Discounted prices in the company shop and workers notified that they are on paid leave until the end of July, triggered speculation last week that the Geox shoe factory in Vranje was closing and that the Italian company, which arrived there five years ago, was about to relocate production to another country.
Official confirmation of this, however, has not been made by the Ministry of Economy or the mayor of the municipality of Vranje or the Tehnik Development Company, under which Geox operates in Serbia. Unofficially, the trade unions say that Geox only wants to receive additional subsidies in this situation, just as it did two years ago, when it received an additional two million euro in a similar crisis situation.
As soon as it arrived in Vranje, the state gave Geox 11.2 million euro, as well as 100 million dinars to finance the process of preparing the land for their production facility. According to the decrees passed by the Vranje town council, the Italian company was given land, spanning 110,751 square metres, worth 555,000 euro, for free.
Geox has also received just under 14 million euro in 5 years, if we take into account the initial donation of the land, as well as the two million it was given two years ago. In the five years, according to the financial statement data, Geox spent 4.9 billion dinars or 42.2 million euro on salaries.
Thus, every third salary paid by Geox was actually financed by the state. The salary costs exceeded one billion dinars per year and only in the first year, in 2016, when the company launched production, a total of 760 million dinars was spent on salaries.
For the first three years of full operation, Geox in Vranje recorded good results and the net profit in 2017 was 350 million dinars, 242 million in 2018 and 117 million in 2019. However, last year was not good for the Italians, who annually produce 20 million pairs of shoes worldwide, because the Serbian branch of Geox ended 2020 with a loss of 130 million dinars.
At the same time, the positive financial results coincide with the amount of subsidies, contributions and donations that Geox received from the state authorities, which for the first four years, amounted to over 200 million dinars per year. In the first year, in 2016, the state allocations amounted to 209 million dinars or about 1.8 million euro, the following year they stood at 208 million, 205 million in 2018 and in 2019, 201 million dinars.
This post is also available in: Italiano