMEs participation in
projects under the
operative programmes for
the next programme period
to the ends of introduction
of systems for quality
management and other
Branch
organizations
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
internationally recognized
standards
Macro level: Development
of programme for
increasing the number of
companies, having
introduced systems for
quality management and
other internationally
recognized standards.
Management of the overall
grant funding process and
monitoring of the results
MEET
1.2.4. Transformation of
the export and import
potential of the SMEs into
leading criteria when
evaluating projects under
OP “Competitiveness”
If possible
BSMEPA
Created evaluation
criteria with bigger
relative weight of
export
5 additional points
for export-
orientated
companies
Micro / Meso level: Active
participation in the
development of the
proposals for increasing
the weight of the evaluation
for the companies’ export
orientation within the total
score for receiving a grant.
Companies,
Professional
organizations
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTA
TION
INDICATORS
Macro level: Drafting of
proposals for increasing
the weight of the evaluation
for the companies export
orientation within the total
score for receiving a grant.
BSMEPA
1.2.4. Ensuring State
guarantees for the SMEs
export insurance (Macro
level)
2014 BAEI 30 000 Budget of the
institution,
Operational
programmes in
the next
programming
period
Increasing the
number of SMEs
and the volume of
the export of the
sector, thanks to
the improved
mechanisms for
export insurance
Number of
ensured export
deals of the SMEs
Macro level: Creation of
mechanisms for granting
state guarantees for export
insurance in the frame of
OP for the following
programme period
Granting state guarantees
for export insurance in the
frame of OP for the
following programme
period
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
OBJECTIVES AND
MEASURES
IMPLEMENT
ATION
DEADLINE
RESPONSIBLE
INSTITUTIONS
NECESSARY
FINANCIAL
RESOURCES
FUNDING
SOURCES
EXPECTED
OUTCOME
IMPLEMENTATIO
N INDICATORS
1. STRATEGIC OBJECTIVE 2
Increasing the market share of the products of the Bulgarian SMEs of sector “Manufacture of wood and of products of wood” on the
world market
2.1 Specific objective 1
Increasing the market share of the products of the Bulgarian SMEs of t sector “Manufacture of wood and of products of wood” on
existing markets
2.1.1. Support for the
participation of the
sector SMEs in
international and
national exhibitions and
fairs
FURNIWOOD
CHINA (Beijing,
China) –
international
exhibitions for
furniture
accessories, wood
materials and
articles, celebrated
every two years;
FURNIMA
(Thessalonica,
Greece) –
Continuous MEET,
BSMEPA
2 000 000 Budget of
BSMEPA, OP
Competitiveness
Drafted annual
programme for the
exhibition and fairs,
important to the
sector manufacturers
Number of SMEs,
having taken part
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
International
exhibition for
machinery, raw
material, tools,
accessories and
equipment for
furniture
manufacture,
celebrated every
two years;
ARREDO
(Bolzano, Italy) –
exhibition for
furniture,
celebrated every
two years;
SOUTHPACK
(Charlot, USA) –
exhibition of the
leading suppliers of
packing machinery,
products for
material processing
and services,
packing materials,
packaging and
outsourcing
services.
Micro level:
participation in
Companies
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
international and
national exhibitions and
fairs
Meso level: Assistance
for the organization of
the Bulgarian
participation
Professional
organizations
Macro level:
organization of the
Bulgarian participation
and follow-up of the
outcomes
BSMEPA/MEET
2.1.2. Creation of
mechanism to support
the visit and
participation of foreign
trade partners in
specialized exhibitions
in Bulgaria
2013-2014 BSMEPA and
the professional
organizations
50 000 BGN Budget of
BSMEPA and
BBCWF or of
Companies,
wanting to take
advantage of
this measure
Signed export
contracts due to the
participation of
foreign trade
partners.
Yearly increase in
the number of signed
export contracts with
invited foreign trade
partners.
