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R E P U B L I C O F B U L G A R I A
Bulgarian Small and Medium Enterprises
Promotion Agency
PROJECT BG161РО003 – 4.2.01-0001, “PROMOTION OF THE
INTERNATIONALIZATION OF THE BULGARIAN ENTERPRISES”
Проект № BG161РО003 – 4.2.01-0001, „НАСЪРЧАВАНЕ НА
ИНТЕРНАЦИОНАЛИЗАЦИЯТА НА БЪЛГАРСКИТЕ ПРЕДПРИЯТИЯ”
This project is financed by the European fund for regional development through
an Operational programme “Development of the competitiveness of the
Bulgarian economy” 2007 – 2013
Този проект е получил финансиране от Европейския фонд за регионално
развитие чрез Оперативна програма „Развитие на конкурентоспособността
на българската икономика” 2007 – 2013
EXPORT STRATEGY
Manufacture of Chemical and
Pharmaceutical Products
June 2012
2
LIST OF ABBREVIATIONS
EU European Union
BSMEPA Bulgarian Small and Medium Enterprises Promotion Agency
MAF Ministry of Agriculture and Food
MEET Ministry of Economy, Energy and Tourism
MRDPW Ministry of Regional Development and Public Works
CM Council of Ministers
SME Small and Medium Enterprises
ITC International Trade Centre
NCEA National Classification of Economic Activities
NSI National Statistical Institute
OP Operational Programme
OTEA Office of Trade and Economic Affairs
3
TABLE OF CONTENTS
INTRODUCTION ...................................................................................................................... 4
1. APPROACH FOR DEVELOIPING THE EXPORT STRATEGY .................................... 5
2. MAIN CONCLUSIONS FROM THE ANALYSIS OF THE CURRENT AFFAIRS ..... 11
3. SWOT AND LOED ANALYSES OF THE EXPORT PROCESS OF SMEs IN SECTOR
“MANUFACTURE OF CHEMICAL AND PHARMACEUTICAL PRODUCTS” ............... 32
4. OBJECTIVES ................................................................................................................... 35
5. STRATEGY TO PROMOTE EXPORT OF SMEs IN THE SECTOR ............................ 36
6. ACTION PLAN ................................................................................................................ 38
7. MONITORING AND CONTROL SYSTEM ................................................................... 48
4
INTRODUCTION
The export strategy of sector “Manufacture of chemical and pharmaceutical products” is
developed under Project № BG161РО003 – 4.2.01-0001 “Promoting the internationalization
of the Bulgarian enterprises”, Priority Axis 4 “Strengthening the international market
positions of Bulgarian economy” of Operational Program "Development of the
Competitiveness of the Bulgarian Economy", pursuant to contract BG-161PO003-4.2.01-001-
C00001 for providing direct grants under which the Bulgarian Small and Medium Enterprises
Promotion Agency (BSMEPA) is an institutional beneficiary.
The goal of the Export Strategy for sector “Manufacture of chemical and pharmaceutical
products” is to provide support to the Bulgarian micro, small and medium-sized enterprises
in the sector to enhance their competitiveness, degree of internationalization and entering or
expanding the market positions of the Bulgarian products and particularly of these with higher
value added.
The Bulgarian state, represented by BSMEPA, MEET and other state institutions has
identified the SME sector as particularly sensitive and at the same time as having crucial
importance for economic life, deserving special attention. The diversity in the development of
different economic sectors and the place of SMEs therein, as well as the national priorities
related to the promotion of national exports, require the development of export strategies for
particular sectors, one of them being the sector of “Manufacture of chemical and
pharmaceutical products”. Focusing of the support and defining of precise benchmarks for
state intervening through its institutions, on the one hand, and providing options for
development to other participants in the process, on the other, will strengthen in a positive
way the planning aspect of state activities and will at the end improve the performance of the
sector. The successful implementation of the Export Strategy is expected to result in
improvement of the process of going international and of the active expanding and
strengthening of market positions of Bulgarian SMEs producing chemical and pharmaceutical
products.
In developing the Export Strategy, the findings and conclusions of researches of existing
strategic and normative documents are taken into account, as well as the "Methodology for
Strategic Planning" prepared by the Council for Administrative Reform to the Council of
Ministers of the Republic of Bulgaria.
5
1. APPROACH FOR DEVELOIPING THE EXPORT STRATEGY
The Export Strategy is a strategic document, which defines the medium-term goals and
priorities of the export development of SMEs in sector “Manufacture of chemical and
pharmaceutical products”. It is developed on the basis of the strategic planning approach, the
skillful implementation of which has the following advantages:
Creates an understanding among stakeholders on the trends and prospects for the future.
Establishes a common vision and consensus among stakeholders, by coordinating
different initiatives in the selected targets.
Identifies already undertaken or planned projects and actions.
Strengthens partnership between government, business and other parties to solve complex
problems.
In developing such a strategic document, it is of crucial importance to formulate properly the
"owner" of the strategy, i.e. the institution or institutions who will be responsible for the
overall implementation of the strategic document as well as for the different stages of
strategic planning.
In general, the development of strategic documents includes the following stages:
Assignment
Preparation
Development
Coordination
Approval
Implementation
Evaluation
Updating
Each of these stages contains specific activities, some of which, such as assignment,
preparation, development, coordination, approval and, at a later period, updating, are part of
the project implementation under the contract mentioned above. Therefore, the principal
“owner” of the export strategy is the Bulgarian Small and Medium Enterprises Promotion
Agency (BSMEPA). For this reason, the goals, measures and actions set in the strategic
document must first help BSMEPA improve the planning and implementation of activities
related to the support of exports of SMEs in sector “Manufacture of chemical and
pharmaceutical products”. This formal logic does not contradict to the fact that a significant
number of institutions, businesses and even the population are involved as stakeholders and
they might be influenced by means of different mechanisms, for example, the state
institutions – through the forms of coordination of strategic documents of such rank, and the
branch associations and businesses – by providing incentives to increase their export
potential. It is of extreme importance for SMEs in the sector of “Manufacture of chemical and
pharmaceutical products” to be able to see a clear and predictable export supporting state
policy, which, though in the medium run, will allow them to decide whether to benefit or not
from the created opportunities.
6
Technology of strategic planning used for the preparation of the export strategy for
sector "Manufacture of chemicals and pharmaceutical products"
The process of strategic planning includes the following steps:
Identification of interested parties (stakeholders)
Analysis of the environment
SWOT analysis
Vision
Goal setting
Selection of an alternative – development strategy
Action plan
Monitoring system
Each of these steps has its specific features, namely:
Identification and involvement of interested parties (stakeholders). Interested party is any
person or group that demands attention, may influence a certain decision, may contribute by
resources or be affected by a certain decision. Involving stakeholders at an early stage of the
strategic document can lead to a stronger consensus on goals and a greater willingness to
support decisions. Stakeholders of the Export Strategy may involve various persons and
organizations, such as companies, state institutions, producers’ associations, businesses,
consumers of the products, NGOs and experts.
In preparing the strategy for sector "Manufacture of chemicals and pharmaceutical products",
the specific rule of non-discrimination was accounted for, i.e. do not assist some businesses at
the expense of others on the basis of subjective assessments and motives. This is the reason
why there was a pursuit for equality when involving business organizations and different
branch associations, as well as a search for an opportunity that the majority of businesses
could benefit from the analysis made.
Analysis of the environment. The analysis of the environment (the conclusions of which
serve as a basis for the SWOT analysis) allows the formulation of goals and priorities for
sector "Manufacture of chemicals and pharmaceutical products" which shall align the efforts
and shall not be dissociated from time and environment.
Analyses are focused on:
Current state of affairs of sector "Manufacture of chemicals and pharmaceutical
products" in Bulgaria, trends, dynamics and growth;
Characteristics of export oriented SMEs in sector "Manufacture of chemicals and
pharmaceutical products", incl. regional distribution;
State of the exports of goods and services from sector "Manufacture of chemicals and
pharmaceutical products";
Analysis of goods and services with export advantages or export potential produced by
the sector;
Estimation of productions of chemicals and pharmaceuticals with the highest value
added growth potential in the export of goods and services in which Bulgaria has a
global market share;
7
Size of the international market of sector "Manufacture of chemicals and
pharmaceutical products";
Competitiveness of exports of goods and services, for existing and for potential
foreign markets;
Share of products of chemical and pharmaceutical industry with origin from Bulgaria;
Share of the Bulgarian exports of product group “Chemicals and pharmaceuticals” in
total imports on the global market;
Leading importers in sector "Manufacture of chemicals and pharmaceutical products";
Value and volume of imports on certain foreign markets for a specified product group
“Chemicals and pharmaceuticals”;
Main suppliers on a certain market;
Identification of barriers to internationalization of enterprises in the sector and
measures for their overcoming.
Based on these analyses, the current problems and achievements of sector "Manufacture of
chemicals and pharmaceutical products" shall be clearly defined, and some forecasts,
opportunities and prospects for development shall also be motivated, such as:
Achieving a significant growth of Bulgarian goods in total, and particularly of those
with higher value added;
Identification and prioritization of target markets by commodity groups;
A forecast of exports and imports of goods and of trade balance in the next five and
more years.
Analyses are based on existing analytical and program documents, available statistical
information and information from conducted surveys – interviews and focus groups.
The analysis of the environment describes the current situation of SMEs in the sector and the
export process, establishes the reasons that cause developmental problems, and sets the
guidelines for future development.
SWOT analysis. SWOT analysis allows the identification of the main internal factors defined
as “strengths and weaknesses” and the main external factors, defined as “opportunities and
threats”, and it also assists the formulation of strategic goals, priorities and measures. Using
SWOT analysis prevents the setting of unattainable goals and priorities for export
development of SMEs in “Manufacture of chemicals and pharmaceutical products” over the
period of the Strategy.
Using SWOT analysis in the development of the Export Strategy has some specifics, as
though BSMEPA is the strategy “owner”, the analysis is focused on the export process of
SMEs in sector “Manufacture of chemicals and pharmaceutical products” and not the
institution itself.
LOED analysis. LOED analysis is an instrument used to show how to build on strengths, to
overcome weaknesses, to seize opportunities and to protect against the threats identified by
the SWOT analysis.
