November the 15th, 2021 - Online shopping has always been the favourite way of getting things done from the comfort of your own home in other parts of Europe, but until recently, more precisely until the coronavirus pandemic erupted, it lagged here in Croatia. Things have now dramatically changed and numerous big players are entering the Croatian e-commerce world.

As Novac/Jutarnji/Bernard Ivezic writes, the growth of Croatian e-commerce is fast heading towards numbers around the one billion euro mark next year, and as the hasty entry of large foreign players has flooded the Croatian online shopping market, an equally significant number of interesting shifts in the domestic market have taken place.

The Orbico Group, the largest domestic distributor and the second largest company in all of Croatia after Fortenova (formerly Agrokor) has entered the world of Croatian e-commerce. Orbico's web perfumery FABUspot, launched only this year, has already reached third place according to user ratings at the Web Retailer Award 2021, the largest e-commerce competition in the entire Adriatic region, which was organised by Ceneje.si on Friday in the Slovenian capital city of Ljubljana.

Data on the operations of FABUspot are encouraging, and the Croatian Orbico Group has doubled its revenue in the last five years alone. Last year, it reached an impressive 18.2 billion kuna, which put Orbico ahead of the INA Group, making it, as mentioned, the second largest domestic company after the gigantic Fortenova.

Another big surprise was prepared by Ivica Todoric's former flagship and the enterprise that was supposed to save the entire company, the Abracadabra web store, ie A007 Plus.

Abracadabra was declared by Fina as having the highest revenue growth of all major online retailers in Croatia, of 124.3 percent, a figure of 21.6 million kuna. For comparison, the fastest growing retailer in recent years was otherwise the popular Bazzar.hr, ie the company Prati me (Follow me). But in the pandemic-dominated year, it grew by 100.7 percent. Despite this welcome title, Abracadabra isn't actually operating positively. Last year, it increased its losses to 9 million kuna, and last year, Bazzar.hr increased its net profit by ten times to 522,105 kuna with revenues of 50.6 million kuna.

The third big surprise for the rapidly growing world of Croatian e-commerce is the new record set by eKupi (eBuy), the largest domestic online store of all. Back in 2020, the company within the M SAN Group increased its revenue by 25.9 percent, to 50 million kuna, or 374.3 million kuna. In addition, it generated a net profit of 4.5 million kuna.

The company eKupi, according to the assessment of the Polish Allegro, which entered the Croatian market with the acquisition of the Mall Group (of which Mall.hr is a part), is the largest domestic player on our market. Allegro estimated it to hold 11 percent of the market. The largest online retailer in Croatia is the Chinese Alibaba Group. The owner of AliExpress holds as much as 24 percent of the share in the Croatian market.

The great interest of foreign players for the Croatian market, especially those from Slovenia, the Czech Republic and Germany, can be seen from the selection of the Web Retailer Award 2021. Many of them are already present in Croatia, however, this choice also shows that smaller Croatian players are working on the development of their own respective web stores and are achieving continuously better results.

The company Smart Trade from Sesvete near Zagreb, whose web store Namjestaj.hr (Furniture.hr) was rated the best in the entire industry, last year increased its revenue by 9.7 percent, to 147.5 million kuna, with a doubling of its net profits to 4.6 million kuna. The company DDL Zagreb, whose pet store PetHomeShop.hr was rated the best in its industry, last year recorded revenue growth of 15.8 percent, to 54.9 million kuna.

For more, check out our dedicated business section.

November the 13th, 2021 - The Croatian company Infobip, the country's first ever unicorn, now also has the largest number of shareholders. This Vodnjan-based company has gone from strength to strength and made truly remarkable progress, and it seems that isn't slowing down yet.

As Novac/Bernard Ivezic writes, the Croatian company Infobip has moved one step closer to the stock market. It is no longer just the first Croatian unicorn and the largest domestic startup to date, but also the one with the most shareholders of all. Infobip has also now launched its own ESOP programme for all of its employees, more than 3300 of them.

This impressive cloud communications company has announced that it will automatically apply the employee shareholder programme to all of its future employees.

Silvio Kutic, the co-founder and CEO of the Croatian company Infobip, says that ESOP is the most important initiative that rewards employees for their contribution to the evolution of the company through compensation in addition to their salaries.