Micro level: Granting
information to foreign
partners
Companies
Meso level: Assistance
in ensuring funds for
such events
Professional
organizations
Macro level: Assistance
in ensuring funds for
such events
BSMEPA
2.1.3. Creation of 2013 BSMEPA, 20 000 BGN Budgets of Elaborated and At least 1 specialized
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
programme for more
active interaction with
the Bulgarian trade
representations abroad
for receiving current
market information
MEET and MFA BSMEPA and
MFA
functioning
interaction
programme
information message
per month is given to
the Branch Chamber
for dissemination
among export-
oriented sector SME
Macro level:
Development of draft
programme for more
active interaction with
the Bulgarian trade
representations abroad
for receiving current
market information
Officializing and
application of the
programme
BSMEPA
2.1.4. Elaboration and
realization of
programme for
qualification of export
specialists from the
sector SMEs.
2014-2020 BSMEPA and
Higher education
institutions
50 000 BGN
annually
Budget of
BSMEPA and
operative
programmes
Over 1000 export
specialists from the
SMEs trained within
the programme
period.
Number of trained
export specialists.
Micro level: Granting
information about the
needs of training
Participation in
trainings
Companies
Meso level:
Development of
Professional
organizations
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
training programmes
Encouraging the SMEs
to take part in trainings
Celebration of the
trainings
Macro level:
Organization and
coordination of the
process of development
and implementation of
programmes for
increasing the
qualification of export
specialist in the SMEs
BSMEPA
2.2 Specific objective 2
Entering of the Bulgarian SMEs of sector “Manufacture of wood and of products of wood” into new markets
2.2.1. Preparation and
celebration of
advertising campaigns,
representing the
potential and the
advantages of the sector
SMEs as trade partners
abroad
Continuous
BSMEPA 100 000 BGN
annually
Budget of
BSMEPA,
operative
programmes
and BBCWF
The sector
companies are
known as potential
partners on new
markets
At the min. 5
presentations
annually in different
countries – target
markets, 1
informative internet
portal, 5 paid
publications in
foreign press
annually
Micro level: Granting
information for the
Bulgarian products and
services
Companies
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Meso level: Granting
information for
products and
manufacturers;
assistance in the
creation of specific
advertising campaigns
Professional
organizations
Macro level:
Coordination of the
process, as well as by
including commercial
attaches to the
Bulgarian diplomatic
missions abroad
BSMEPA
2.2.2. Development of
programme for training
specialist of the sector
SMEs and of the
branch organization to
take part in specialized
domestic and foreign
exhibitions
2014 BSMEPA and
Higher education
institutions
20 000 BGN
annually
Budget of
BSMEPA
Working
programme for
training specialists
of sector SMEs and
branch organization
to participate in
specialized domestic
and foreign
exhibitions
100 specialist from
the sector SMEs per
year have undergo a
training on
participation in
specialized domestic
and foreign
exhibitions
Micro/meso level:
Granting information
about the needs of
training
Participation in the
trainings
Companies
Professional
organizations
Macro level: BSMEPA
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Organization and
coordination of the
process of creation and
implementation of the
programme for training
of specialist
2.2.3. Elaboration of
criteria for selection of
markets and for
development of export
analysis
Periodically BSMEPA and
Branch
organization
(BBCWF)
5 000 BGN
annually
Budget of
BSMEPA and
Branch
organization
(BBCWF)
Relieved selection
of target markets in
new regions –
Persian gulf, CIS
countries
Elaboration of 1
handbook, updated
once per year
Micro level:
Participation in
discussions and focus
groups for the criteria
development
Companies
Meso level:
Participation in
discussions and focus
groups for the criteria
development
Professional
organizations
Macro level:
Coordination and
organization of the
process on developing
the criteria
BSMEPA
2.2.4. Issuing periodic
brochures and reports,
containing information
about international
Periodically Branch Chamber
(BBCWF)
50 000 BGN
annually
Budget of
BSMEPA
and
Branch
Increased level of
information of the
sector SMEs
managers regarding
Monthly brochure
with information
about international
markets and two
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
markets Chamber
(BBCWF)
export opportunities semi-annual reports
with more in-depth
analysis are provided
to the export-
orientated sector
SMEs
Micro level: Granting
information
Companies
Meso level: Support in
collecting and
processing the
information
Professional
organizations
Macro level:
Coordination of the
information processing
process, the creation of
the final product and its
dissemination
BSMEPA
2.2.5. Organization of
seminars for
acquaintance with the
specific requirements of
the corresponding
markets EU, Russia,
CIS, USA, Arab region,
etc.
