The Czech snack market: Internack vs Pepsico
The Czech snack market: Internack vs Pepsico
Choosing your junk food used to be easy.
During the “shortage economy” under communism, Czechoslovakia was deprived of the variety of prepackaged processed food found in the West. If you wanted a savory snack, your options were simple: salted sticks, peanut-flavored corn or rice puffs or one brand of greasy potato chip.
The 1990s ushered in a tidal wave of junk food, with various players looking to fill the untapped bellies of Czech consumers. One of the earliest arrivals was Germany’s Intersnack, which came to the market in 1992, taking over a potato chip plant in Choustník, south Bohemia.
Intersnack, which is known especially for its potato chip brand Bohemia, has seen the country’s appetite for salty snacks stabilize over the past couple of years, with annual consumption now sitting at more than 3 kilograms per person. Feeding into this, Intersnack’s flagship plant at Choustník turns 40,000 tons of potatoes into 10,000 tons of chips a year.
“The Czech market has been slightly growing in recent years,” said Stanislav Jánský, marketing director at the Czech arm of Intersnack. “The per capita consumption is relatively high compared to other Central and East European countries.”
Accompanying the growth of the snack market has been a consolidation, most recently with two acquisitions made by Intersnack last year. The company bought Canto and Perri Crisps &Snacks, two of its Czech competitors, boosting its market share from 36 percent to 47 percent, Jánský said.
Those deals have helped turn the sector into a race between the two multinationals, Intersnack and the U.S. firm PepsiCo, though the private-label products sold by supermarkets are also establishing a significant chunk of the market.
While Intersnack has courted its customers with a nationally tailored brand, PepsiCo is banking on its global brand Lay’s. The international label, which has its origins in the American South of the early 1930s, is a latecomer to the market, first appearing on shelves at the end of 2004.
Unlike Bohemia chips, which are locally produced, PepsiCo makes all its chips for Central and Eastern Europe in Poland.
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