''ESOP is a key part of the value offer of employees and that's why it's my honour to have the privilege to state that we've reached the point where we can make all employees part of our story of growth as shareholders,'' explained Kutic.

The Croatian company Infobip has had an ESOP before, but it's questionable as to whether it can be called that given the fact that it was very limited in scope. It was valid only for individual, key employees, estimated to number about 800. Now, however, the programme has become a company-wide standard and has included an additional 2,500 employees.

ESOP (Employee Stock Ownership Plan) is a programme by which companies add the option of acquiring an ownership share to employees' salaries. It is used as a form of reward and a tool for retaining staff.

Although one of Podravka's is considered to be one of the most successful ESOP programmes in all of Croatia, this type of employee reward programme is currently the most popular in the entire IT industry. According to a survey which was conducted last year, as many as thirty domestic IT companies have embarked on various ESOP programmes. Infobip was the first to do so, followed by Nanobit, while Rimac Automobili announced that they were moving in that direction as well.

Nanobit also made an ESOP but also of a limited scope. As was learned last year, Nanobit allocated 5.57 percent of the ownership stake to 30 percent of the company's employees. The programme, as Alan Sumina, the co-founder and CEO of Nanobit, explained at the time, rewarded people who proved to be key to the company's growth as well as a motive for attracting potential staff from elsewhere to come and work for the company, especially in the City of Zagreb.

For the listed companies, the option to acquire an equity stake is usually activated in preparation for the IPO. The Croatian company Infobip is planning its IPO for the end of 2022, ie the beginning of 2023. Then, just before being listed on the stock exchange, employees can convert their options into ownership shares and thus become "real" shareholders of the company after the IPO, meaning that they can then sell the shares they have thus acquired and thus generate additional income.

It should be emphasised that there are numerous variations of the ESOP programme, and some companies share such options with their employees, while some, as is the case with the IT company Span, which recently went public on the Zagreb Stock Exchange, have offered their employees the option to purchase shares on preferential terms. Regardless of which ESOP implementation model both companies and employees have chosen, this is a more tax-profitable way of increasing additional income in Croatia.

From Infobip, they explained that their ESOP plan is designed as an addition to the current employee compensation packages, and this means that it is the so-called optional ESOP model. Infobip launched the programme four years ago and back at that time, a 10 percent stake in the company was allocated to reward employees, but the entire package was not distributed at the time, as the ESOP was applied to a limited extent.

Kutic explained that this is a confirmation that the organisation is now in the next phase of the path of exponential growth, and if we quickly recall, it's worth noting that Infobip's revenue jumped 57 percent last year to 1.25 billion dollars or 7.74 billion kuna.

After receiving a 300 million US dollar investment from the US fund One Equity Partners in 2020 and taking over OpenMarket for that same sum, this year it bought the Split conference franchise Shift, and then the world's leading SMS firewall service provider, the Irish Anam Technologies. The value of these transactions hasn't yet been disclosed.

Recently, the Croatian company Infobip also took out a 500 million dollar loan from funds managed by Ares Management Corporation and funds managed by BlackRock, it also took over one of the largest alternative telecoms in the USA, Peerless Network. The company has made it clear that it will continue to take over and merge with others in the coming period.

''Our goal is to ensure that everyone is fully active in the implementation of our ambitious growth plan that we intend to carry out over the next few years, because in this way, employees will create value not only for the organisation but also for themselves as individuals,'' concluded Silvio Kutic.

For more, check out our dedicated business section.

November the 12th, 2021 - The Croatian Greyp bikes, the largest individual owner of which is much loved entrepreneur Mate Rimac, has seen continuous and steady growth, even in spite of the coronavirus pandemic.

As Poslovni Dnevnik/Sergej Novosel Vuckovic writes, this Sveta Nedelja-based company has grown 110 percent in recent years, this year that growth will exceed 120 percent, and the Croatian Greyp bikes company working seriously on its first city model, the electric citybike, which should be on the roads of the cities and streets by early 2024.

This was revealed on the sidelines of the first inter-industry discussion on sustainable business, launched by Nestle in Croatia, by Vladimir Karmelic, the marketing manager of the Croatian Greyp bikes company. The new model should be predestined for city driving and be more affordable, according to Karmelic. Existing models are more for mountain and trekking activities.