Periodically BSMEPA
and
Branch Chamber
(BBCWF)
20 000
BGN/annually
Budget of
BSMEPA
and
Branch
Chamber
(BBCWF)
Better knowledge of
the specific
requirements of the
corresponding
markets by the
sector SMEs
managers
Micro level: Active
participation at such
events
Companies
Meso level: Support in Professional
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
the information
organization and
preparation
organizations
Macro level: Seminars
organization and
realization
BSMEPA
2.2.6. Purchase and
granting of information
for the identified target
markets by BSMEPA
Continuous BSMEPA Own funds,
operational
programmes
Available and
adequately
processing
information for the
identified target
markets
Easy and
unconditional access
to information for the
identified target
markets
Micro level: Submitting
data for the database
Companies
Meso level: Submitting
data and analysis
Professional
organizations
Macro level: Creation
of database with
potential partners and
information about
external markets
Coordination of the
overall database
maintenance process
and its timely update
BSMEPA
2.2.7. Provision of
budget funds for
creation of networks for
supporting the small
and medium business
Continuous MF, MEET 1 000 000
BGN annually
State budget,
OPC
Horizontal and
vertical cooperation
in networks for
collaboration and
support of SME
Number of created
formal and informal
networks and
structures; number of
SME taking part
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
MONITORING AND CONTROL SYSTEM
For each strategic document it is of great importance: first - to be elaborated according to
predetermined goals, deadlines and resources; second - to show stability over the time and to
enforce the activities and effects built into it. To this end, it is advisable to monitor
(monitoring) and evaluate the implementation of the document and to identify appropriate
actions – to remedy and improve the activities set out therein.
Monitoring can be defined as: (a) an integral part of an ongoing project management
(which is considered to be the realisation of an Export strategy for sector “Production of
transport vehicles, excluding cars”, aiming to achieve any change – in this case, improving the
export activity of SMEs in the sector); (b) an instrument facilitating the control over the
management and the process of decision making; (c) a description of events and conditions
within a specified period of time; (d) systematic collection of reliable, up-to-date and relevant
information on the progress, changes and consequences of all programming action taken. These
essential features of the monitoring itself define it as one of the most important components of
the management of strategic documents, programs, projects, etc.
Assessment, in turn, is a systematic review of specific management activities to provide
information about the full range of short and long term effects on consumers. Programme
evaluation may include assessment of workload, operating procedures, or personnel, but its
main purpose remains the effect and impact of programme’s implementation (strategic
document).
Monitoring should therefore establish the status and monitor the progress in
implementing various components and subcomponents and thus - the Strategy as a whole.
Monitoring should also identify arising problems, the factors determining these problems and
suggest possible measures and solutions to these problems. The information obtained is
expected to be timely made available to the responsible authority (primarily MEET and
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
BSMEPA). The meaning of this is to enable those authorities and other relevant government
agencies, at their discretion, to take timely "corrective actions" to facilitate achieving the
strategy objectives.
It should be noted that while monitoring focuses on monitoring the: (a) actions taken
and resources expended, (b) results achieved, (c) process progress over the time, (d)
achievement of the effects, the assessment aims at identifying the extent to which the general
and specific objectives of the document are achieved, and also includes a systematic review of
specific management operations to provide information about the full range of short and long
term effects.
The main points that should be observed in connection with the implementation of this
strategy are:
- Adhering to the pre-set schedule of activities;
- Volume, rate and extend to which resources have been used;
- Results achieved;
- Achievement of objectives and strategic document impact.
When to monitor? - The goal of the current monitoring is to record the effects and the
deviations from the planned figures early enough so as to allow their correction before the
consequences of these effects become so serious that they can not be overcome. What should
not be forgotten is the need for monitoring to be performed frequently enough in order the
deviations from the set plan to be adjusted.