Goal setting. Strategic planning focuses on critical issues, opportunities and problems faced
by the export of SMEs in sector “Manufacture of chemicals and pharmaceutical products”. It
helps to distinguish really important decisions from decisions with temporary effects.
8
Goal setting, by establishing a hierarchical tree of goals, is a working tool that allows
detailing of the most common general goals to specific ones.
Defining of the general strategic goal is particularly important for the future development of
exports of SMEs in the sector as it reflects the view of institutions and business for the future.
The general strategic goal seeks to answer a single basic question: How should the export of
SMEs in sector “Manufacture of chemicals and pharmaceutical products” look like in the
long-term period according to the main institutions and stakeholders?
Reaching the level of specific goals makes it possible to answer the questions about “who”,
“what” and “when”, so as to guarantee attaining of the goals set higher in the hierarchy.
Selection of an alternative – a development strategy. Once objectives are defined, ways are
sought how to achieve them. Experience shows that this can be done in different ways, which
represent different alternatives for development and achievement of the objectives. At this
stage of strategic planning, different alternatives are evaluated from different perspectives and
criteria, and as a result, an alternative is selected which then becomes a strategy for the
development of exports of SMEs in sector “Manufacture of chemicals and pharmaceutical
products”.
Action plan. The selected strategy shall be supported by certain actions and measures, which
are linked to terms, supervisors, performers and financial resources. The Action plan and the
related measures therein transform this strategic instrument into daily work and
implementation of the policy for supporting the export of SMEs in “Manufacture of chemicals
and pharmaceutical products”.
Monitoring system. The last stage of the strategic planning process is monitoring and
evaluation of the progress in implementing the general and specific goals set in the export
strategy and in the Action plan for SMEs in sector “Manufacture of chemicals and
pharmaceutical products”. Monitoring is important as it allows taking corrective actions,
provided that progress is unsatisfactory or conditions change. It is also important that the
progress in achieving general objectives is reported to the public and the business, so that they
can estimate the work of relevant institutions and stakeholders in the implementation of the
strategy. It should be noted that often the effects may not be visible or apparent, which
hampers their measurability. Moreover, the impact is often a cumulative effect, and this may
complicate further the analysis. This gives particular weight to monitoring, which is closely
related to all stages of implementation of the Export Strategy - preliminary (ex ante), current
(parallel with implementation) and subsequent (ex post) evaluation.
In order to exercise monitoring of the implementation of the export strategy and to evaluate
performance against the defined targets, it is necessary to use a set of indicators which should
be determined in advance or early enough regarding the implementation of the strategic
document, so as to use data received on them. In most cases, these will be targeted values
which in aggregate will correspond to the goals of the strategic document.
Monitoring provides the feedback that helps to assess the success or failure of the planning
document.
To perform the monitoring process, it is necessary to determine:
Monitoring indicators (what will be observed);
Frequency of monitoring and evaluation (when the relevant reports will be
prepared);
9
Responsibilities for monitoring and evaluation (who does what) and
competences for decision-making to change (updating of the strategic
document).
INFORMATION SOURCES
The following main information sources have been used in developing the export strategy:
- National Statistics Institute
- Information provided by BSMEPA
- Information from MEET
- Eurostat
- International Trade Centre
- Experts’ publications
- Information published in connection with international forums and meetings
- Official electronic information resources
- Information published by branch organizations of the sector
- Information from the Bulgarian Industrial Association and the Bulgarian Chamber of
Commerce and Industry, and their regional divisions
- Information from a survey conducted in the period 31 October to 28 November 2011
with the senior management of 4 micro, 7 small and 9 medium (total of 20) enterprises
operating in the sector, and from a focus group.
Information is processed with the will for maximum objectivity of the findings. In many
cases, the analyzed information applies to sector “Manufacture of chemicals and
pharmaceutical products” as a whole, i.e. the information covers both SMEs and large
enterprises, based on the assumption that if a Bulgarian company has been successful on
certain markets, the same could be expected for another company as well, incl. from the
group of SMEs. These specifics are explicitly emphasized during the analysis.
10
STRUCTURE OF THE EXPORT SECTOR STRATEGY FOR "MANUFACTURE
OF CHEMICALS AND PHARMACEUTICAL PRODUCTS"
The structure of the Export Strategy for sector “Manufacture of chemicals and pharmaceutical
products” is based on the strategic planning approach which sets the general parameters of the
strategic document. At the same time, a study was made of the structure of other institutional
strategic documents, and they were estimated with regard to the following criteria:
- providing opportunity for relatively easy access to the document through
understandable and logical structuring of different parts;
- presenting the content in an attractive and easy-to-understand manner accessible to
non-specialists as well;
- providing information thematically, i.e. structuring the material in a way that allows
in-depth penetration of problems and analyzes only if desired by the reader.
The above mentioned criteria were met by several of the studied strategies and they contained
two clearly distinguished separate parts, namely:
1. A main document, in which according to the above described technology of strategic
planning the separate chapters are defined.
2. Appendices that contain the complete text of the analysis, including conclusions,
transferred to the main document.
This approach was chosen in structuring the Export Strategy for sector “Manufacture of
chemicals and pharmaceutical products”. Following consultation with stakeholders, the initial
approach was slightly altered, as findings and conclusions in the main document were
supplemented with specific data and visualized with graphs and diagrams, thus relieving users
who do not intend to go in depth of the analyzes included in the Appendices.
11
2. MAIN CONCLUSIONS FROM THE ANALYSIS OF THE
CURRENT AFFAIRS
This part contains the conclusions of different analyses, included in “Analysis of the
environment” in sector “Manufacture of chemicals and pharmaceutical products”, which is
one of the main steps in the technology of strategic planning. In appendix to this strategic
document, the complete text of data and analyses is presented, on which basis the respective
conclusions are drawn. The conclusions and the analyses themselves are structured in 6 parts,
namely:
STATE AND DEVELOPMENT OF THE SECTOR IN BULGARIA
EXPORT ORIENTATION OF THE SECTOR
GOODS AND SERVICES WITH EXPORT ADVANTAGES AND
POTENTIAL
COMPETITIVENESS OF EXPORT OF GOODS AND SERVICES ON
FOREIGN MARKETS
EXPORT PRIORITY PRODUCT GROUPS AND MAIN MARKETS
BARRIERS TO THE INTERNATIONALIZATION OF SMALL AND
MEDIUM ENTERPRISES AND MEASURES FOR THEIR OVERCOMING
Conclusions are clearly structured according to the scope of the analysis, as first are presented
those valid for the whole sector, incl. large (according to the classification) enterprises, and
second come the conclusions regarding small and medium-sized enterprises in the sector.
STATE AND DEVELOPMENT OF THE SECTOR IN BULGARIA
General for sector "Manufacture of chemicals and pharmaceutical products”
Note: December of the year, 2005=100; Source: NSI.
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Index of Industrial Production
Manufacturing 71,7 79,3 92,8 106,5 118,2 131 132,6 114,4 96 103,3
Manufacture of chemical
products
72,5 72,4 81,3 93,7 108,7 104,6 116,8 90,6 90 93,6
Manufacture of medicinal
substances and products
107,9 107,6 116,6 109,6 107,1 135,2 94,8 103,9 93,4 91,2
Turnover Index on the domestic market
Manufacturing 75,6 82,5 88,8 110 122,4 144 155,7 157,4 135,6 136,9
Manufacture of chemical
products
79,0 76,7 81,9 111,0 110,3 132,6 179,9 177,1 172,3 176,7
Manufacture of medicinal
substances and products
86,1 107,5 93,7 120,6 108,9 147,7 111,6 131,2 107,2 120,0
12
The dynamics of industrial output and turnover of enterprises in the sector, measured
by the indices of industrial production and turnover, shows an overall positive trend
during the period 2001-2010.
The index of turnover on the domestic market shows an entirely upward tendency,
while in sub-sector "Manufacture of chemical products” the turnover growth exceeds
substantially the average levels in manufacturing. This shows that despite the negative
effects of the economic crisis opportunities for realization of the output of the sector
on the domestic market remain stable.
According to data of MEET, firms in sector “'Manufacture of chemicals and
pharmaceutical products” are over 700, as almost 90% of them operate in sub-sector
"Manufacture of chemical products" and 10% - in sub-sector “Manufacturing of
medicinal substances and products".
Regarding the regional distribution of enterprises and employees, relatively uniform
presence by regions (except for the low concentration in Northwest and Southeast
regions) is observed in sub-sector “Manufacturing of chemical products", while in
sub-sector "Manufacture of medicinal substances and products" there is a high
concentration of companies and employees in the Southwest region, followed by the
South Central region, and very weak presence in the other four regions.
Regional distribution of enterprises producing chemical products
6,8%
14,2%12,8%
30,5%
23,8%
11,98%
3,4%
25,5%
16,8%18,8%
26,6%
9,1%
0,0%
5,0%
10,0%
15,0%
20,0%
25,0%
30,0%
35,0%
% of companies in the sector
% of employees in the sector
Source: Database 'Amadeus', MEET, 2011
13
Regional distribution of enterprises producing medicinal substances and products
4,3%
10,6%7,4%
56,4%
14,9%
6,4%8,2%5,7%
3,3%
56,9%
25,4%
0,5%0,0%
10,0%
20,0%
30,0%
40,0%
50,0%
60,0%
% of companies in the sector
% of employees in the sector
Source: Database 'Amadeus', MEET, 2011
SMEs in sector "Manufacture of chemicals and pharmaceutical products"
In 2010, SMEs in sector "Manufacture of chemicals and pharmaceutical products"
represent 2% of all SMEs in the manufacturing industry.
Within the sector there are diverse changes in the number of SMEs in 2010 compared
to 2009, namely: an increase of 3.4% in the manufacture of chemical products and a
decrease of 3.6% in the manufacture of medicinal substances and products, which is
below the average level for the manufacturing industry - 4.6 percent.
The share of employed in SMEs in the sector of all employees in SMEs in the
manufacturing industry in 2010 is 2.8%. Compared to the negative tendency of
reduction of employment in SMEs in the manufacturing industry in 2010 compared to
2009 (- 7.5%), the sector registered a lower decline in the manufacturing of chemical
products (- 3,3%) and an increase (6.5%) in the manufacture of medicinal substances
and products.
