Vegetable growers say that in order to sign contracts with the major retail chains, farmers need to ensure an uninterrupted supply of products.
Moreover, only big farms can meet the demand from retailers, therefore it is virtually impossible for newcomers to break into the market, Verslo Žinios reports.
“Those who have been working with the supermarket chains for years, they are the only ones who remain. It is practically impossible for someone new to break through, even if they are offering lower prices, since that triggers a price war,” says Virgilijus Kuprevičius, a farmer from Kėdainiai District.
Product volumes are another criterion which makes it difficult for small farms to land contracts with the big chains.
“Most farmers grow 100-200 tons of vegetable per year. What can you do with that? Our farm produces about 12,000 tons per year,” Kuprevičius says.
However, once a farmer signs a contract with retailers, working with them is not difficult, he adds.