Based on this methodology, the monitoring and assessment, necessary for the fulfilment
of this Strategy, suggest the following succession of activities:
1. Selection of criteria and indicators for monitoring and assessment;
2. Monitoring the implementation;
3. Comparing results with the target state;
4. Proposing and taking corrective actions.
According to the adopted goals and measures set forth in the strategy, we propose the
following main indicators for monitoring and assessment:
Published criteria the SME and their production for initiating export are to comply
with;
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Created accessible database for export orientated companies, where the presence of
given company into the database is included as a criteria when making an assessment
for granting funds to promote the export and the competitiveness;
Number of entrances into specialized rubrics of the BSMEPA website and received
feedbacks;
Availability of update strategy for development of sector “Manufacture of wood and
of products of wood, except furniture” and implementation of the measures, included
therein;
Number of SME, having introduced systems for quality management, working
conditions and environment management (ISO 9001, ISO 14001 and others);
Number of patented articles by SMEs from the sector;
Number of companies exporters, using the guarantees for export insurance;
Number of participation by sector SMEs in international and national fairs and
exhibitions;
Created at least 3 clusters;
Increase in any following year of the signed export contracts with the invited foreign
trade partners;
Number of trained specialists in the sector;
At least 5 presentations per year in different countries – target markets, 1 information
internet portal, 5 paid publications in foreign media per year;
100 specialist from the sector SMEs yearly have undergo a training on participation in
specialized exhibitions in the country and abroad;
Drafted 1 guide for promoting the export of the SMEs, reflecting the possibilities for
export and the condition of the market conjuncture, updated once per year;
At least 2 seminars per year should be organized for presenting the specific
requirements for the defined key markets in and outside EU;
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
Progress surveillance and monitoring shall be carried out by BSMEPA, which is the
“owner” of the Strategy, and it shall appoint an official, from its administration, which shall be
responsible for collecting information in order to facilitate the monitoring of the
implementation of measures and who shall report on an annual basis to the Executive Director
of the Agency.
The annual reports shall serve as interim evaluations of the fulfilment of the Strategy.
At the end of year 2020 it shall be prepared a final report covering the entire period of the
Strategy.
These reports are public. The results shall be disclosed to the public
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Operational programme “Development of the competitiveness of
the Bulgarian economy” 2007-2013, Priority axis 4.2.
“Promoting the internationalisation of the Bulgarian enterprises”
Project № BG161РО003 – 4.2.01-0001 “Promotion Of the
Internationalization of the Bulgarian Enterprises”
BIBLIOGRAPHY AND STATISTICAL SOURCES
1) Member States competitiveness performance and policies – EK, document SEC
(2010)1272, accompanying strategy “Integrated industrial policy for the globalization era.
Competitiveness and sustainability at front page”.
2) National programmes for reforms (2011 – 2015) of the Republic of Bulgaria (In
implementation of strategy Europe 2020) – CM of the RB, Sofia, 13th
April 2011.
3) Research, innovation and competitiveness package, proposal for a Regulation of the
European Parliament and the Council, establishing a Programme for the Competitiveness of
Enterprises and small and medium-sized enterprises (2014-2020), Brussels, 30.11.2011,
COM (2011) 834 final
4) Methodology for strategic planning in RB – Council for administrative reform at the CM of
the RB, Sofia, April 2010
5) Bases of Economics – Gillespie, Andrew, 2 iss., Oxford University Press 2011
6) Industrial policy: strengthening the competitiveness – EC, Brussels, 14.10.2011; COM
(2011) 642 final
7) Classification of the economic activities (CEA 2008) – NIS, Sofia 2008
8) Innovations. BG – Foundation “Applied studies and communication”, Sofia
9) Small Business Act for Europe (Think for small) – EK, Brussels, 25.6.2008; COM (2008)
394 final
10) Analysis of the condition and factors for development of the SME (The Bulgarian SME in
conditions of crisis) – NOEMA, BSMEPA, Sofia 2011
11) For the development of the present strategy the following statistical data and documents,
that are publicly available, have been consulted:
a. NIS
b. Eurostat
c. MEET
d. WTO (UN)
e. International trade centre, Geneva
f. Data and publications of the BCC, BTIC, BCCMB
g. Information from the sociological survey carried out in the period 31 October –
28 November 2011 with the management personnel of micro, small and
medium-size enterprises of the analyzed sector
h. Other official information electronic sources