In 2010, SMEs in the sector formed 5.6% of the turnover and 5.3% of the added value
generated by SMEs in the manufacturing industry. The growth in turnover (20% in
chemicals and 14% in medical substances and products) in 2010 compared to 2009
exceeds substantially the average level in manufacturing industry (1.8%). The same
positive trend is observed in added value, as the growth of 17.6% in medical
substances and products is one of the highest among the analyzed sectors.
The high level of added value of goods produced in the sector is a proof for the
presence of significant high-tech and innovation components.
The above conclusion is also confirmed by data on the level of labor productivity in
2010. They show that labor productivity in sub-sector "Production of medicinal
substances and products" measured as the ratio of value added produced per 1
employee (29,418 BGN) is the highest among all examined sectors. The value of this
14
indicator is high in sub-sector "Production of Chemicals" (20 372 BGN) as well, and
exceeds significantly the labor productivity of SMEs in manufacturing industry (11
421 BGN).
In terms of number of enterprises, number of employees and turnover, SMEs in
“Manufacture of basic chemicals", "Manufacture of soap and detergents, perfumes and
toilet detergents" and "Manufacture of other chemical products” are of structural
significance for the sector.
The financial analysis of companies included in the sample of the survey shows that in
2007-2010 the majority of SMEs operate on profit and steadily increase their financial
independence, as only micro enterprises recorded losses influenced by the negative
effects of the economic crisis.
The sector has a skilled workforce that knows and applies the traditional good
practices in manufacturing. This estimate stems from the relatively low priority that
participants in the survey give in the evaluation of measures for improving the
qualification of personnel.
EXPORT ORIENTATION OF THE SECTOR
General for sector “Manufacture of chemical and pharmaceutical products”
Export growth is a continuous trend for the period 2001-2008. This trend breaks in
2009 and the export level was restored in 2010.
The volume of exports in 2010 (213 452 thou. BGN for chemical products and 19 808
thou. BGN for pharmaceutical products) ranks the sector third among the 18 analyzed
sectors by share in total Bulgarian exports. A conclusion can be therefore made that
the sector as a whole is relatively little affected by the global crisis, since this position
is one of the best over the analyzed 10-year period.
In the period 2001-2010, exports of the sector increased by more than twice (225%).
The high starting level of exports of sector “Manufacture of chemical and
pharmaceutical products” is the main reason for the lower growth rate compared to
both the average for the 18 sectors (245%) and total national exports (272%).
The share of exports in total national exports increased since 2005 (7.06% in 2010)
but has not yet reached the level of 2001 (8.55%). The decrease in the period 2001-
2005 due to the restructuring of the sector is catching up relatively quickly in times of
economic crisis, which shows prospects of the sector for the national exports and the
economy as a whole.
SMEs in sector "Manufacture of chemicals and pharmaceutical products"
SMEs account for 10% of the total export of sector "Manufacture of chemicals and
pharmaceutical products" in 2010. This share was the lowest among the sectors for
which export strategies are developed1.
1 In the framework of Project No. BG161РО003 – 4.2.01-0001 “Promoting the internationalization of the
Bulgarian enterprises”, export strategies are developed for other 17 sectors in Manufacturing considered to have
15
Exports by SMEs in the sector in 2010 decreased compared to 2009, which, given the
increase in total exports of the sector, implies that under the conditions of financial
and economic crisis SMEs in this high-tech and scientific sector lose their market
positions.
SMEs producing chemical products have a relatively high share in total exports of
SMEs in manufacturing (1,26% in 2009 and 0,70% in 2010).
The export orientation of enterprises producing chemical products is further
confirmed by the high value of export per one employee, compared to other 17
analyzed sectors (32 860 BGN and 25 165 BGN in 2009 and 2010, respectively).
The share of SMEs in the group “Production of medicine substances and products”
in the total export of SMEs in manufacturing is very low (0,1% in 2009 and 0,07 in
2010).
The decrease in the value of the export per one employee (from 13,78 thou. BGN in
2009 to 11,41 thou. BGN in 2010) proves the weak export orientation of SMEs
producing medicine substances and products.
Despite the lack of data for most of the product classes in the sector, the conclusion
can be made that the decline in exports applies to all classes, except “Manufacture of
main chemical substances”.
According to data from the company survey, almost 90% of SMEs export their
production. Direct exports prevail without using other enterprises, trade organizations,
etc.
GOODS AND SERVICES WITH EXPORT ADVANTAGES AND POTENTIAL
General for sector "Manufacture of chemicals and pharmaceutical products"
Products subject to export from sector "Manufacture of chemicals and pharmaceutical
products" are extremely numerous. For the selection of products with export advantages to be
analyzed in detail, objective criteria were applied, namely:
Largest share in total exports of the respective product group;
Increasing share of exports in total exports of the respective product group.
Applying the selected criteria to data from the International Trade Centre allowed identifying
the following 15 product groups which have export potential and advantages:
Sensitive, unexposed and flat-format plates and films
Dextrins and other modified starches, incl. glues based on starches
Toilet products, shaving products, deodorants and others.
Hair care products
Beauty products, make-up, hair care, sun protection, manicure and pedicure products
export potential. The state, development and export orientation of the sector is compared (where appropriate) to
data for the rest of the sectors, so as to outline their positions and export potential.
16
Perfumes and toilet waters
Essential oils, resinoids and terpenic products
Medicaments in dosage forms
Human and animal blood, antisera, vaccines, toxins and cultures of micro-organisms,
Antibiotics
Carbonates, peroxocarbonates and ammonium carbonate
Sulphuric acid and oleum
Nonaqueous solution of paint and varnish
Organic surface-active agents, detergents (different than those listed in № 3401)
Soap; organic surface-active preparations for soap use.
From the list above, 3 products are from sub-sector “Manufacture of medicinal substances and
products" and the remaining 12 – from sub-sector "Manufacture of chemical products".
The main findings of the analysis of Bulgaria's position in world exports, exports dynamics,
the ranking of our country in terms of value of exports for the selected product groups in the
sector are summarized in the following table (source ITC):
Product groups
Rank in
world
exports in
2001
Rank in
world
exports in
2010
Share in
world
exports in
2010
Share in
the export
of the
world's
leading
exporter in
2010, as
of 2001
Share in
the export
of the
world's
leading
exporter in
2010, as
of 2010.
Export
Growth
Rate
2010/2001
Sensitive, unexposed and
flat-format plates and
films
18 12 1,13% 1,73% 5,84% 309%
Dextrins and other
modified starches, incl.
glues based on starches 21 12 0,99% 2,29% 5,25% 463%
Toilet products, shaving
products, deodorants and
others 36 31 0,58% 1,71% 5,34% 395%
Hair care products 23 39 0,37% 4,68% 2,86% 110%
Beauty products, make-up,
hair care, sun protection,
manicure and pedicure
products 47 58 0,07% 0,30% 0,33% 176%
Perfumes and toilet waters 59 55 0,05% 0,07% 0,17% 293%
Essential oils, resinoids
and terpenic products 28 24 0,81% 2,38% 5,57% 228%
Medicaments in dosage 41 37 0,16% 0,50% 1,12% 507%
17
Product groups
Rank in
world
exports in
2001
Rank in
world
exports in
2010
Share in
world
exports in
2010
Share in
the export
of the
world's
leading
exporter in
2010, as
of 2001
Share in
the export
of the
world's
leading
exporter in
2010, as
of 2010.
Export
Growth
Rate
2010/2001
forms
Human and animal blood,
antisera, vaccines, toxins
and cultures of micro-
organisms 48 35 0,06% 0,07% 0,28% 2095%
Antibiotics 24 24 0,31% 2,96% 1,34% 163%
Carbonate;
peroxocarbonate,
commercial ammonium
carbonate 39 5 4,30% 0,27% 17,65% 6883%
Sulphuric acid and oleum 18 10 3,66% 17,95% 28,06% 502%
Nonaqueous solution of
paint and varnish 59 54 0,08% 0,32% 0,52% 230%
Organic surface-active
agents, detergents 71 65 0,11% 0,23% 0,75% 501%
Soap; organic surface-
active preparations for
soap use
71 61 0,10% 0,54% 0,95% 437%
All 15 product groups have a high degree of export orientation – their export growth
rate in the period 2001-2010 is very high.
Product groups with stable positions on the world market include "Carbonates,
peroxocarbonate and ammonium carbonate", "Sulphuric acid and oleum" and
"Sensitive, unexposed and flat-format photographic plates and films", which have the
largest shares of world exports.
The best ranking among world exporters in 2010 is reached by the groups
"Carbonates, peroxocarbonates and ammonium carbonate", "Sulphuric acid and
oleum", "Sensitive, unexposed and flat-format photographic plates and films", and
"Dextrins and other modified starches, incl. glues based on starches". World exports of
these four groups of products also grow by relatively rapid rates.
Our country increases most rapidly its share in the world exports of 6 product groups,
as all of them, except the group "Human and animal blood, antisera, vaccines, toxins
and cultures of micro-organisms" are from sub-sector "Manufacture of chemicals",
namely: "Sensitive, unexposed flat-format photographic plates and films",
“Carbonates, peroxocarbonates and ammonium carbonate", “Sulphuric acid and
oleum", "Dextrins and other modified starches, incl. glues based on starches" and
"Toilets agents, shaving products, deodorants and others”.
18
"Carbonates, peroxocarbonates and ammonium carbonate" (18%) and "Sulphuric acid
and oleum" (28%) are the product groups where the volume of the Bulgarian export
has the largest share in the share of world's leading exporter in the product group in
2010.
The Bulgarian export of the product group of antibiotics has very stable positions in
world exports (a permanent 22-25 rank among world exporters) during the surveyed
period, indicating a relatively high export potential.
SMEs in sector "Manufacture of chemicals and pharmaceutical products"
The above data for the analyzed product groups refers to all enterprises in the sector,
and not only to SMEs. The lack of sufficient statistical information does not allow
identifying the share of SMEs in the export of analyzed product groups.
Some orientation is provided by the results of the conducted survey. Interviewed
companies declare that exported products in 2010 include mainly essential oils, DKF,
detergents, hair products, potassium cobalt nitrite, paints and varnishes, and ethyl
alcohol.