"With the development of technology that is our primary focus, we can see that the next step for the bike is to have it be an everyday companion to the rider, it will have navigation that warns of pollution on the route, informs the rider where there is traffic and crowding in the city and recommends green routes,'' Karmelic stated when describing the future Greyp bike, a vehicle which is set to fit even more into the story of sustainability and the eco profile that the company believes so strongly in.

This year at the Croatian Greyp bikes company they can be very satisfied indeed with the irnumbers, they have sold, all over the world, 1500 of their most popular model, the G6, the older G12 was about sixty models sold, and the latest, presented this summer, the T5, has seen about 600 copies sold. Unlike the vast majority of companies, the pandemic has actually helped them due to increased demand, but, they admit, also slowed some things down because parts factories in Vietnam and Thailand ended up being closed.

Due to global disruptions in supply chains caused by that same public health crisis, they have experienced difficulties with the procurement of certain components, especially technological ones important for connectivity, which also affects the delivery of finished products. But unlike their competitors (including “regular” manufacturers), which have also experienced significant delays, Greyp bike customers are already aware that they'll have a wait of around two months on their hands after making their purchase.

For more, check out Made in Croatia.

November the 11th, 2021 - The Croatian Chamber of Commerce (HGK) has awarded its 2020 Golden Kuna awards (Zlatna kuna) to numerous Croatian companies which have experienced success and aided the domestic economy during the unprecedented and extremely challenging coronavirus-dominated year of 2020.

As Poslovni Dnevnik/Suzana Varosanec writes, the Croatian Chamber of Commerce's 2020 Golden Kuna awards were awarded recently for the 25th time, at a ceremony which could only be attended by those possessing covid certificates at Zagreb's Westin hotel. The winners are in eight categories - for small, medium and large companies, the most successful bank and insurance company, for innovation, for responsible and sustainable business and for what's known as ''life's work''.

Dok-Ing is rather unsurprisingly the winner of the 2020 Golden Kuna for innovation, PBZ (Privredna banka Zagreb) has been proclaimed the best Croatian bank of last year, and Croatia osiguranje (insurance) has been declared the best insurance company of 2020.

When it comes to being awarded for responsible and sustainable business, Jadran - Galenic Laboratory took home the 2020 Golden Kuna award. Zagreb's Gamepires won the same in the small business category, G.T. Trade from Split won in terms of the best medium-sized company, while HS Produkt from Karlovac won as the best large company. Special awards and recognitions were also presented along with the 2020 Golden Kuna awards.

The Croatian Employment Service (CES) has won an award for its efficiency in implementing government economic measures to preserve jobs due to the pandemic which were readily introduced last year. Dragutin Kamenski, the owner of the construction company Kamgrad, received the 2020 Golden Kuna for his life's work. The Croatian Chamber of Commerrce also presents the Golden Kuna awards for business success and contribution to the domestic economy.

The list of nominations is based on the calculation of established indicators, and the business image of domestic companies, the impact on the development of the activity to which they belong and the contribution to the development of the Croatian economy as a whole are adequately evaluated.

For more, make sure to check out our dedicated business section.

November the 8th, 2021 - Five Croatian companies are suing the state as a clap back against the epidemiological decisions made by the National Civil Protection Directorate in the face of the ongoing coronavirus pandemic.

As Poslovni Dnevnik writes, Tomica Drvar from the Svikoncerti (Allconcerts) agency said on Dnevnik Nova TV that they're seeking compensation for what he believes are ''double standards''.

''For example, we as travel agencies didn't receive any compensation for any drop in traffic we had, but only for preserving jobs,'' explained Tomica Drvar, who will sue the state because he believes that the government's economic measures and the way they're handed out is not fair. Tomica's travel agency's traffic has dropped 97 percent over the last two years, and the loss stands at about three and a half million kuna of revenue per year.

"It's difficult for us to say how much we would be satisfied with. All Croatian companies have their individual own revenues and expenses, but I must emphasise that our state has done absolutely nothing to compensate its businessmen and company owners,'' he added.

