Croatia's State-Run Toilet Paper Business Allegedly Shows Signs of Life

By , 17 Feb 2016, 09:55 AM Business

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Signs of life for Croatia's beleaguered toilet paper industry.

Despite recent media reports that Croatian state-run toilet paper company is in danger of collapsing, the company representatives claim that nothing could be further from the truth. "The market for toilet papers will always exist and sell products which people need. Also, we want to offer a real Made in Croatia product", that is how representatives of Mekkoo company explain the reasons for starting their business, reports Jutarnji List on February 17, 2016.

Mekkoo is a subsidiary of Narodne Novine, a public company whose core business is publishing the Official Gazette of the Republic of Croatia. Many people wonder why is such a state-run business even being launched in the 21st century in a country which is supposed to be a market economy.

One year after the company was founded, its three-member board of directors was dismissed, and new general manager Dario Kos was brought in. Although the company at first denied the allegations that the management had been dismissed due to poor business results, now they are being more honest.

"The management was replaced for two reasons. The first was the fact that it had been determined that Mekkoo can operate without a three-member board of directors, so we have decided to reduce costs. The other reason is that the management team had not achieved results which were expected. They had problems in terms of distributing the product, while the manufacturing process was not sufficiently efficient. This changes will bring savings and better positioning of the product on the market", said the head of Narodne Novine corporate communications Bojan Vinek.

Narodne Novine have invested 63 million kuna into the business, and plans call for a premium brand of toilet paper and paper towels to be produced by 13 employees in a factory in Krapina.

"The long-term plan is to launch our own brand Mekkoo and place it on the shelves of Croatian retail chains, but that is not urgent, and we plan to do in the next several months. The preparations are extensive and complex, and we will launch it when everything is ready", Vinek added.

The company believes that the investment could pay off in the next six or seven years, depending on how successful they are in distributing their products. "Croatian market includes almost 80 percent of imported toilet paper. We plan to create a product which will be good enough to be able to compete with the most famous brands in Croatia. We are confident that we will win our position in the market", concluded Vinek.

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