Caspian Energy CEO: How many years has the company been operating in the market of Azerbaijan?
Elvin Bayramov, General Director, Vostok-Servis Baku CJSC: Let’s start from the establishment of the company. Vostok-Servis was established in 1992 in the city of Moscow. The head office of the company is still in Moscow. The company has started operating in Baku since 2006 and providing working clothes, individual protection means, associated goods and services, etc.
CEO: What could you say about the prospects of development of Vostok-Servis CJSC?
Elvin Bayramov: We started the business, which we are currently doing successfully, 23 years ago. We provide labor safety means protecting workers during production. We feel happy when we find out that products of Vostok-Service are needed, useful and do our best ensure safety of people at working process. Observing the demand for our special clothes, shoes and protection tools inspires us toward new inventions and seeking of the most effective solutions. It is the wishes and requirements of our clients that lie in the basis of the innovative ideas. It is a sort of philosophy of the Vostok-Servis group of companies. Nowadays it covers all areas of life. Together with our business we think of the most valuable thing that exists in this life – life of a human being. Thus, we do our best in order to ensure maximum safety of our people at working places. Sound health is a factor that helps a human being in everyday life. Thus, if a human being misses at least one of the taste receptors, the world seems inadequate to him. In other words, all human organs are vital so that we could live our full life. So, we are happy that the products manufactured by Vostok-Servis play a big role in it. It is of importance when it is plain people or workers secure their life and health by using our products. It is such values as the safety of a human being and his capabilities that our philosophy underlies.
CEO: What have been the achievements of the company throughout its activity? Which tasks have been set for 2016?
Elvin Bayramov: I would liketo notethat nowadays Vostok-Group of companies has 120 branch offices operating in 170 cities with a population of over 100 thou. people. You have seen our show room which is probably one of the most task-oriented ones and I would dare say that it is the most beautiful showroom of special clothes in our city. Vostok-Servis group of companies already has 260 of such showrooms. At present we have 8 clothes factories, 4 shoe factories operating in Russia, Belarus, Hungary and Italy. Our production has been supplied with the equipment of global producers such as Gerber, Desma, FAF and Jacky. Accordingly, we have representative offices in Russia, Belarus, Azerbaijan, Kazakhstan, Ukraine, Georgia, Czechia, Slovakia, Hungary, Romania, Poland, Germany, Italy, Belgium, Denmark, India, Turkey and China.
It is noteworthy that Vostok-Servis is nowadays indeed a global brand. We provide a broad range of services and the company has been named Vostok-Servis not in vain because in addition to production and provision of a product there is also a service for its maintenance. We provide dry-cleaning for our clothes because as it is known, the clothes get spoiled more from washing rather than from using at work. Any person, as a resident, knows that clothes preserve its quality in case of right washing. Apart from this, Vostok-Servis has its own brands which are not few. For instance, there is a brand “ZEVS” meant for protection at welding, “Vostochniye tigri” – production of gloves, “TOFF”, “SPIROTEK”, “I-SPEСTOR”, “SPTES”, “MONBLAN”, “TRAIL”, etc. There is also a well-known company “Cerva” which belongs to Vostok-Servis group of companies. They are producing special clothes, shoes and many other things. The central office of Cerva is located in Prague.
Thus, Vostok-Servis Baku is the only representative of the Group of Companies Vostok-Servis in Azerbaijan and we are offering everything that Vostok-Servis can provide.
In addition to all this, there is an Italian shoe factory Panda Sport Srl., which is also a part of our group.
If you look into our catalogue, you will see that two of our pages “Our brands” and “Our partners” are practically close to each other. So literally we work hand to hand with such world level producers as 3M, Ansell, UVEX, Honeywell, Deb-STOKO, Du Pont, JSP, MSA, NOKIAN, Scott, etc. Thus, there is no competition between us, we simply supplement each other. It is unlikely that you will find the brands and names of competitors in a catalogue of any company. In our catalogue these companies are represented on privileged pages but not in the background. With the assistance of these partners Vostok-Servis manages to fully meet all the needs of the client. As far as the prospects are concerned, a certain decline has occurred in the economy of Azerbaijan starting from the past year until now. It is a natural process since a broad-scale work is currently underway in Azerbaijan in order to develop the non-oil sector. Though, it is noteworthy that we have started developing it quite recently. Considering the character of the global economic history, or the European, all this process has been running for about 10 years, give or take a year or two. The government is implementing a very right policy, but all of it needs time. Accordingly, more time is needed for training the skilled workforce rather than buying certain equipment, delivering and installing it here. It concerns both simple workers and people who manage these companies. Of course it is a little bit difficult to compete with the same Italians, Turks or someone else as their relationship has been lasting for tens and hundreds of years. All this certainly takes time. But Azerbaijan has throughout all this period demonstrating surprising growth rates of its economy owing to a competent and very well-reasoned policy of the government of the state headed by President Ilham Aliyev. Accordingly, it has already started yielding certain results, and I am simply sure that our hopes will be justified in future.
