ECONOMY

Big gaps in competitiveness between industrial firms

The Greek economy appears as a sea of dismally low levels of competitiveness but with a few high-rising islands in its midst, a research study by the Federation of Greek Industries (SEV) has found. The three most competitive companies in each branch of manufacturing lie, as a rule, far ahead of the respective averages, and still further removed from the many small and very small firms dotting their sectoral maps. The SEV study is aimed at helping its members evaluate their performance in relation to their peers, by providing a performance analysis of the three champions of each sector in terms of selected indicators in the 2001-2003 period. Each firm is thus able to compare itself to its peers, examine the reasons for any differences and reformulate its business strategy accordingly. The study was based on a sample of 4,142 industrial companies and evaluates their performance according to nine indicators. The analytical data is available to SEV members only, but the agency has released a list of interesting general conclusions: First, the realm of activity plays no significant role in performance; second, a large gap in competitiveness is found between the few leaders in each branch and the average performer; and, third, the firms with the fastest rise in sales are not, as a rule, those that achieve the best performance in individual indices. Branch champions If 100 is taken as a base for the best three performances in each branch, the respective averages are less than 10 for many branches in six of the nine evaluation indicators. The largest differences appear in the average duration of inventories, return on capital employed and rates of sales growth. The smallest differences are recorded between the best and average performances of each branch as regards profits per worker and gross profit margins. The steepest average annual increase in sales – excepting the recycling branch, which is represented by only two firms – was recorded in the field of medical precision instruments and clocks (32.8 percent). The highest profit rates on sales were found in products made of non-metallic minerals and of manufacturing equipment for radio, television and telecommunication apparatuses. Profits per worker were highest in capital-intensive branches, such as oil refining and nuclear fuels. Return on equity was highest in non-metallic products, while the printing and publishing field performed best as regards operating expenses.