In addition to Tomica, four other Croatian companies are filing a lawsuit against the state with the same request. They're playing the card that the state has violated the constitutional rights of business owners with the decisions made by the National Civil Protection Directorate, but also in the way they have introduced economic measures. Specifically speaking, they're referring here to articles that say that no one can be brought into a position in which they're being discriminated against. All of this is going ahead with the support of the Voice of Entrepreneurs Association (Udruga Glas Poduzetnika).

“So, they gave people grants to preserve jobs, but that all went on workers, and the compensation that Germany or Austria gave to their companies was simply lacking in Croatia,'' explained Branka Prislic from the Voice of Entrepreneurs Association.

The state rejected a peaceful solution to the dispute, according to them. There has so far been no comment on the matter released from the Ministries of Justice and Labour so far, which is not surprising given the statements of their boss on this issue.

"I think we've done everything that the state could have done in these circumstances," Prime Minister Andrej Plenkovic said back in July.

Rejecting that claim, the heads of five Croatian companies say they are ready to go all the way to the European Court of Human Rights on this issue. They haven't specified the exact financial amounts they're seeking, but as has since been found out, it is at least hundreds of thousands of kuna in compensation per company.

For more, make sue to check out our dedicated politics section.

ZAGREB, 7 Nov 2021 - In 2020, enterprises in the Osijek, Rijeka, Split, and Zagreb urban agglomerations netted HRK 16.2 billion in profits, or 77% of the profits of all enterprises in Croatia, according to an analysis by the Financial Agency.

The agglomerations were established in 2015 and 2016 under a decision of the Regional Development and EU Funds Ministry.

In 2020, the biggest consolidated net profit was generated by enterprises in the Zagreb urban agglomeration (HRK 14.3 billion), followed by Osijek (HRK 804.1 million), Split (HRK 631.6m), and Rijeka (HRK 399.8m).

Of the 139,009 enterprises which submitted annual financial statements for last year, 79,229 were based in the four urban agglomerations, up 1.8% in 2019. Most were in Zagreb (55,282) and least in Osijek (4,476)

Of the 947,874 persons employed in enterprises in 2020, 566,310 were employed in the four agglomerations, the most in Zagreb, 430,965, or 7.8 employees per enterprise on average, and the least in Osijek, 30,930, or 6,9 employees per enterprise on average.

Last year, enterprises in the four agglomerations made HRK 512.3 billion in total revenue, down 5.5% in 2019, and accounted for 68.9% of the total revenue of all enterprises in Croatia (HRK 743.8 bn).

Their profit totaled HRK 32.5 billion, down 4.4% in 2019, while total losses went up by 45.4% to HRK 16.3 billion.

In 2020, the highest average net monthly salary in enterprises in the four urban agglomerations was in Zagreb, HRK 6,796, 5.2% more than the average in all four and 13.8% more than the average in all enterprises in Croatia, which was HRK 5,971.

The lowest net monthly salary was registered in the Osijek urban agglomeration (HRK 5,155).

(€1 = HRK 7.5)

For more, check out our business section.

November the 7th, 2021 - The very first Croatian mobile wallet Aircash is now offering its users pre-paid cards. Aircash was a real novelty here on the Croatian market, and it seems they're now set to go a step further.

As Bernard Ivezic/Novac writes, Aircash, the very first Croatian fintech to launch its own mobile wallet, has now become the first domestic startup to issue its own card. The Croatian mobile wallet Aircash presented its partnership with Mastercard in the City of Zagreb on Thursday, and as a result, Aircash now offers a Mastercard card in addition to its mobile application, similar to the cards offered by the British company Revolut and KEKS Pay from Erste Bank.

Hrvoje Cosic, the founder and director of Aircash, says that this made them the first financial player in all of Croatia to issue Mastercard cards without actually being a bank.

''These are prepaid cards that are exclusively related to Aircash wallets and the balance on them, they have no fees, and we don't plan to introduce any monthly subscriptions and thus believe that we have a market and price competitive product,'' said Cosic, adding that they set a precedent here on the Croatian market in terms of distribution. The cards will not be ordered, as they typically are with other applications, but an empty Mastercard card will be purchased at a kiosk, fuel station or store and is then activated through the Aircash application by scanning the QR code.

''Thanks to that, the card becomes active immediately, it's then connected to the funds available to the user in their Aircash wallet and it can be used to pay for things anywhere in the world,'' explained Cosic, adding that the card can be managed within the Aircash application. This means monitoring and controlling consumption, setting a limit and all this is instantly applied.

