Barely a week after we cheerfully noted how the famous the Herz Salami company had received the EU’s coveted “protected designation of origin” for its “winter salami” news comes that it and at least one other famous Hungarian maker of “tube meats” may be going down the tubes.
Daily Népszabadság revealed last Thursday that Herz has informed the labor authorities that it will lay off 130 workers due to financial problems. The company has debts totaling Ft 4 billion, which it has been unable to reschedule, and to date the state has not indicated whether it will step in with new loans. We’d say you should rush out and buy some of its famous téliszalámi, but due to its money problems it is apparently having trouble keeping up production. Meanwhile, on Sunday the paper reported that the equally iconic Gyulai Húskombinát may go bust if it cannot find new working capital.
The company is carrying less debt than Herz – Ft 1.8 billion – but it was running in the red last year, even before the current crisis hit. Part of the problem may be overstaffing; it employs 500 people to make just Ft 8.5 billion (roughly €30 million) of sausages, and its losses came to Ft 500 million – or a cool Ft 1 million per employee, which works out to a lot of sausages. [Photo via Martin Ujlaki/Flickr]
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