According to the survey, the most important factors for export success of SMEs are
the high level of technology and the high qualification of the personnel - identified by
all interviewed.
There is no variety in the forms of international cooperation of SMEs in the sector.
The main form of export of interviewed companies is direct export. One of the
respondents is a representative of a joint venture, which actually implements a specific
form of international cooperation.
Most of the company managers who participated in the survey declare a desire to
update their production by new products and thereby expand their export
opportunities.
19
COMPETITIVENESS OF EXPORT OF GOODS AND SERVICES ON FOREIGN
MARKETS
General for sector "Manufacture of chemicals and pharmaceutical products"
The main markets of the analyzed fifteen product groups are as follows:
Sensitive, unexposed and flat-format photographic plates and films
o The main markets are Germany, Italy, Spain, Hungary and Greece. For the two
years of the analyzed period the share of the Bulgarian export increased in Spain,
Hungary and Greece, and decreased in Germany and Italy.
o Products with the largest export to the leading market, Germany, are from the group
„Sensitive, unexposed and flat-format plates and films with at least one side
exceeding 255 mm".
o Our main competitors on the German market are companies from USA, Japan and
Belgium, which are among the leading exporters of this commodity group.
Dextrine and other modified starch and farina, incl. pastes on the basis of starch or
farina
o The major markets in the EU are Poland, the Netherlands, Greece, Romania and
Austria.
o The main non-EU markets are Turkey and Albania.
o Products with the largest export to the leading market, Turkey, in which Bulgaria
ranks first, are Dextrins and other modified starches (for example, gelatinised or
esterified starches); glues based on starches or on dextrins or other modified starches;
Dextrins and other modified starches or farina; esterified or etherified starches or
farina.
o Our main competitors on the leading market are the Netherlands, Germany and
Israel.
Toilet products, shaving products, deodorants and others.
o The main EU markets are UK, Spain, Italy, Germany and Romania, and Bulgaria`s
share increases on all markets during the analyzed period.
o Products with the largest export to the leading market, UK, are Preparations for
perfuming or deodorizing rooms, including odoriferous preparations used during
religious rites (excl. "Agarbatti" and other odoriferous preparations which operate by
burning).
o Our main competitors on the leading market are the Netherlands, Germany and
Israel.
Hair care products
o The main EU markets are UK, Netherlands, Romania, France and Latvia.
20
o The main markets outside the EU are Serbia, Georgia, Armenia, Russia and Ukraine,
as in Georgia and Armenia our country is among the top five suppliers of hair care
products.
o Products with the largest export to the leading market, UK, are shampoos and similar
products.
o Our main competitors on the leading markets are France, Germany, and USA.
Beauty products, make-up, skin care, sun protection, manicure and pedicure
products
o The main EU markets are United Kingdom and Romania.
o The main markets outside the EU are Serbia and Georgia.
o Products with the highest export to the leading market Romania are Finished Beauty
products or make-up products and skin care (other than medicaments), including
sunscreen products and suntan lotions (excl. medicines, make-up eyes products, lips
products and manicure or pedicure products); Products for manicure or pedicure; Eye
make-up products.
o Our main competitors on the leading market are Poland, France, and Germany.
Perfumes and toilet waters
o The main markets in the EU are Romania, Italy, Germany, Cyprus and Slovenia.
o Outside the EU, Bulgaria has a significant presence on the markets of Bosnia and
Herzegovina and Macedonia.
o Products with the highest export to the leading market Romania are Perfumes (excl.
shaving creams and deodorants) and toilet waters (excluding shaving creams,
deodorants and hair lotions).
o Our main competitors on the leading market are Poland, Germany, France, Slovenia,
Hungary, i.e. countries geographically close and with traditional trade relations with
Romania.
Essential oils, resinoids and terpenic products
o The main EU markets are France, Germany, Holland, Austria, and United Kingdom.
o Outside the EU, Bulgaria has a significant presence on the markets of Japan and the
United States, and it is increasing its exports to Chinese Taipei.
o Products with the highest export to the leading market France are Concentrates of
essential oils in fats, in fixed oils, in waxes or the like, obtained by extraction or
maceration; aqueous distillates and aqueous solutions of essential oils, Essential oils
(terpeneless or not), including so-called "concretes" and "absolutes" (excl. those of
citrus fruit, cloves, niaouli and ylang-ylang) and terpene oils, incl. so-called
"concretes" and "absolutes."
o Our main competitors on the leading market are world's leading exporters like India
and China, which raised their shares on this market.
21
Medicines in dosages
o The main markets in the EU are Romania, Germany, Poland, Latvia and Denmark.
o The volume of Bulgarian exports to markets outside the EU is significantly higher
compared to markets in the EU - the main markets are Russia, Serbia, Croatia,
Ukraine, and Bosnia and Herzegovina.
o Products with the highest export on the leading market Russia are Medicaments
containing alkaloids or their derivatives not containing hormones, not containing
hormones used as antibiotics steroids in the form of doses (including those for
transdermal administration systems) or in packages; Medicaments consisting of mixed
or unmixed products for therapeutic or prophylactic uses, put up in measured doses
(including those for transdermal administration systems) or packaging (excl.
medications containing antibiotics, hormones or steroids used as antibiotics, medicines
containing alkaloids or derivatives products, but not containing hormones or
antibiotics and medications containing provitamins, vitamins and their derivatives)
containing antibiotics and medicine in the form of doses (including those for
transdermal administration systems) or in packages (except medications containing
penicillins or their derivatives with a penicillanic acid structure, or streptomycins or
their derivatives.
o Our main competitors on the leading market are world leading exporters like
Germany, France, India, Italy, and Switzerland.
Human and animal blood, antisera, vaccines, toxins and cultures of micro-
organisms
o The main markets in the EU are Germany, Belgium, Cyprus, Denmark and UK, and
the share of the Bulgarian export of human and animal blood, antiserums, vaccines,
toxins, cultures of micro-organisms is extremely low on all five main EU markets.
o Products with the highest export on the leading market Germany are Blood fractions
and modified immunological products derived from biotechnology or other human
blood (excl. Antiserums, hemoglobin, blood globulins and serum globulins); Vaccines
for Humanitarian Medicine and Hemoglobin, blood globulins and serum globulins.
o Our main competitors on the leading market are USA, Switzerland, Spain,
Netherlands, and France.
Antibiotics
o The main markets in the EU are Germany, Holland, Italy, Spain and Belgium. The
share of the Bulgarian export of antibiotics is the largest in Netherlands, but it should
be noted that the share of exports of our country does not exceed 0.5% on any of the
five leading markets.
o Products with the highest export on the leading market Germany are Antibiotics (excl.
penicillins and their derivatives with a penicillanic acid structure, salts of those
products, streptomycin, tetracycline, chloramphenicol, erythromycin and its
derivatives, and salts of those products) and tetracyclines and their derivatives; salts of
those products.
o Our main competitors on the leading market are Switzerland, China, Italy, Spain,
Austria, which are traditional manufacturers in this commodity group.
22
Carbonates, peroxocarbonates and technical ammonium carbonate
o The main EU markets are Italy, Slovenia, Romania, Austria and Greece. With the
exception of Austria, on all other markets Bulgaria is among the top five suppliers of
the market.
o Products with the highest export on the leading market Italy are Sodium carbonate
(calcinated soda); sodium bicarbonate and carbonate; ammonium carbonate and other
ammonium carbonates (except Disodium carbonate), sodium bicarbonate, lithium
carbonate, calcium carbonate, barium carbonate and strontium carbonate.
o Our main competitors on the leading market are Turkey, Germany, and France.
Sulphuric acid and oleum
o The main markets in the EU are Romania, France, Greece, Spain and Slovenia.
Bulgaria ranks among the top five suppliers in Romania, France and Greece, and on
the Greek market our country is the leading importer in 2010 with a share of 78%.
o The volume of Bulgarian exports on markets outside the EU is significantly higher
than that on the EU markets - leading markets for Bulgaria are Turkey, Brazil, Cuba,
Chile and Morocco.
o The leading market for the exports of sulfuric acid and oleum is Turkey, where our
main competitors are Germany, Ukraine, Algeria, and Belgium.
Nonaqueous solution of paint and varnish
o The main markets of Bulgaria in the EU are Romania, Britain, Italy, Greece and
Slovakia.
o Products with the highest export on the leading market Romania are Paints and
varnishes based on polyesters, dispersed or dissolved in a nonaqueous environment;
Paints and varnishes based on synthetic polymers dispersed or dissolved in a
nonaqueous environment (excl. Those based on polyesters, acrylic or vinyl polymers)
and Paints and varnishes based on acrylic or vinyl polymers, dispersed or dissolved in
a nonaqueous environment.
o The main competitors of Bulgaria on the leading markets are Germany, France, Italy
and the Netherlands.
Organic surfactant substances and detergents
o The main markets of Bulgaria in the EU are Romania, Greece, Holland, Austria and
Italy.
o The main non-EU markets are Ukraine, Moldova, Macedonia, Serbia and Armenia,
and the volume of the Bulgarian export to markets outside the EU is larger than that
on the EU markets.
Soap; organic surface-active preparations for soap use
o The main markets of Bulgaria are in the EU - Romania, Greece, Germany, Belgium
and Hungary.
o Products with the highest export on the leading market Romania are Soap in paste
form or in aqueous solution "liquid soap"; Soap, organic surface-active products and
preparations of molded pieces or shapes and paper production, wadding, felt and
23
nonwovens impregnated, coated or covered with soap or detergent and organic
surfactant products and products for washing the skin, liquid or in cream form and
prepared for retail sale, whether or not containing soap.
o The main competitors of Bulgaria on the leading markets are Germany and Poland.
The Bulgarian exporters in the sector are oriented mostly to the large world markets of
the examined product groups which are traditional importers of the respective product
group.
The EU countries are the main market, current and with potential for development, for
Bulgarian products from the analyzed sector. The Balkan countries make another
important market due to the factor of geographical proximity, as well as the former
Soviet countries, due to traditional trade relations with them.
The volume of exports to countries outside the EU is similar to that in EU countries.
Russia is among the main markets for the sector in 10 of the 15 product groups. The
scale of the Russian market and lasting traditions for trade with the country (market
knowledge, customer requirements, etc.) make Russia one of the most promising
markets for sector "Manufacture of chemicals and pharmaceutical products".
