At the end of the last week in BTA was held a press conference of the Federation of Bakers and confectioners in Bulgaria (FBCB). During the event  became clear that the Federation insists on bring in knock-down production prices for the bread and abolish DDS for the bread and baker’s goods producers. We give you the opinion of the Chair the Federation Mrs. Mariana Kukusheva of these and other problems, shared for Econ.bg.

Mrs. Kukusheva, what are the general demands of the  Federation of Bakers and Confectioners in Bulgaria (FBCB)?

Mariana Kukusheva:

The main demand of the FBCB is bring in knock-down protectoral prices  of the bread. This is due in order to liquidate  the “gray” sector, all the companies to have equal start and to start talking about quality. Every manufacturer will produce their goods not  because of the low price but because of the quality , which means now  that the manufacturing process is not under control.

What  is the mechanism that will eliminate the “ gray” sector?

Mariana Kukusheva:

The knock-down protectoral price will  eliminate the “gray” sector, because everyone who deliver goods on this price will have to prove the control organs of the state which exist and are going to develop more in the Food Agency, how this prices is reached. How are they paying their taxes and insurances, how they gain profit like a type of economic mechanism, how they do their transportation expenses- are the excises paid.

Which are the reasons for reduced bread consumption?

Mariana Kukusheva:

The reduced bread consumption is due to many reasons. First the population of the country had, reduced, the sector that offer macaroni goods got bigger. Moreover, pizzas and sandwiches hold a big percentage of the paste goods. It’s normal the consumption to be reduced, which doesn’t bother us. The fact that the criteria of the bread consumers had lowered is bothering us. This is disturbing because the bread is in the foundation of the food pyramid and the criteria of the bread should be leading when putting on the table.

If we ask the people from the capital in an ordinary shop, if they are sure in the quality of the bread, what do you think they will answer?

Mariana Kukusheva:

I expect most of them to say “no”. It is because people don’t have the mechanism to define which bread is healthy and which not, unless they have inside instinct and with taste receptors. This is the reason why the Federation brings in our trade mark for quality and safety. It is a gesture to the consumers, media and all the people that use our products. Its bringing in will means that we are responsible and we state: “Yes, this product is made  in clearness and it is easy to follow the manufacturing process”.

During today’s event became clear that 60 % of the bread manufacturing  is in the “gray” sector. This means that most of the bread is not with good quality. Which is the biggest violation that is being made. What is the thing people don’t know?

Mariana Kukusheva:

When people buy bread they don’t know where goes the money from it. They don’t know from what it is made and from what kind of wheat. The good news is the  bread is always made from one raw material – flour.

Replacement for the flour is not made so far, not like other goods for the daily meal. But where does it came from, from what grain, in which conditions is reserved, how is it made, what it contains- consumers couldn’t know. This is a matter of personal responsibility of each manufacturer, which responsibility is temporally since  the system of analysis of danger and critical points.

Why do you want the patent tax to drop off? Will this help reducing the “gray” sector?

Mariana Kukusheva:

It’s not normal the food manufacturer to be registered of patent tax I case he provides product which brings its DDS.  The deductions of these goods don’t go in the state budget. The raw materials which he buys ( the manufacturer) are with DDS. How come he doesn’t have payment to the state budget and he has to pay one time a tax with anyone checking his profit, because there is no legal right for that.

The new outlook of the “gray” sector is like that. There are companies that manufacture bred, paste and confections in which the main activity is different from the food sector which means there is now way they could be checked, because they are not registered on the Food law. For example a company that is registered to produce nails, actually manufactures bread. I won’t give you the name of the company because it is not  polite.

Bringing in the  knock -down prices is  protecting the manufacturers and  some how is showing the “gray” sector how the consumers will be protected? Who is going to control the market price of the bread?

This is a market mechanism  and I can’t give you the exact form of it. But it is not obligatory to talk about trade charge. It is good talk about trade reduction , which are legally defined. It shouldn’t just a matter of pressure of some traders against a number of manufacturers. Every manufacturer has the chance to provide different reduced price and there is nothing wrong with that. This doesn’t make him unequal but he can go up not only because of the price bit with quality.

If you continue thinking of the bread as a good, that obligatory brings trade charge in it, your expectations are right- the consumer will be harmed. But I personally think of the bread as a everyday good which brings trade reduce inside.

Will the possible bring in knock-down production prices rise the cost of the bread?

No way. We will stop talking about trade charging. May be we will start talking about reasonable trade reducing and for quality. The quality regulates the price of the whole European market and may be the international one. The quality defines the market, not the price.  

Wouldn’t this protectoral price kill the competition?

Mariana Kukusheva:

The competition is the best thing that could happen to a manufacturer and in a business as a whole. If there is no competition – make it your own so you can have someone to compare with. The protective price won’t kill the competition because it will run in a new higher level- on the level of quality and verity of the products. There are 68 types of bread in Bulgaria and 18-20 types of weight. Can you imagine what kind of variety of products we are talking about and how uncatchable are the bread prices this way- spread in 18-20 types of weight.

During the conference you said that the manufacturing price of the bread of the companies in the “gray” sector is between 0.35lv and 0.50 lv. Is such price normal?

Mariana Kukusheva:

Yes, that’s right. This is the topic of this “hot” conference- to inform you with our fresh suggestions. 0.35-0.50 lv. is disturbingly low price which the consumers don’t realize. It is important the consumer to know that when he buys bred for 0.85-0.90 lv. someone in the section earns a lot without paying for it.

What is the normal production price which at the moment guaranties that the bread which the consumer buys is qualified?

Mariana Kukusheva:

We cannot talk about averaging price. It is not lower than 0.85lv. This price is different for each producer, because it depends on his personal opportunities and characteristics.