Croatian managers are very pessimistic about the economy’s exit from the crisis, as unlike their European counterparts who believe the crisis peaked at the end of last year, as many as 60 percent of domestic managers expect this to happen at the end of 2010 or even in 2011, according to a study by the consulting firm Roland Berger.
The research conducted among forty small and medium-sized enterprises from seven different industrial sectors showed that the fight against the crisis in Croatia is still mainly conducted through cost-cutting and attempts to reduce illiquidity, while European companies have focused on business growth and sales initiatives. Croatia is falling behind in securing a better position for the future – it is in a deeper crisis than most European countries and is exiting it more slowly, assessed Vladimir Preveden, the executive director of Roland Berger’s Zagreb office. Croatian managers are primarily combating the crisis through wage reductions, do not see opportunities for breakthroughs into new markets, and expect further deterioration of liquidity. Almost all respondents predict additional reductions in the number of employees, a decline in private consumption, and the introduction of new government measures.
Illiquidity has affected half of Croatian companies, and unfavorable credit conditions are more pronounced in Croatia than in other countries. Despite this, most Croatian companies still do not have liquidity planning, warns Preveden. While most companies worldwide are turning to stronger sales initiatives and measures for business growth, the situation in Croatia is reversed – cost-cutting is still seen as a salvation from recession, and most domestic managers believe that financial institutions and the tourism sector will be the first to feel improvements.