Two years ago, this Croatian startup received an EU license for electronic money from the CNB and thus offered its mobile wallet services. It then contracted cooperation with a number of retailers from the Croatian Lottery through HAC to Telecom. Since the beginning of the year, the Croatian mobile wallet Aircash has increased the number of users in Croatia by 70 percent to more than 200,000. In total, it is closer to the number of a quarter of a million users, because it also has many users in Slovenia and Austria.

For more, check out Made in Croatia.

November the 6th, 2021 - The Croatian Orbico Group, which is otherwise Europe's largest distributor of consumer goods with more than 8,000 employees, grew by 120 million euros during the first year of the coronavirus pandemic, an increase in revenue compared to pre-pandemic 2019.

As Poslovni Dnevnik/Suzana Varosanec writes, the owner of the Croatian Orbica Group, Branko Roglic, confirmed this recently, adding that this record achievement is simultaneously accompanied by integrative processes that have affected the entire system this year.

In all 20 countries in which Orbico operates, the integration of the group's components has been carried out, so that the business is run by over 20 companies on the principle of one company in each country, instead of the 47 that previously operated within Orbico.

Although the structure of sales is changing with the movements of the coronavirus pandemic, with e-commerce reigning strong and standing at around 10 percent for Orbico, trade isn't slowing down either. The growing trend of demand for all types of goods is met by the transformation of business through the processes of digitalisation and robotisation, including investments in logistics.

Over the past five or six years, the Croatian Orbico Group has practically doubled its revenue, and today, as Roglic himself points out, they're the second largest Croatian company (after Fortenova), as well as in terms of total revenues, as in 2020 they even exceeded INA by 4 billion kuna.

They ended the first pandemic year at 18.2 billion kuna (about 2.5 billion euros) in revenue, with the growth trend, which normally ranges from 5 to 10 percent per year, continuing. According to the business plan for this year, the level of total revenues is set at a record three billion euros, and Roglic says that the realisation so far confirms that the Orbico Group will fulfill their target with no issue.

"We're growing the most in the market of Romania, where the revenue is around 750 million euros, and Poland, Hungary, Bulgaria and of course here in Croatia. But Orbico's recipe for success in all markets is the same - it's a move away from politics and a commitment to engaging in clean business with a focus on employee satisfaction. Politics "feeds" on the surplus value that business people create and thus reduces the possibility of the development of the company, as well as society as a whole,'' explained Roglic, adding that the generator of progress is the surplus value created by companies with their employees, preferably at the lowest cost possible.

Plans for further expansion into new markets include the market of Azerbaijan, and as far as acquisition-based growth is concerned, the plan is to take over a strong European digital e-commerce platform. Obviously, the next target for the Croatian Orbico Group is to strengthen their share of online sales, which has been flourishing during the pandemic, and Roglic has since announced the purchase of a large distribution company that has strong activities on online platforms. This is planned to be done in 2022, which would bring Orbico's share of online traffic to a mark which will exceed 20 percent.

They're also expanding their logistics capacities with constant investments, with a low indebtedness rate (1 percent EBITDA), and this year they have joined new logistics centres in Poland and Bulgaria with investments of around 25 million each kuna, with their warehouses covering areas of around 200,000 m2.

Next week, Roglic will travel to Bulgaria himself to open a new logistics centre near Sofia, with a strategic emphasis placed on the process of the automation and robotisation of the logistics services. A new logistics centre spanning 23,000 m3 has already been opened in Poland this year, which is also automated and robotised entirely.

"When it comes to our new projects, the focus will be placed on cooperation with developers who are building new logistics capacities, while through the lease, we pay for the investment and with the expiration of the contracted lease we can extend or take over the centre,'' explained Roglic.

The Croatian Orbico Group's tender for the construction of a logistics centre that will cover the needs of both Croatia and neighbouring Slovenia is underway in Zagreb, and will emerge according to the aforementioned model. It will be their fifth logistics centre and will be worth about 20 million euros in total.

For more, check out our business section.

November the 6th, 2021 - As the pandemic starts to bite again in Europe as the colder weather sets in and the threat of new measures looms, could the likes of Egypt and Uzbekistan represent new Croatian export opportunities? Some in the know believe so.