Bulgaria is among the top five importers on the relevant markets for commodity
groups with the largest share in the export of the sector: sensitive, unexposed flat-
format photographic plates and films (1); carbonates, peroxocarbonates and
ammonium carbonate (4); Sulphuric acid and oleum (3).
Estimates of development by 2015 are prepared for each of the analyzed product
groups. Simulations of the trend lay on establishing the analytical form of the function
through which regularities in the development of exports of each product group in
2001 - 2010 are expressed, and estimating the values of the parameters of the function
used. In modeling exports, linear or logarithmic regression is used depending on the
regularities manifested in the output period. Regressions are calculated by using the
values for each year, not just in the first and last year of the period. The obtained
results are presented on the following figure.
24
Development forecast by product groups up to 2015
Source: International Trade Centre and own calculations
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
500 000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Photographic plates & film, flat, sensitized, unexposed
Dextrins & other modified starches; glues based on starches Toilet products
Hair preparations
Beauty products
Perfumes and toilet waters
Essential oils
Medicaments in dosage
Human & animal blood; antisera, vaccines, toxins, micro-organism cultures Antibiotics
Carbonate; peroxocarbonate, commercial ammonium carbonate Sulphuric acid and oleum
Nonaqueous solution of paint and varnish
Organic surface-active agents, detergents Soaps
25
Pharmaceutical and chemical industry in Bulgaria has stable growth rate and good prospects.
Data of the Bulgarian Industrial Association for 2010 show that despite the negative effects of
the global economic crisis on almost all industries in the country, the sectors of information
technologies, energy, and pharmaceutical and chemical industry are with the highest
potential for growth in a difficult environment.
According to forecasts for 2011, the value of the pharmaceutical market worldwide is
expected to grow by 5-7%. For comparison, the rates of development during the preceding
2010 were within 4-5%. According to experts in the branch, a slight increase can be expected
in the dynamics of the pharmaceutical markets, but the main reasons that limit their growth
will remain, including patents and reduced expenditures on pharmaceuticals, incl. in the EU.
Nevertheless, experts expect their permanent stabilization.
Manufacturers of chemical products are with stable positions, too. According to official data
published by Capital Market, a significant increase (by 9.3%) in the exported volumes of
perfumery and cosmetic products from Bulgaria is registered in 2010 compared to 2009. In
value terms, the annual increase is even greater, by 20.3%. The positive trend continues also
for the products of so-called ‘heavy chemistry’.
SMEs in sector "Manufacture of chemicals and pharmaceutical products"
Data from the survey of SMEs indicate that the main destination is the EU, Romania
and Greece ranking first and second, respectively.
SMEs export also to countries outside the EU - Serbia, Macedonia, Turkey and
Russia. It can be concluded that exports of SMEs are oriented mainly towards
destinations from the near geographic region.
The opinion of the managers of surveyed companies is that production capacity is
sufficient for export production. Bulgarian exports are considered competitive, with
potential for higher quality.
SMEs face problems caused by shortage of skilled professionals with foreign trade
expertise and knowledge.
The competitiveness of Bulgarian products is determined by the fact that according to
the interviewed companies the majority (95%) of enterprises with export potential in
the industry have a clear and well reasoned export strategy, they have realized a new
product on the market after 2007 (60%), have international certificates and own brands
(70%). A relatively high percentage of companies have R&D activities (63%).
The main advantages of the EU competitors on the markets where SMEs export their
products are high quality and large number of registered trademarks (when it comes to
pharmaceutical companies). Next indicated are already gained positions and traditions
in production. For competing countries outside the EU, lower commodity prices and
state subsidies are pointed out as more important advantages.
26
EXPORT PRIORITY PRODUCT GROUPS AND MAIN MARKETS
The analysis of commodity groups in the sector allows determining the leading export priority
product groups and specific markets. The choice is made on the basis of the following criteria:
share in the export of the sector, growing exports in the period 2001-2010, global market
share and concentration of SMEs in the sub-sector.
For each of the selected product groups the main markets for 2010, main suppliers and their
market share are presented.
UK
Ukraine
Georgia
• France (21.10%)• Germany (20.20%)• USA (18.80%)• Belgium (8.55%)
• Spain (5.82%)
• Bulgaria (1.48%)
• Russia (31.60%)
• France (22.47%)• Poland (14.94%)
• Germany (12.58%)
• Belgium (3.13%)
• Bulgaria (1.07%)
• Czech Republic (25.75%)• Ukraine (20.40%)• Germany (13.12%)• Bulgaria (12.58%)
Source: International Trade Center
Accounting for the specifics of the product, an appropriate model for entering new markets is
the use of approved distributors of products from the branch, followed by the creation of a
developed and independent distribution network.
Hair care products
27
France
Japan
Germany
• India (8.79%)• China (8.15%)• Italy (7.90%)• Ireland (6.86%)
• Morocco (5.88%)
• Bulgaria (2.62%)
• USA (26.90%)
• India (12.30%)• France (9.08%)
• Brazil (8.37%)
• China (8.09%)
• Bulgaria (2.76%)
• France (28%)
• India (20%)
• China (8%)• USA (8%)
• Italy (7%)
• Bulgaria (0.68%)
Source: International Trade Center
Accounting for the specifics of the product, an appropriate model for entering new markets is
the use of approved distributors of products from the branch, followed by the creation of a
developed and independent distribution network. In turpentine products, production
cooperation and establishment of joint ventures are also adequate.
Russia
Romania
Serbia
• Germany (19.27%)• France (11.04%)• India (6.62%)• Italy (6.04%)
• Switzerland (5.85%)
• Bulgaria (13%)
• Hungary (18.30%)
• Germany (14.82%)• France (12.12%)
• Switzerland (7.49%)
• The Netherlands (7.25%)
• Bulgaria (2.19%)
• Germany(19.34%)
• France (13.6%)
• Italy (8.59%)• UK (8.22%)
• Macedonia (4.29%)
• Bulgaria (0.30%)
Source: International Trade Center
Essential oils, resinoids and terpenic products
Medicaments in dosage forms
28
Romania
UK
Serbia
• Germany (22.20%)• The Netherlands(14.13%)• Italy (13.70%)• France (10.80%)
• Turkey (5.57%)
• Bulgaria (4.74%)
• Germany (21.42%)
• The Netherlands (12.36%)• Italy (11.16%)
• France (10.88%)
• Belgium (9.15%)
• Bulgaria (0.001%)
• Italy (25.14%)
• Germany (21.30%)
• Greece (13.97%)• Slovenia (11.22%)
• Croatia (9.01%)
• Bulgaria (0.05%)
Source: International Trade Center
Suitable model for entering new markets for this product group is both the use of approved
distributors of products of the sector, as well as production cooperation and establishment of
joint ventures.
Ukraine
Romania
Moldova
• Russia (37.79%)
• Poland (11.36%)• Germany (10.43%)• USA (5.82%)
• Bulgaria (4.20%)
• Poland (12.56%)• Czech Republic (12.44%)
• Hungary (11.02%)• Serbia (9.70%)
• Germany (7.07%)
• Bulgaria (2.76%)
• Romania (36.66%)• Turkey (10.72%)• Bulgaria (10.68%)
Source: International Trade Center
Nonaqueous solution of paint and varnish
Soap; organic surface-active preparations for soap use
.
29
Suitable model for entering new markets for this product group is the use of approved
distributors of products in the sector.
The main importers on the above identified markets for chemical and pharmaceutical products
are international companies which rank among the world leading manufacturers and
exporters.
In conclusion, the main markets of product groups manufactured by sector "Manufacture of
chemicals and pharmaceutical products" are in Europe. Among them, the most important
markets are Romania, Germany, Great Britain and Russia, as geographical proximity and low
export costs are of great importance.
BARRIERS TO THE INTERNATIONALIZATION OF SMALL AND MEDIUM
ENTERPRISES AND MEASURES FOR THEIR OVERCOMING
Based on the conducted survey, focus group, and interviews and received additional written
statements and opinions of leading experts in the sector, the barriers to internationalization of
SMEs in sector "Manufacture of chemicals and pharmaceutical products" are identified and
analyzed, as well as the measures preferred by companies for their overcoming and export
promotion.
Assessment of the severity of barriers to the export of enterprises in the period
2007-2011 (in %)
Barriers Very
serious
obstacle
Serious
obstacle
Not a serious
obstacle
Not an
obstacle
High production costs of goods and
services
30 40 10 20
High export realization expenditures 15 35 35 15
Not high enough quality of the goods
and services
10 40 20 30
Lack of qualified staff to ensure quality
over a longer period
5 50 5 40
Lack of experience in the foreign trade
activity
10 20 40 30
Language barriers 35 25 40
Unfavorable business environment in
Bulgaria
25 25 25 25
High risk on the various foreign
markets
15 55 20 10
Customs and non-customs restrictions
imposed by other countries
10 40 30 20
Lack of support by the Bulgarian state
for the export
10 50 25 15
Source: Survey conducted with representatives of SMEs in the sector, 2011
The managers of surveyed SMEs declare that the significant obstacles are related to
external factors, mainly the risks on foreign markets and the lack of sufficient support
30
by the Bulgarian state. The most significant obstacle to exports of SMEs in the sector
is the high production costs of products made in Bulgaria.
Companies in the sector clearly realize the necessity of modernization of production in
order to improve their competitiveness, incl. on the international market. This is
confirmed also by the fact that in the classification of priority measures for support,
the highest weight is given to the support for technological modernization of
production.
Other measures with high priority involve improving the access to finance, promotion
of the export of companies, support for covering the EU standards, financing of
innovative projects to develop new products, technologies and services.
Most of the measures for overcoming barriers to exports are expected to be taken by
the state. The need in creating normal business climate in Bulgaria is most often
specified. Moreover, respondents focus on a business environment which should be
adequate to the present severe economic crisis.
Companies rely most of all on their own efforts for obtaining the necessary export
information and to a much lower degree on administrative structures like BSMEPA
and branch associations.
