Croatian food industry is one of the most significant strategic segments of the whole Croatian industry. However, the largest producers in Croatian food industry are still large lapsed enterprises formed before establishment of market economy. Hence, our purpose is to present the state, role and potential of SMEs inside the industry. The analysis of the role of SMEs is shown through data about the number of enterprises, their size, rate of unemployment and revenues in the past ten years (1996-2005). As Croatian SMEs faces a new competitive environment the strategic models of their cooperation for larger competitiveness are considered
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