Hungarian customers are traditionally European-oriented because of historical reasons and are not familiar with US products in general. The common understanding is that American machinery is ogood quality for a high priceo. Potential US exporters will have to take strong Italian, French and German competition into consideration, when making support, service and pricing decisions. Maintenance, spare parts supplies and support services are of key importance when introducing new systems to the market. Since Hungary is an associate member of and has a free trade agreement with the European Union, most European industrial products get into Hungary duty free, while machinery of US origin is subject to a 10-10.5 percent import duty.
Bigger firms have showrooms and deal exclusively with wholesale trade and stocking distribution.
Agents are also available, and they will typically work for a commission of 10 percent. Based on inquiries with several firms, we feel that in spite of strong price competition, there is a market for advanced U.S. packaging equipment in Hungary. The Hungarian Packaging Award is handed out at this event. The number of exhibitors in 1999 was 182, out of which 57 foreign companies were represented. The total exhibition area was close to 60,000 square feet.