Priority
Very high and high
priority
Average priority Low priority and
no priority
until 2013 2014 -
2020
until 2013 2014 -
2020
until
2013
2014 -
2020
Promotion of the export
companies
85,0 89,5 5,0 5,3 10,0 5,2
Support for the technological
modernization of production
95,0 94,7 5,0 5,3 0,0 0,0
Support for meeting the EU
standards
85,0 78,9 15,0 21,1 0,0 0,0
Financing of innovation
projects
85,0 68,4 15,0 31,6 0,0 0,0
Training and improving the
qualification of employees in
SMEs
55,0 57,9 40,0 42,1 5,0 0,0
Attracting foreign direct
investment
65,0 63,2 35,0 31,6 0,0 5,3
Business cooperation and
participation in clusters
35,0 31,6 45,0 36,8 20,0 31,6
Consultancy and information
services
40,0 31,6 35,0 42,1 25,0 26,4
Improvement of the access to
finance
90,0 78,9 5,0 10,5 5,0 10,6
Source: Survey conducted with representatives of SMEs in the sector, 2011
All this gives grounds to suggest the following measures to reduce barriers to export of SMEs
in sector "Manufacture of chemicals and pharmaceutical products":
Updating the export strategy for sector "Manufacture of chemicals and pharmaceutical
products"
31
Creating a profile (catalog) of export-oriented SMEs in sector “Manufacture of
chemicals and pharmaceutical products", starting with companies in sub-sectors
"Manufacture of soap and detergents, perfumes and toilet preparations" and
"Production of pharmaceutical in dosage forms"
Creating an adequate information database for SMEs, assisting the decision making
process for the sector (incl. data on foreign markets, potential foreign partners,
international fairs, exhibitions and other promotional events on the web-site of the
National Export Portal)
Maintenance on the National Export Portal of database on foreign markets, potential
foreign partners, international fairs, exhibitions and other promotional events
Improving the awareness of SMEs in sector "Manufacture of chemicals and
pharmaceutical products" for the available funding opportunities from national and
foreign financial sources (excluding trade credits)
Create and implement programs for improving the qualification of export specialists in
SMEs
Create and implement a training program for participation in international exhibitions
as its implementation starts with sub-sectors "Manufacture of soap and detergents,
perfumes and toilet preparations" and "Manufacture of medicaments in dosage forms"
Financial support for the certification of enterprise in quality management,
environmental management and introduction of safe and healthy working conditions
Increasing the weight of the assessment of export orientation of enterprises in the
overall assessment for financial support under EU financed programs
Support the creation/further development of organizations/clusters to support export of
SMEs in the sector
Creating a mechanism for financial support of participation of foreign partners in local
fairs and exhibitions, starting with subsectors "Manufacture of soap and detergents,
perfumes and toilet preparations" and "Manufacture of medicaments in dosage forms"
Development of working procedures for the Bulgarian trade representatives abroad in
favor of small and medium enterprises in the sector
Promotional measures for chemical and pharmaceutical products - cosmetics and other
beauty products on EU markets
Promotional measures for chemicals, cosmetics and other beauty products on non-EU
markets
Promotional measures for chemicals - not cosmetic and other beauty products, on EU
markets
Development of models for new market entry of SMEs in sector "Manufacture of
chemicals and pharmaceutical products" starting with sub-sector products
"Manufacture of soap and detergents, perfumes and toilet preparations"
32
3. SWOT AND LOED ANALYSES OF THE EXPORT PROCESS OF
SMEs IN SECTOR “MANUFACTURE OF CHEMICAL AND
PHARMACEUTICAL PRODUCTS”
SWOT ANALYSIS
The SWOT analysis is based on the idea of splitting the object of the strategic analysis from
the environment in which it operates. The object of the strategic analysis is viewed in its
"strengths and weaknesses”. The environment in which the object of the strategic analysis
functions shall be differentiated to "opportunities and threats."
Strengths. The strengths are the resource, the skill or some other advantage, which the sector
has as feature. The strength is a distinctive competence that gives a comparative advantage.
Weaknesses. The weaknesses are constraints or lack of resources, skills and abilities that
seriously hinder the development of the sector.
Opportunities. The opportunities are the most favorable elements of the external environment.
These are favorable external factors, of which the sector benefits or could benefit.
Threats. The threats are the worst segments of the external environment. They put the biggest
barriers to the present or future (desired) state of affairs.
Strengths Opportunities
o Availability of the necessary raw
materials and resources for the
manufacture of chemical and
pharmaceutical products
o Availability of experts with higher
education working in the sector
o Traditions in the production of products in
sector "Manufacture of chemicals and
pharmaceutical products"
o Increase of the volume of production and
added value in most product groups
o High labor productivity in SMEs in the
sector
o Availability of resources for financial
support of SMEs by the EU
o High share of enterprises with certificates
and own trademarks
o The sector is identified by the state as one
with export potential
o Access to the EU markets
o Bulgarian production of chemical and
pharmaceutical products is well-known on
the markets in Russia and the Middle East
o Successful experience in cooperation with
foreign partners, incl. establishment of
joint ventures in the sector
o Existence of branch associations
(Bulgarian Chamber of Chemical
Industry, Bulgarian National Association
Essential oils, Perfumery and Cosmetics,
etc.)
o Availability of resources for financial
support of the Bulgarian participation in
international fairs and exhibitions
o Existence of higher schools for training of
qualified technical personnel
33
Weaknesses Threats
o Lack of modern and resource effective
technologies and equipment
o Insufficient level of qualification of high
technical staff, mostly in chemical
production
o Lack of foreign trade staff
o Lack of knowledge for the Bulgarian
production/the Bulgarian mark on foreign
markets
o Low level of awareness of SMEs about
available funds for supporting their
activity
o Lack/undeveloped cluster structures for
export (export unions)
o Impeded procedure of registration of the
products on foreign markets
o Lack of adequate information assisting
informed management decision-making
for the sector
o Reduction of consumption on national and
world level, mainly of chemical products
o EU has significant trade surplus in the
manufacture of chemical substances
o Support of the business by EU funds is
not focused on investments for
technological modernization and
implementation of new products in sector
"Manufacture of chemicals and
pharmaceutical products"
o Expiry of the patents of traditional
medicinal products (for production of
medicinal substances and products)
LOED ANALYSIS
LOED analysis is an instrument that helps identifying how to strengthen the positive effect of
the examined process and neutralize the negative effects. The word is an acronym of the
words in English – lever, overcome, exploit, and defend. LOED analysis shows how strengths
can be levered, weaknesses – overcome, and how to exploit the opportunities and defend
against the threats identified by the SWOT analysis.
Build on strengths Use of opportunities
o Implementation of structure projects and
strategies for promoting exports of SMEs
in the sector
o Improving the material base in schools
and universities training staff for chemical
and pharmaceutical production
o Control on production and reduction of
environment polluting emissions
o Applying specific facilitated credit terms
for exports of SMEs in the sector
o Policy of integration between the local
and foreign markets
o Development of international partnerships
both for manufacturing and distribution of
products
o Effective and quick realization of
production through developed sale
channels by establishing unions/co-
operations for export
o Organization of trade exhibitions and
events for introduction of the Bulgarian
chemical and pharmaceutical products
o Development of current production and
encouraging the implementation of
innovation technology and new products
o Development of product assortment and
specialized products for export.
o Orientation to new markets
34
o Bringing out “export orientation of
SMEs” as a main criterion for providing
financial incentives to the companies
Overcoming weaknesses Protection from threats
o Development of clear and simplified rules
for financial support of export-oriented
SMEs
o Reform of the administrative system
aiming at facilitating the access of SMEs
to administrative services
o Establishing connections between
statistics and business
o Organizing a program for presenting and
acquainting with foreign markets
o Training of both technical and trade
personnel of SMEs in the sector
o Raising staff qualification in SMEs in the
sector
o Development of foreign trade and
marketing specialists
o Increase awareness of the Bulgarian
products on foreign markets
o Stimulating the creation/ restoration of the
contacts between business and science
o Development of adequate database
assisting management decisions on the
three levels of management
o Orientation to new fast developing
markets of chemical and pharmaceutical
products - China, India
o Selection and orientation to a group of
partners and efforts for achieving high
levels of quality
o Avoiding dependence on a single partner
o Manufacture for export but also for the
local market, in order to guarantee the
liquidity and solvency of companies
o Development of sustainable and clear
state policy for supporting national export
35
4. OBJECTIVES
STRATEGIC OBJECTIVE
Retaining the share of SMEs in the sector in the export of the sector and in total national
exports
OBJECTIVES
1. Increasing the number of SMEs with export potential in the sector
2. Increasing the export market share of SMEs in the sector
To achieve the determined objectives, different measures shall be identified to support the
export of SMEs in sector “Manufacture of chemicals and pharmaceutical products” and to
focus on problem issues identified by the analyses. Selected measures should be clearly linked
with the potential mechanisms by which public institutions can influence the processes. Under
these conditions, three areas were identified where state institutions through commitment and
other stakeholders – through promotion and incentives, could perform actions to achieve the
objectives. For each of these areas, clear and measurable specific objectives are defined as
follows:
Specific objective 1: Development and successful functioning of information and normative
base for support of the export of SMEs in the sector.
Specific objective 2: Raising the qualification of employees of SMEs in the sector with focus
on commercial staff and departments in charge of foreign trade on company level.
Specific objective 3: Supporting the operation of enterprises and their access to foreign
markets and partners.
36
5. STRATEGY TO PROMOTE EXPORT OF SMEs IN THE SECTOR
To achieve the goals different alternatives of development are possible, in the case two
scenarios were assessed, namely:
1. Maintaining the current structure of government institutions providing business
support, including the existing relationship between them and export-oriented SMEs from the
sector "Manufacture of chemicals and pharmaceuticals"
2. Changing the structure and transfer of functions to support SMEs to units and forms
related to the financing of projects from EU funds and state budget following the model of
operational programs or program for rural development.
These scenarios were assessed by the following criteria:
1. Possibility for implementation of the selected scenario within a 5-year period;
2. Practices of supporting export-oriented SMEs in other EU member-states;
3. Estimation of the efficiency of business supporting activities performed by established
specialized structures or by existing programs supporting SMEs on a project basis.
The analysis made pointed out that:
The transition from the presently existing system to a new one on a project basis will
take more than 5 years. Moreover, according to the existing rules for the period till
2013, this is actually impossible, since all priorities and activities of operational
programs are clearly defined. Such an approach, if possible, for the next
programming period 2014-2020, should be put to negotiations, but in practice it will
again take several years for its actual launch, like the start of OP in all EU countries
for 2007-2013.
