Speck from South Tyrol: An economic evaluation
In South Tyrol are located 35 speck producing companies, 22 of which are members of the Consortium Südtiroler Speck. In 2003, the members produced 21,267 tonnes of speck (equivalent to 95% of the total production of speck), while 10 years ago the production was 10,368 tonnes. This corresponds to an average annual increase of 7.5%, for branded speck even 14.7%. The largest companies (with 50 and more employees) have grown the most rapidly. The fact that the quantity of produced speck has grown significantly faster than the number of employees has led to a significant increase in productivity. However, within food production, the speck sector has developed positively, too. Today the number of employees is almost 1,000, which means that the share of the speck sector within South Tyrolean food production has risen to 19%. And the trend is still positive, on all markets inside and outside the country (Italy and Germany mainly). On the one hand, consumer habits are favouring Speck; on the other hand, the South Tyrolean branded Speck has become an image factor which cannot be separated from South Tyrol. Successful as a brand Especially the amount of branded speck has increased. Meanwhile half of the speck is branded speck. As the surveys show, the Consortium Südtiroler Speck has succeeded in developing the South Tyrolean Speck as a brand. The price for branded speck
(2004) is 18 euros throughout Italy, 10% above the price for nonbranded speck. Already today the Südtiroler Speck is able to stand out from the competition. The highest prices are achieved with small packaging units. There is certainly still potential regarding how convenient, how innovative and how attractive the speck can be to consumers. It would be unrealistic to procure more of the raw material from South Tyrol or to build up significant pig production here. Nevertheless, for image reasons, local pigs should be used as much as possible. What is the importance of the brand? First of all, it is the effect of advertising that the South Tyrolean Speck brings to the whole country. Secondly, the speck production results in jobs, income and taxes. In relation to the economy as a whole between 0.38% (value added) and 0.43% (employees). In comparison to the food sector, the share of speck production is 17% (value added) and 19% (employees). What future? The profit situation (except for some companies) is optimistic. But the competition is increasing. Even closer cooperation is needed. The small speck producers are less aware of the importance of the brand in personal sales to their customers and complain that prices are too low. Furthermore, the path towards quality and transparency must be continued: the customer wants a high-
quality product, marketing and advice (implementing a "SpeckInfo Point" on the Internet?). The presence on the northern Italian, Austrian and southern German markets is already very high, while other markets, including northern Germany, other EU countries, overseas etc. still have development potential. According to the speck producers their target should be new markets with solvent customers. The speck sector has often been a pioneer. Perhaps it should be attempted a sales company on distant markets (e.g. in the USA)?