9 Snack Makers Join Forces in Petersburg

ST. PETERSBURG — As far as small business goes, last week was a big one for the local snacks industry.

Nine domestic firms announced Sept. 20 the formation of the Russian Association of Snack Producers. And local company Vitek — one of the association’s founding members — celebrated the opening of a new potato-chip production line.

"Even small businessmen want to be able to work effectively in Russia," said Sergey Volkov, general director of Vitek. "The state should help develop small businesses, or at least leave them alone so that they can work. Small businesses have huge potential, and if the state creates the necessary conditions — such as reducing taxes, implementing a system of privileged credits, and giving them independence from state organizations — small businesses will grow fast."

Maria Nikitina, a Vitek spokeswoman, said that the aim of the new association was to "set up a supply of information to members, and [to facilitate] cooperation over the promotion of snack foods in Russia."

Vitek started operations on the St. Petersburg market in 1992 as a distribution branch to foreign leading snacks manufacturers. It now produces about 40 kinds of snack products.

Maria Ilyushina, Vitek’s marketing manager, said the snacks market is a sector where small businesses are developing fast.

"We had problems with investment at the very beginning, but when we started our own production lines and became a name on the market, it was much easier to convince investors that we had a future," she said.

According to Vitek research, about 35 percent of St. Petersburg and Moscow residents say they consume snacks, a figure far behind consumption in European countries.

"It’s ridiculous," said Svetlana Gavrilova, a representative of Pskov-based association member, Lubyatovo, which produces cereals. "In Germany, the average consumption is 6 kilograms of chips per person per year, whereas in Russia we consume only about half a kilogram per person."

"But our joint attempt to promote snacks and develop a snacks culture should prove effective in raising [that figure]," she said.

Ilyushina said a snack company in the Netherlands provided equipment for Vitek’s new production line as part of a Dutch program to provide technical support to Eastern European countries.

"We also import our raw materials, and this means we can produce a quality but inexpensive product," she said.

Besides promoting chips and other snacks, the association aims "to represent and defend [common] interests in relation to state organizations and on the legislative level," the association said in a statement.

"Our integration into the association gives us status," said Vitek’s Nikitina. "And we will use this to lobby for our interests as regards consumer and tax law."