The Bulgarian model through BSMEPA is preferred by the major part of the EU
member-states and, although with varying success in different countries, there is no
tendency observed for changes in the near future.
Reported difficulties in the accomplishment of business projects under operational
programs, such as OP “Competitiveness”, indicate that the efficiency of supporting
export-oriented SMEs, regardless of being subject to critics due to lack of funds and
proper focusing, is at relatively much higher level than the results achieved by
business under project designed measures.
Given the above conclusions, the first alternative gained preference, i.e. the development of
Export Strategy for SMEs in sector “Manufacture of chemicals and pharmaceuticals” shall be
based on the understanding that all measures will be undertaken in the framework of presently
existing structures and within their present capacities.
In strategic perspective, the selected alternative will demand both common measures for the
whole SME supporting system, for example, improving the capacity of institutions,
implementation of clear and measurable indicators and criteria for assessing the efficiency of
their work and support rendered to business, etc., as well as specific changes related to sector
“Manufacture of chemicals and pharmaceuticals” in particular, like, for example, sector-
oriented approach of work. As far as this is not a subject of analysis and research of the
37
present strategic document, it will probably become a part of developing a strategy or a
program for improving the capacity of relevant state administrations.
This Export Strategy for SMEs in sector “Manufacture of chemicals and pharmaceuticals”
envisages several main steps directed at improving the support to export-oriented SMEs,
namely:
1. Creating of the basis for adequate and professional management of processes of
supporting export-oriented SMEs, by establishing an information basis for making
informed management decisions. The created data base should include information on
the number and characteristics of export-oriented SMEs, volumes and markets of their
export, and other information necessary to build a profile of SMEs, incl. of export-
oriented SMEs. The availability of adequate information will allow the establishment
of a working model of communication with the business community, studying of its
necessities, facilitating of the process of utilization of funds directed at bettering SME
export conditions, etc.
2. Development of the necessary programs, policies and measures to support SME export
on foreign markets, through measures targeted at markets with prospects to preserve or
expand the existing positions, joint work with units having direct abilities to assist
exports (for example, foreign trade representatives and the MEET), as well as routine
measures, such as (for instance) participation in fairs, trade missions, business visits,
etc.
3. Measures directed at overcoming certain deficits of export-oriented SMEs, presenting
barriers to their export development, for example, such as: support the technological
modernization of SMEs in order to improve their export positions; assist the
establishment of sector profiled export companies; organize advertising campaigns to
raise the image of the Bulgarian business, etc.
4. Measures directed at raising the capacity of SMEs, mainly by different training
programs.
Accounting for the terms of the Export Strategy for SMEs in sector “Manufacture of
chemicals and pharmaceuticals”, the envisaged steps are realistic and could contribute to
achieving real results in export supporting.
The political will to provide the funds necessary for implementing of the strategy is also an
important prerequisite for its successful accomplishment.
38
6. ACTION PLAN
Due to the mid-term 5-year horizon of the Strategy, measures in the Action Plan are
concretely formulated.
Envisaged financial resources are indicative, but they are consistent with the realistic
opportunities to increase the budget of BSMEPA. Estimated resources from Operational
Programs in the next programming period are rather contingent, as the allocation rules are not
yet finally adopted by the EU. At the same time, it is crucial that BSMEPA and MEET defend
fair requests for funds especially for this leading export sector of the country and for the
development of SMEs, which are the backbone of any economy.
In compliance with the selected model, for all envisaged measures specific actions are defined
to be implemented at micro (SME), meso (branch organizations) and macro (state) level.
On the basis of analysis of exports of different product groups, important and priority
markets for the sector are identified. However, as mentioned above, data is not available on
the participation of SMEs on those markets. Therefore, in order to suggest indicative
promotional measures on the identified markets, it is assumed that in periods of crisis efforts
should be directed both at preserving the existing market positions and entering new markets
as well but rather at. The fact that Bulgarian exports are already made on the existing markets,
allows assuming that this will be an advantage for SMEs which orient to these same markets.
39
ACTION PLAN
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
Specific objective 1: Development and successful functioning of information and normative base for support of the export of SMEs in the sector.
1.1. Update of export strategy
for sector “Manufacture of
chemicals and
pharmaceuticals”
04.2013 MEET 40 000 BGN MEET - OPC Export Strategy and
Action Plan to be
implemented
Prepared documents are of good
quality
Documents are prepared and
approved within schedules
Strategy implementation has led
to achievement of stated
objectives
Micro and Meso level:
- Provision of the necessary information, incl. participation in sociological surveys, focus groups, opinions and statements
Macro level:
- Overall coordination of the process of update and implementation of the Export strategy for the sector
1.2. Create a profile (catalog)
of export- oriented SMEs in the
sector, starting with companies
in sub-sectors "Manufacture of
soap and detergents, perfumes
and toilet preparations" and
"Production of pharmaceutical
dose form"
12.2013 BSMEPA / MEET
in co-operation with
branch associations and
NSI
10 000 BGN Budget of
BSMEPA
Database with
information on export -
oriented SMEs
Prepared criteria and list
of SMEs which are
export- oriented.
Prepared criteria and list of
export-oriented companies are
uploaded on the National export
portal
Micro level:
- Providing information
Meso level:
- Encourage and assist companies to provide information on their export activity
40
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
- Assisting BSMEPA in the preparation of criteria for export-oriented SMEs
Macro Level:
- Obtaining regular information from the NSI for the purposes of prepared database and information system
- Development of criteria for export-oriented SMEs
- Preparing, maintaining and updating the database and profile of export-oriented SMEs in the sector
1.3. Setting up an adequate
database for SMEs in sector
"Manufacture of chemicals and
pharmaceutical products", incl.
data on foreign markets,
potential foreign partners,
international fairs, exhibitions
and other promotional events,
on the National Export Portal
12.2013 BSMEPA / MEET / NSI 50 000 BGN Budget of
BSMEPA /
MEET
Available and adequate
processed information for
the development of the
sector and SMEs on the
National Export Portal
Created and operating
information system
Easy and fast access to
information for development of
the sector and SMEs in it
Number of enterprises using
information database, uploaded
on the National Export Portal
- Micro level:
- - Providing data for the information system and database
- Meso level:
- - Providing data and analyses for the information system and database
Macro Level:
- Coordination and organization of the process of creating an information system and database for SMEs, foreign markets, potential foreign partners, international fairs,
exhibitions and other promotional events
1.4. Maintenance on the
National Export Portal of
database for foreign markets,
potential foreign partners,
international fairs, exhibitions
Permanent BSMEPA / MEET 10 000
BGN per
year
Budget of
BSMEPA
Permanently operational
and updated database
Number of enterprises satisfied
with the quality of information
available
41
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
and other promotional events
Meso level:
- Providing data and analyses for the National Export Portal
Macro Level:
- Coordination of the process of maintaining on the National Export Portal of database for foreign markets, potential foreign partners, international fairs, exhibitions and other
promotional events
1.5. Improving the awareness
of SMEs about available
funding opportunities from
national and foreign financial
sources (excluding trade
credits)
Permanent BSMEPA 5 000 BGN
per year
Budget of
BSMEPA
Increase of the number of
firms applying for
financial support
Number of enterprises applying
for financial support
Micro level:
- Participation in organized events about promotion and dissemination of information on available funding opportunities from national and foreign financial sources
Meso level:
- Participation in and dissemination of information about organized events about promotion and dissemination of information on the available funding opportunities from
national and foreign financial sources
Macro level:
- Organization and coordination of the process of informing SMEs about available funding opportunities from national and foreign financial sources (excluding trade credits)
Specific objective 2: Raising the qualification of employees of SMEs in the sector with focus on commercial staff and departments in charge of foreign trade on
company level.
2.1. Development and
implementation of programs
for raising the qualification of
export specialists in SMEs
2014-2020 BSMEPA, Universities
and branch associations
50 000 BGN
annually
Budget of
BSMEPA and
Operational
Programs
Trained over 1000 export
specialists from SMEs for
the program period.
Number of trained export
specialists
Micro level:
- Provision of information on the needs of training and participation in the trainings
42
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
Meso level:
- Development of training programs and conducting trainings
Macro level:
- Organization and coordination of the process of development and implementation of programs for raising the qualification of export specialists in SMEs
2.2. Development and
implementation of training
program for participation in
international exhibitions,
starting with sub-sectors
"Manufacture of soap and
detergents, perfumes and toilet
preparations" and "Production
of pharmaceutical dose form"
12.2017 BSMEPA 20 000 BGN
annually
Budget of
BSMEPA
Trained experts from
minimum of 400 SMEs
Number of trained experts for
participation in international
exhibitions
Micro level:
- Provision of information on the needs of training and participation in the trainings
Meso level:
- Participation in the development of training programs and assistance in conducting of trainings
Macro level:
- Organization and coordination of the process of development and implementation of programs
Specific objective 3: Supporting the operation of enterprises and their access to foreign markets and partners
3.1. Financial support for
certification of enterprises in
quality management,
environment management
and implementation of
system for safe and healthy
Permanent MEET 500 000 BGN
annually
MEET - OPC Increased number of
enterprises which
obtained certificates
Number of enterprises which
obtained certificates
43
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
working conditions
Micro level:
- Development of proposals for financing of activities for creation of quality management systems and putting the systems in operation
Meso/Macro level:
- Support the evaluation of proposals
- Managing the entire process of financial support and performance monitoring
3.2. Increase of the weight of
the assessment of export
orientation of enterprises in the
total assessment for financial
support.
12.2013 MEET, MRDPW, CM OPs for business support
are oriented at
supporting SMEs with
export potential.
In the assessment criteria of
project proposals, the export
potential is explicitly specified.
Micro/Meso level:
- Active participation in the development of proposals for increasing the weight of the assessment of export orientation of enterprises in the total assessment for financial
support.
Macro level:
- Development of proposals for increasing the weight of the assessment of export orientation of enterprises in the total assessment for financial support.
3.3. Assistance in the creation /
further development of
organizations/clusters for
supporting the export of SMEs
12.2017 BSMEPA, branch
associations
100 000 BGN
annually
Operational
programs
Created export
organizations/clusters for
supporting the export of
enterprises.