As Poslovni Dnevnik/Suzana Varosanec writes, despite the impact of the ongoing global coronavirus pandemic on business throughout 2020 and this year as well, in the first three quarters of 2021, more than 111 million kuna of new business was successfully concluded, confirmed the Institute IGH's business report on the first nine months of this year.

The company, with a healthy core business and strategic guidelines for the coming period, in addition to challenges in the Croatian market where it participates in some of the largest infrastructure projects, is focusing its activities on expanding business outside the borders of the Republic of Croatia, with the goal of sustainable growth and further development.

At this stage of internationalisation, their focus is on announcing strides in new markets across Africa and Central Asia, mostly through the opening of representative offices in Egypt and Uzbekistan, where, they say, new, significant infrastructure projects are expected.

From January to September, the IGH Group generated revenues of close to 140 million kuna, but as they announced, they also recorded close to 170 million kuna in expenses, which resulted in a negative result.

IGH d.d. itself, according to the report, is actively pursuing a policy of increasing liquidity and shortening the period of settling liabilities to suppliers and subcontractors, and collecting its overdue receivables. Their trade receivables increased by more than 5 million kuna when compared to the end of 2020, to 26.5 million kuna at the end of this reporting period.

After the depreciation expense of 14.5 million kuna, the negative effect of interest expenses and exchange rate differences of 4.6 million kuna, IGH's net loss stands at 28.2 million kuna, arising primarily from pre-bankruptcy liabilities and settlements. The impact of this on the group's result in the third quarter of 2021 is visible through a net loss of 51.8 million kuna.

If Central Asian and African nations could see Croatian exports succeed, then it would be a more than excellent opportunity for Croatia and Croatian companies to be recognised on an even more global scale than is currently the case.

For more, check out our business section.

November the 6th, 2021 - The Croatian eKupi online retailer has introduced a new and innovative service for its users which is similar to something Croatian post (Hrvatska posta) introduced not so long ago - package machines.

As Poslovni Dnevnik/Sergej Novosel Vuckovic writes, the Croatiane eKupi online retailer has taken a step further in improving its user experience, the very basis of the shopping experience. They are introducing eKupi package machines, following, for example, Hrvatska posta, DPD and GLS, which already have them in operation.

The first eKupi "devices" to which goods purchased over the Internet can be picked up have been placed in front of the eKupi headquarters in Buzin, Zagreb, and in total there will be more than 15 of them across all major cities in the country. Depending on the needs, additional regions will also be strengthened in time.

“When buying something via the Croatian eKupi online retailer, the customer will be able to order an item with free delivery and collection on the eKupi & poKupi package machine or it pick up (at a pick-up point) in their city. Products labelled "immediate delivery" will be available the next business day for pick up after the user receives confirmation by e-mail.

The pick-up at the package machine is easy using the QR code or PIN that the customer receives in the confirmation e-mail that their package is waiting for him them at whatever the location is,'' explained Marija Musicki, eKupi's marketing manager.

The goal of the new option, according to eKupi, is to be even closer to customers and deliver what they want as soon as possible, which, knowing the logistical challenges faced by some in the market, is very necessary.

This is especially the case in the anticipation of the festive season at the end of the year, when consumption picks up its pace, starting from the end of November with the so-called Black Friday, which the Croatian eKupi online retailer has already started preparing for.

"We're preparing in advance for the increasingly intensive sales season, and in addition to the excellent offer at great prices this year, our customers will be able to get their purchased products even faster through our parcel machines and at pick-up locations,'' Musicki pointed out.

As a leading online retailer, their revenue grows every year, and their current expectations are no different. Last year, the 10th year of eKupi's operation, they earned more than 370 million kuna, which was helped by the coronavirus pandemic as more and more people turned to the Internet for their shopping needs.

"We're participating with other stakeholders in the transition of customers from offline to online, the coronavirus pandemic has certainly helped in that and accelerated the process, but this is just the beginning and we have a lot of work ahead of us. That's why we want to build high quality and have the best purchase option, and we're constantly trying to secure a breakthrough. This new service meets the needs of our customers. More than 80 percent of our products are located in our distribution centres and are ready for delivery,'' they concluded from eKupi.

For more, check out our business section.