With partners from China, first — 10 liters of tea, then — a contract

Today, in our section "Omsk conquers the world", there is an interview with Viktor Vakhrameev, director of Sibbalt.

The products of this company, salty snacks, are known and loved in Russia, neighboring countries, Germany, and China. Today, the company has more than 3,000 permanent partners. And this is not surprising, because its products have repeatedly received medals from the Prodexpo international exhibition and the Gemma competition for quality and brand names.

We decided to start the conversation with the history of the Sibbalt company.

— Victor, tell us how your company came to be — where did you start?

— Sibbalt company appeared at the end of the last millennium, back in 1998. First of all, we installed a peanut production line, and then we decided to expand the range — we started producing DRIVE pellet chips. After the appearance of "kirieshek", "bread makers" were added to the range. And when they realized that all this needed to be effectively sold, they created a sales department. From that moment on, the development of a serious business began. We have gone through the stages of wholesale sales, retail, and network dominance. Now we are actively developing sales in the regions and trying our hand at exporting.

— How long have you been running the company?

— For more than 12 years. In 2004, he started as a sales representative, then became a supervisor, head of sales, and commercial director. And now the director.

— And what is your most important product?

— We are rightfully proud of our crunchy peanuts of the PIVAHIS trademark. There is also a peanut TM SIBBALT with the same name, which is very popular in Omsk — probably every adult resident of our city knows it.

This is a really cool brand: unique production technology, vacuum packaging, special type, taste, size, organoleptics of the product. Our new product, a mixture of peanuts and breadcrumbs, is also very interesting to consumers. It's the same thing that distinguishes all our products — convenient packaging, a delicious mix under the trademark "NOW TOGETHER" — these are two products for the price of one (there are almost no analogues). And, as I said, the breadcrumbs and croutons of the KHLEBARIKI brand are made from special freshly baked bread, with a new restyled design.

— But you don't sell peanuts to China, but your famous DRIVE chips?

— Of course, they wouldn't let us re-export peanuts. The Chinese partners are interested in chips. We started producing them more than 10 years ago, based on the Pinocchio chips that many have loved since childhood. They were very popular in our country, in particular, in Omsk, back in Soviet times. Our eight flavors of DRIVE CHIPS are made from potato flakes and starch. They are very similar in composition to imported Pringles, but three times cheaper. And it is much more convenient than many analogues in terms of logistics.

— Why are they so convenient?

— DRIVE chips are made by forming into plates and packed into rectangular boxes. During transportation, these boxes take up much less space than tubes or pillow—type bags - and this is a real saving on delivery. Today we are the only producer of plate chips outside the Urals.

— And how did you enter the Chinese market with chips?

— Since 2011, we have been cooperating with the Omsk Region Export Support Center — we participate in international exhibitions, undergo training and seminars. And in 2016, thanks to the Center, we went to the Beijing Food Exhibition for the first time, from which serious export activities began. Already in 2017, the first shipments of DRIVE chips to China were made. Although potatoes are grown there, potato chips of this shape are not made. So our chips are very interesting and profitable for our Chinese partners. Despite the fact that in Omsk they cost about 50 rubles per pack, in China (in terms of rubles) — from 100 to 150 rubles.

— Are your Chinese partners only interested in chips?

— Not only that. Many people really like the taste of our croutons. Having tried, they say: "These are the ones we really want!" But there is a nuance here that is still hindering the agreement. The fact is that they need a product with a shelf life of 12 months — we have six months so far. I don't know if it needs to be increased — after all, our consumers prefer products that are more natural and, consequently, with a shorter shelf life.

— Are deliveries to China going "smoothly" or are there extreme situations?

— Although we try to work without extremes, unusual deliveries still happen. One of these is in Xi'an, China. This is one of the largest land ports, which is closer to Omsk in terms of distance than, for example, Shanghai. So we tried to get a container of chips there. There are no direct trains, the cargo had to be shipped via Novosibirsk. It turned out to be a difficult combined delivery when we had to load half of a 40-foot container with flour in order to reduce transportation costs. There was an agreement with the Chinese partner that he would sell this flour so that the supply would be profitable. That's how it turned out: I sold it, the delivery is profitable. But we still did not continue deliveries to Xi'an — there are too many problems. We work with cities where simple logistics schemes operate — Shanghai, Harbin and others.

— Are there any specifics of cooperation with China?

- of course. For example, Chinese partners greatly value friendly relations. They are the ones who come to the fore, and then the business. Therefore, in order to reach an agreement, several meetings are held — at least five. Each lasts for several hours.: we communicate — as a rule, we drink tea, and only then we move on to supply arrangements. Before signing one contract, you can drink 10 liters of tea, but such communication "for life" is very important for partners from China. When partners from China come to Omsk, they enjoy walking along Lenin and Valikhanov streets, along the Irtysh embankment, and visiting museums.

— Were there any difficulties because of the pandemic?

— Problems with export contracts arose in early 2019. Since export shipments are high-risk, we only work on prepayment. And at the beginning of the year, three Chinese partners simply failed to make payments — Chinese banks refused to make payments to Russia without explanation. Maybe they already knew about the coronavirus then? We were able to resume our export activities with China only in the middle of 2020, and now we hope for the best. — And in Russia? — The situation in Russia was ambivalent. In the local market, in the Omsk region, the demand for snacks and sales increased, but the regions were slowed down — some of our partners were quarantined.

— Can you tell us the figures of shipments of your goods for export?

— There is no secret here — more than 50 tons are exported to China, Germany, Kazakhstan, Azerbaijan, and Ukraine. At the same time, our trademark is protected abroad: we have an international registration under the Madrid Protocol in several countries of the world and China.

— What are the company's future business development plans?

— Realizing the huge potential of the Chinese market, we plan to diversify our sales, reduce dependence on the devaluation of the ruble and reach a new level of business development. Now we are entering Chinese marketplaces (online trading platforms) through large distributors. This is working with the Chinese market directly — it is very difficult to enter there! Here, the Omsk Region Export Support Center helped us again with consultations and financing of promotion at these sites. This is actually very valuable, since small and medium-sized businesses often do not have such resources. We hope that the marketplaces will allow us to increase exports to China several times.

— Will Omsk residents get your delicious snacks after that?

— Of course! Moreover, next year residents of Omsk will be the first to try new products from the Sibbalt company — completely natural chips. This is our unique development, caused by a pronounced trend towards healthy eating. Instead of chemical flavorings, aromas and flavors are created by healthy seasonings: sesame, onion, garlic, pepper, salt.

— Thank you, good luck to you!

Small and medium-sized businesses can also use the services of the Export Support Center free of charge: translation of materials into foreign languages, organization of participation in international exhibitions, business missions, search for partners abroad, placement on international trading platforms and much more. Learn more on www.ved55.ru in the "Services" section.

Reference: The Omsk Region Export Support Center carries out activities within the framework of the implementation of national projects in the region "Small and medium-sized entrepreneurship and support for individual entrepreneurial initiative", as well as "International cooperation and Export".