At least 2 export clusters created
Micro level:
- Participation in export clusters in the sector
44
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
Meso level:
- Participation in creation and development of export clusters
- Encouraging the participation of SMEs in export clusters
Macro level:
- Assistance in the creation /further development of organizations/clusters for supporting the export of SMEs
3.4. Development of
mechanism for financial
assistance of the participation
of foreign partners at local
fairs and exhibitions, starting
with sub-sectors "Manufacture
of soap and detergents,
perfumes and toilet
preparations" and "Production
of pharmaceutical dose form”.
12.2012 BSMEPA, branch
associations
30 000 BGN
annually
Budget of
BSMEPA; funds
of branch
associations
Concluded contracts for
export due to the
participation of foreign
trade partners.
Increase on annual basis of
export contracts with invited
foreign trade partner.
Micro level:
- Provision of information about potential partners and concluded contracts
Meso level:
- Development of draft mechanism and support for its application.
Macro level:
- Coordination of the process and support for its application
3.5. Development of working 12.2012 BSMEPA/ MEET /CM Approved decision on CM Increase in the number of export
45
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
procedures for the Bulgarian
trade representatives abroad in
favor of SMEs in the sector
level and developed and
implemented working
procedures for the trade
representatives
contracts for products from the
sector, produced by SME, as a
result of implementing the
working procedures
Macro Level:
- Study the needs of SMEs in the sector of information and services that are provided by the Bulgarian trade representative
- Development of procedures for operation of Bulgarian commercial representations in favor of SMEs in the sector
3.6. Promotional measures for
chemical and pharmaceutical
products - cosmetics and other
beauty products on EU markets
2014 - 2020 BSMEPA
Branch associations,
companies
150 000 BGN
annually
OP for the next
programming
period;
companies,
branch
associations
Improving the image of
Bulgarian products and
awareness of foreign
customers for them
Increased number of export
contracts as a result of 1 event
(average per one event)
Organization of participation in fairs and exhibitions, organization of events and contacts with professionals – technologists, cosmetologists, etc. information activities.
Well-known and high-attended international exhibitions include: Exhibition of Hairdressing, Beauty and Wellness in Barcelona - Spain; WORLD OF BEAUTY & SPA JARO -
Czech Republic; COSMETICS BEAUTY HAIR - Beauty Expo - Bucharest, Romania; INTERCHARM MILANO - Exposure for cosmetics and hairdressing - Italy, Milan
Micro level:
- Participation in events
- Preparation of promotional and presentation materials
- Preparation and distribution of product samples during the events
- Preparation and presentation of materials on product qualities
- Organization of demonstration sessions on the use of products
Meso level:
- Supporting the organization and participation in events
- Organization of meetings with experts, journalists, doctors, cosmeticians, dealers, distributors, wholesalers, importers and other participants - influencing consumer attitudes
Macro Level:
- Overall coordination of the organization and performance of information activities at sale spots:
- Organization of meetings with experts, journalists, doctors, cosmeticians, dealers, distributors, wholesalers, importers and other stakeholders - influencing consumer attitudes.
- Organization of demonstration sessions on the use of products
46
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
- Organization of demonstration days in big retailers on the respective market (offering promotional bags / other promotional materials / samples of products, projections of
short commercials in the respective language, etc.).
3.7. Promotional measures for
chemical products, cosmetics
and other beauty products on
non-EU markets
2014 – 2020 BSMEPA,
Branch associations,
companies
150 000 BGN
annually
OP for the next
programming
period;
companies,
branch
associations
Improving the image of
Bulgarian products and
awareness of foreign
customers for them
Increased number of export
contracts as a result of 1 event
(average per one event)
Organization of participation in fairs, events and contacts with professionals - technologists, cosmetologists, etc. information activities.
Well-known and high-attended international exhibitions include: Beauty World Middle East - Dubai, UAE; Beauty Eurasia - Exhibition of cosmetics and hairdressing -
Istanbul; DODIR PARIZA - Exhibition of cosmetics, wellness and spa - Serbia, Belgrade; InterCharm, Dental Expo - Moscow, Russia
Micro level:
- Participation in exhibitions
- Preparation of promotional materials and samples
- Preparing and delivering specialized presentations
- Organization of demonstration sessions
-
Meso level:
- Assisting overall organization and facilitation of companies during the events
Macro Level:
- Overall coordination of the organization of the Bulgarian participation
- Organization of specialized meetings during exhibitions
3.8. Promotional measures for
chemical products, excl.
cosmetic and other beauty
products, on EU markets
2014 – 2020 BSMEPA
Branch associations,
companies
200 000 BGN
annually
OP for the next
programming
period;
companies,
branch
associations
Improving the image of
Bulgarian products and
awareness of foreign
customers for them
Increase by 5% the number of
export contracts as a result of 1
event
Organization of Bulgarian participation in fairs and exhibitions of machine-building and construction industry, organization of events and contacts with professionals –
47
Objectives and measures Deadline Responsible institutions Financial
resources
Sources of
financing Expected results Implementation Indicators
technologists, designers, manufacturers of machinery, etc. and information activities. International exhibitions with high attendance are: СHEMSPEC - Chemicals – Spain,
Barcelona; PAINT 2012 - paints, raw materials and auxiliary products – Istanbul, Turkey; SFORTEC – Technical Fair - Italy, Milan; THE – Industrial Fair - Italy, Milan
Organize meetings with specialists, wholesalers, importers and representatives of industrial enterprises.
Inclusion of special presentations by expert teams to acquaint the audience with the qualities of products.
Organization of demonstration sessions on the use of products
Micro level:
- Participation in exhibitions
- Preparation of promotional materials and samples
- Preparation and conducting of specialized presentations
- Preparation and conducting of demonstration sessions
Meso level:
- Assisting overall organization and facilitation of companies during the events
Macro Level:
- Overall coordination of the organization of the Bulgarian participation
- Organization of specialized meetings during exhibitions
3.9. Development of models for
new markets entry of SMEs in
sector " Manufacture of
chemicals and pharmaceuticals",
starting with products of sub-
sector "Manufacture of soap and
detergents, perfumes and toilet
preparations"
2013 BSMEPA, OTEA 10 000 BGN Budget of
BSMEPA
Models are developed
aimed at SMEs in the
sector, regarding the
steps for establishing on
new markets
Number of developed and
adopted models
Macro Level:
- Development of models regarding the necessary actions/steps to be undertaken by SMEs in entering new markets.
48
7. MONITORING AND CONTROL SYSTEM
For each strategic document it is of great importance, first, to be implemented in accordance with
predetermined goals, deadlines and resources; second, to be sustainable over time and to develop
the activities and effects determined in it. For this purpose, it is advisable to observe (monitor) and
assess the implementation of the document and to identify appropriate actions - for correction and
improvement of its inherent activities.
Monitoring can be defined as: (a) an integral part of the ongoing project management (attributed
also to the implementation of the Export Strategy for sector “Manufacture of chemicals and
pharmaceuticals”, aimed at achieving a certain change - in this case, improving the export
performance of SMEs in the sector); (b) an instrument assisting the control on 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, timely and relevant information on the progress, changes
and consequences of undertaken program actions. These essential features of monitoring make it
one of the most important components of the management of strategic documents, programs,
projects, etc.
Assessment in its turn is a systematic review of specific management activities aiming to provide
information about the full range of short and long-term effects on the target groups. Program
evaluation may include assessment of the workload, operating procedures, or personnel, but its
main purpose remains the effect and impact of implementing the program (strategic document).
Monitoring should therefore establish the status and follow the progress in implementing the
various components and subcomponents, and the Strategy as a whole. Monitoring should also
identify emerging problems and factors that determine them, and suggest possible measures and
solutions to these problems. The information obtained is expected to be promptly available to the
responsible authority (primarily BSMEPA and MEET). The meaning of this is to enable these
authorities and other competent public institutions, if they consider it necessary - to take timely
"corrective actions" to support achieving the objectives of the Strategy.
It should be underlined that if monitoring focuses on the observation of: (a) actions taken and
resources expended, (b) results achieved, (c) carrying out the process in time, (d) the effects
received, assessment is aimed at determining 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:
- Compliance with the schedule of activities;
- Volume, speed and degree of resource use;
- Achieved results;
- Achievement of objectives and impact of the strategic document.
When to monitor? - The aim of ongoing monitoring is to record the effects and deviations from
planned levels early enough, so as to allow their correction before their consequences become too
serious to be overcome. What should not be forgotten is the need for monitoring to be performed
frequently enough to allow adjustment of deviations from the plan followed.
Based on this methodology, monitoring and assessment of the implementation of this Strategy
involves the following sequence of actions:
49
1. Selection of criteria and indicators for monitoring and assessment;
2. Monitoring of performance;
3. Comparison of achievements and targets;
4. Proposal and taking of corrective actions.
In compliance with the adopted objectives and measures in the Strategy for sector “Manufacture of
chemicals and pharmaceuticals”, the following key indicators for monitoring and assessment are
proposed:
Prepared criteria and list of export-oriented companies are uploaded on the National
Export Portal
Easy and fast access to information for development of the sector and SMEs in it
Number of enterprises using the informational database, uploaded on the National
Export Portal
Number of enterprises satisfied with the quality of information available
Number of companies applying for financial support
Number of trained export specialists
Number of trained experts for participation in international exhibitions
Number of enterprises with obtained certificates
In the assessment criteria of project proposals, export potential is explicitly specified
Created at least 2 export clusters
Increase on annual basis of export contracts with invited foreign trading partners
Increase in the number of export contracts for products from the sector, produced by
SMEs, as a result of implementing the working procedures of trade representatives
Increased number of export contracts as a result of 1 event (exhibition, fair, etc..) -
average per event
Number of developed and adopted models for entering new markets by SMEs
Surveillance and monitoring of progress will be carried out by BSMEPA, which is the "owner" of
the Strategy. To this end, the Agency will assign particular responsibilities to an official in its
administration to collect information necessary for monitoring the implementation of the measures,
who will make annual reports to the Executive Director of the Agency.
Annual reports will serve as interim assessments of the Strategy. Reports will be public and the
results will be disclosed to the public.