We can have hard times in coming year or two since many things here depend unfortunately on the oil price ration, but we gradually are moving away from it. As the saying runs, nothing so bad in which there is not something of good. It is this situation that makes us work more competent, optimize our certain expenditures and work out new skilful approaches to handle the tasks facing us. We are also transforming, developing and are optimistic about future since an unskilled business is passing away. You perfectly know that in China and many other countries there are many products lacking quality. Accordingly, there is a prerogative of low price there. Some fellows, who are not completely realizing the situation deliver these low-quality products, offer them at the market for a lower price, etc. Why I say “not completely realizing the situation”, because they do not understand that goods they deliver here should protect life of people. It is hard to say that a low-quality product, be it a helmet, gloves or other working clothes and personal protective equipment, can protect a man from harm. Therefore, the other day we provided qualitative products and explained clients the following factor: if you buy gloves for an everyday use, for instance 50 gepik on the common market, we in our turn offer you gloves that cost 1 AZN 30 gepik and serve for 4-5 days. Now make a calculation how much expenditures arise a week, 2 or 3 AZN. So, you save 1 AZN that makes 54 AZN a year. There are companies where the quantity of employees exceeds several thousand people. Just do a simple arithmetic.
In addition to all this a worker’s health safety is the most important thing. The other thing that we are happy with is that we see people studying one moment more carefully. Let’s suppose there is a low-quality shoe put on sale at the market, but I will not call the country-producer. It costs for instance 25 AZN while we offer the same third protection level shoe RAVEN.
It costs 27-28 AZN for an end customer, up to 30 AZN depending on the protection level. The difference is 1-2AZN. On the other hand, some people buy this show and a month and a half later workers start complaining for the water leak, etc., while we provide a guarantee for 6 months or a year. In this way, a manager should either buy three pairs of such shoes or buy one pair and pay a little more. We do not offer products that are offered by others for 25, 50 or 60. An old saying comes to a mind in this case: “I am not that rich to buy cheap products”. This situation influences over the way of thinking of both employers and employees. I think that it is in this aspect we will come into right solutions in future.
CEO: You mentioned about the skilled workforce. Which factor do you consider when taking new employees?
Elvin Bayramov: Nowadays, just like in all other spheres, it is an absolutely normal process when someone expects that it is possible to have someone taught within a short period of time. Let me tell a simple example. When teachers teach small children, who are 2-3 years old, especially when it is a troubled child, they start speaking a little later and teachers pay attention not only to their speech.
Special lessons on movement of hands are held after these small kids start hearing, etc. Over a certain period these lessons start yielding results. Figuratively speaking, it is quite possible to make a skilled human resource out of a person, who has just become a university graduate or who also studied well there, since the process of getting education at the university is very important. It lays a foundation of common mindset of a young person. After he comes to us, it takes 2-3 years to have him trained. But we do not quit on it and practically hold video bridges with our head office almost every week, which conducts certain training. A forum was held together with the Ministry of Labor and Social Protection of the Population of Azerbaijan at Park Inn hotel on May 19 of this year. 7 employees from the head office, product-managers, who spoke in front of our guests, were invited to the forum. Participating in the event were representatives from 100 companies carrying out an activity in the oil-gas, construction and other sectors in Azerbaijan. They spoke about innovations in production of individual protection equipment and special clothes. The process of training should be regular and stopped otherwise it will cease the work of the entire company. It is the reason why we attach an individual attention to this issue, even when we provide services to clients who apply to us. Some companies, especially young companies, who have quite recently entered the market, find it necessary to have a worker supplied with working clothes but they cannot fully understand why he should wear a boilersuit but not a suit, etc. Depending on the protection level, what kind of a helmet, respirator or shoe he needs. And here our employees start explaining them. In order to be able to explain such things, they have to take training on their own. It is exactly what we are doing now.
CEO: Speaking about the current situation in the market, has it affected the activity of the company and implementation of different projects?
Elvin Bayramov: It certainly didaffect certain moments.It did affect because until now and for a few more years Azerbaijan will still be dependent on the oil factor. In spite of all efforts that the state undertakes, time is needed in order to help certain lines of production to get on their feet. Time is needed before the management of these new companies, which already exists or starts its business, gets accustomed to working in the competitive environment. The thing is that a lot of inventions had been made before us. Very many things have been put on stream and we appear in new markets. I now mean not only Azerbaijan but the markets of foreign countries as well. A high quality product for competitive price has to be offered at these markets. This work has to be carried out by managers who can present “Made in Azerbaijan” product in the new market, have an ability to hold negotiations, be aware of the logistics, pricing process, etc.
Many companies start rising at a moment when everything is very complicated. Challenges do exist today, but they are the key to the future success of local companies. We all know that sanctions imposed on Iran shall be cancelled early in 2016. Iran is becoming a very interesting and promising market. Accordingly, many companies, especially oil companies, are already standing on the line. It is official information provided by the Iranian state. According to their statements, they need investments worth about 187 bln USD in coming years. It basically covers many areas because the oil sector has associated sectors which assist the given production. As far as our business is concerned, it is working clothes. I would say even more that Vostok-Servis Company has currently been in the process of negotiations with our Azerbaijani companies in order to enter new markets and develop them as “Made in Azerbaijan” products.
CEO: What has brought you to Vostok-Servis Company?
