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Eastern Europe: Survey Of Cities Shows Where Bargains Lie

  • Don Hill



Prague, 2 December 1996 (RFE/RL) -- Where can a thirsty Scot buy a single malt whisky in a bar for the equivalent of $1.50? Where can a linguistically-challenged U.S. businessman hire a bilingual secretary for $100 a week? And where can a homeless German executive rent a two-bedroom apartment near the city center for about $550 a month?

In Tirana, Prague, and Minsk, respectively, according to a study published recently in London.

If you are an air express company that has been operating in Eastern Europe since seven years before the collapse of communism, such questions assume considerable importance. And if, in addition, you build a significant share of your market upon Western-based companies dealing with and operating in Eastern Europe, being able to answer such questions becomes an essential part of your marketing strategy.

With those considerations in mind, the London office of DHL Worldwide Express earlier this year commissioned a market research firm to study comparative costs of living and doing business in key Central and Eastern European cities and in selected Western European capitals.

When the company made its results public recently, the findings received substantial press attention -- which, of course, was part of the idea -- even though some of the data consisted of what American market research firms sometimes call "grandma research." ("My old grandmother could have told me that.")

It was no surprise, for example, that Moscow proved to be "by far the most expensive capital for Western business executives. . . , almost three times as high as London."

Less obvious, however, is where the bargains lie. Says the survey: "Prague, Czech Republic; Kishinev, Moldova; and Bratislava, Slovakia, are actually cheaper than London."

DHL looked at costs in Moscow, Tirana, Budapest, Kiev, Ljubjana, Skopje, Belgrade, Bucharest, Kishinev, Warsaw, Sofia, Minsk, Prague, and Bratislava. It considered the price of a room in a top hotel, a local telephone call, a week's work from a bilingual secretary, purchasing a desk, renting an apartment, buying a computer, taking a taxi, making a telephone call, and drinking a Scotch.

Except for the booze, Tirana turned out to be the costliest city in the region after Moscow, Bratislava the cheapest.

DHL first brought its air express service to Eastern Europe in 1983, when it opened shop in Yugoslavia, at the time the most Westward leaning of the nations in the Soviet sphere. Now it operates 165 stations in Eastern and Central Europe.

The company set up service in Prague in 1986 in what then was communist Czechoslovakia. Under the politico-economic order of the time, it operated with a Czechoslovak partner granted a monopoly by the regime. In 1990, DHL went into business in Prague on its own.

Accuracy of the survey's findings were not self-evident everywhere, even to foreigners working in DHL's offices. Told that Prague was identified as a bargain city, Netherlands native Robert Steenhoff, DHL commercial manager in Prague, said with a touch of skepticism: "Is that so? It's nice to hear."

DHL has five Western managers among the more than 300 employees in the Prague operation. The city is low in cost, Steenhoff conceded, but, he said, outlays rise rapidly when the Westerners seek to duplicate their Western lifestyle in the Czech capital.
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