Elvin Bayramov: Over the past 12 years I have been in the top management of separate companies, leading them, and very often they come in touch with the oil and gas sector, therefore, we had to use the services of the companies representing special clothing and personal protection devices. But I was the buyer of this uniform for our employees. Frankly speaking, I always paid attention to quality, because for me a life of my employee has always been a priority. In addition, I took into account the policy pursued by the state in relation to an Azerbaijani family. We have values that we can never see either in Europe or in the CIS countries and in Asia. Azerbaijani family is an amazing institution. Certainly, my employee is also part of a family. Azerbaijani families are usually large in number.
Last year I got an offer from the Vostok-Servis group of companies. They wanted to hold certain reorganizations. They want to work more and better in Azerbaijan. I found this offer interesting. At the first stage there were some difficulties, but we overcame them and carried the reorganization. We opened the show-room on April 3. We managed to unite three in one - the storehouses, the show-room and the office, that is to create a single full-pledged organism. Today, me and my colleagues from our team carry the successful development of Vostok-Servis Baku.
CEO: Do you find time for rest? What do you do in your free time?
Elvin Bayramov: Yes, certainly, I find time. I adore doing two things in my life - sport and having time with my family. I play football twice a week. This is our old tradition with my friends. We play football with friends, in addition, there are good friends among footballers, who play in our futsal, beach soccer teams and some even play for the national team in big football. Every Mondays and Thursdays we gather and play, discuss all developments in our football and so on. And the second direction is, certainly, my family. I have four kids and I love spending time with them.
CEO: Do you love travelling? Which countries have you visited and where would you like to go in the future?
Elvin Bayramov: I would say that I have practically been to all parts of the world. And I want to say that the matter is not that I am 40 now and that you feel nostalgic about homeland when growing older. We all know about Switzerland and the Alps. But the most wonderful thing is when you find this Switzerland not after several hours of flight, but when you drive just 100-200 km, see the nature of Azerbaijan and understand that this is the Switzerland. Life is too swift going and so many things happen, so that you have less time for trips. But here, in Azerbaijan, everything is, certainly, more comfortable.
And you do everything for the family, because you are working for it. But when spending money that you managed to earn, you want to get the service that you expect. That is, if a hotel is four-star, you expect to get at least the four-star service.
CEO: How do you assess the activity of the Caspian European Club?
Elvin Bayramov: I have been friends with the Caspian European Club since 2006. At that moment I was leading the company which is the subcontractor of a British firm. I was introduced to the head of your club at that time. I believe that the team of the Caspian European Club conducts a huge work and I hope that all the companies represented in this club fully understand how difficult and, all the same, how simple it is all presented to the members of this club. The organization of these meetings, the main format of the club is to organize the meetings between business and state. Very many questions are accumulated, which is why this is an excellent opportunity when you can ask question tete-a-tete to an official who is difficult to access otherwise. But the most important is that the Caspian European Club has built a line thanks to which it is possible not simply to ask a question but also to get answers to questions of concern. Many thanks to the club for creating a moment for addressing some painful problems or issues, which require immediate solution.
As we all know, beside general meetings, each company has a supervisor and with the help of the supervisor it is possible to arrange a meeting with any official. As far as I know, in Azerbaijan, there is no such club that arranges such meetings. And the main thing is that great attention is paid to the admission of members. That is, not all companies are allowed to the club, the activity and the degree of company’s transparency are analyzed first. The annual awarding of separate companies, certainly, occupies a definite place. Some polls are held involving the club members, heads of separate divisions to define which company took a worthy place in a separate direction.
CEO: Would you like to add anything?
Elvin Bayramov: In fact, I think that everything always depends on a person. I, personally, have never separated myself from my team, because no one can achieve alone the heights which he can achieve with a team. I am happy to work with our team, I am completely sure that we manage to achieve more through our joint work. This is promoted by some coordinating factors. First all, the country where we live. I am proud of my country, Azerbaijan, I am proud of being Azerbaijani. Second, the head of state who leads the Republic. Sometimes, when you simply speak about your homeland abroad, the foreigners are surprised with the pride with which you speak about your country, your President and the National leader.
Let me show a small example. We have a partner in Ukraine. During the meetings I told him about our National leader, at least everyone in the post-Soviet space knew him. He arrived just recently; we contacted each other and met. After talking a bit, he asked me to take him to Heydar Aliyev’s grave. Certainly, I asked him why he wanted that, to which he replied that he did not understand it earlier, but now, after the events in Ukraine, he realized the scale of this person. He said they need such a person in Ukraine. And we were lucky with all this. In addition, we have wonderful laws. I also mean the laws, supporting business development. Creation of definite technological parks with tax and customs preferences, etc.
Moreover, there is a brilliant young generation who obtain good education both here and abroad with the state support. Today we are proud of Azerbaijan but not only because we are Azerbaijanis, but because we achieved a great success. We see that foreigners come here and admire Baku. Now not only Baku, but also our regions are developing and, though paradoxical, despite some complex situations, the development does not stop. There are big goals ahead. And I think our company and our state will continue rapid development in this atmosphere.
Thank you for the interview