Sergey Degtyar, director of government relations at X5 Retail Group. Degtyar Sergey Anatolievich Franchising as a factor of business civilization
100 new stores of the famous retail chain will appear in the Sverdlovsk region
On April 2, in Yekaterinburg, the management of the well-known Russian retail company X5 Retail Group N.V. (retail chains Pyaterochka, Perekrestok, Karusel) signed a cooperation agreement with Governor Yevgeny Kuyvashev. According to the document, another 100 Pyaterochkas will open in the region in the next three years. The focus will be on the products of local suppliers. Therefore, within the framework of the event, the X5 Retail Group delegation visited the Sverdlovskaya poultry farm and met with Sverdlovsk food producers. Read the details in the material "MK-Ural".
To sign an agreement with the governor of the Sverdlovsk region, the executive director of X5 Retail Group N.V. Stéphane Ducharme, General Director of the Pyaterochka retail chain Olga Naumova, Head of the Ural division of the Pyaterochka retail chain Igor Solovyov, Director for Government Relations at X5 Retail Group Sergei Degtyar.
Yekaterinburg and the Sverdlovsk Region are a strategically very important region for us, - said X5 director Stefan Ducharme. - Here, our company first started its work more than ten years ago, and, given the current rhythm of the development of the region, we plan to further actively develop our three retail chains in this region.
Cooperation between the Sverdlovsk government and one of the largest retailers in Russia will be not only economic, but also social. According to the text of the agreement, in the period from 2014 to 2016, 100 new Pyaterochka stores will open in the Sverdlovsk region (including through franchising) and the same number will be converted to the updated chain concept. (In the Urals, a new store format was launched in October 2013.) At the same time, according to Stéphane Ducharme, the emphasis will be placed not only on increasing the availability of the retail network for Sverdlovsk customers, but also on the correct location of stores and expanding the range. In addition, thanks to the opening of new stores, at least 2,000 jobs will appear.
The retailer also plans to develop the Pyaterochka retail network in the region through a reverse franchising program, thereby supporting small and medium-sized businesses. In turn, the government of the Sverdlovsk region undertakes, within its powers, to assist the development of X5 in the region.
In addition, thanks to the signed agreement for regional producers, the scope of selling their own goods will be significantly expanded. There are currently 125 Pyaterochka supermarkets, three Perekrestok supermarkets and three Karusel hypermarkets operating in the region. As Olga Naumova, CEO of the Pyaterochka chain, notes, in the Urals today, the buyer's request has seriously shifted towards fresh products (this applies not only to vegetables and fruits, but also to fish and meat), and "fresh is always your own." Therefore, as part of the new approach to Pyaterochka's assortment policy, special emphasis will be placed on fresh products. Nevertheless, the share of goods of local producers on the "fresh" shelves of the Ural stores of the X5 company still averages about 30%. The retailer aims to increase this figure to 50% or more over the next three years.
We are interested in buying more “fresh” from us, which means we would like to develop all ideas and projects together with local producers so that up to 50 new products in different categories of goods appear on the shelves every week. And of course, we would like to receive assistance from the authorities in our active work to support local entrepreneurs, - added Ms. Naumova.
In this regard, on the same day, the delegation of X5 Retail Group, including the head of the purchasing department of the company Stephen Krieger, visited the Sverdlovskaya poultry farm and met with the leading Sverdlovsk producers of meat, bakery and dairy products.
In fact, we simply broadcast the will of our customers. The loyalty of Sverdlovsk customers to local brands is very high. And therefore, one of our tasks is to ensure the availability and selection of local goods on the shelves of the Ural stores, - said Igor Solovyov, director of the Ural division of the Pyaterochka retail chain. - And the agreement signed with the regional government fixes all changes in relation to fresh products, expansion of the range and volume of deliveries from local producers.
To become a partner of X5, a Sverdlovsk supplier must meet three main requirements: uncompromising product quality; availability (in other words, the ability to deliver daily, regularly and without interruption) and an adequate price for the goods. By the way, as a result of the meeting, the heads of Sverdlovsk enterprises were interested not only in increasing sales volumes in their region, but also in other regions of the retailer.
X5 also signed similar cooperation agreements with the administrations of Moscow, Tyumen, Volgograd, Kursk, Ryazan regions, Stavropol and Krasnodar regions.
In the Sverdlovsk region, 1.5 billion rubles of investments are planned for the entire project for the development of a retail network. And the jubilee, 500th Pyaterochka in the Urals, the Moscow guests promised to open it in Yekaterinburg and already this year.
Federal chains that go to the regions are often reproached for the fact that they are reluctant to put products from local manufacturers on their shelves. Do you agree with this statement?
10,000 manufacturers work with X5, more than half of them are local and regional. So it's not true that we don't let them in. But if we put on the shelves everything that they are trying to bring us and sell from us, buyers would hate us. Firstly, not all suppliers are ready to offer the best selling price, not all can provide high quality products, not all are stable in supplies. Secondly, the shelves in stores will not be able to accommodate everyone. And competition for a shelf, that is, for a buyer, among suppliers is a normal market practice. For example, we have more than 4 thousand stores across the country, in which about 2 billion purchases are made per year.
- Which suppliers end up on the shelves of your stores?
Those who effectively organized production, pricing, quality control, marketing. Such suppliers prefer not to complain, but try to meet the requirements of modern retail. As a result, working with us, they get significant competitive advantages. With a large federal network, such a supplier moves into the "major league" in its segment. Perhaps he has more costs and investments, but he will have the best quality and competitive cost of goods, high productivity, large guaranteed sales volumes, a wide sales market both in his own and in other regions of the country where the network operates. The matrix of local production is constantly changing. If some suppliers are already working with us, this does not mean that other manufacturers will never get into our network.
- That is, all reproaches from suppliers are far-fetched?
We are not perfect, but we try to work on it. First, the Code of Good Practices, which was signed at the end of 2012 by the Association of Retail Companies and leading industry unions of suppliers through Igor Shuvalov, Deputy Prime Minister of the Russian Federation, is a great help for dialogue with suppliers and retailers. Within the framework of the code, both suppliers and retailers get the opportunity to self-regulate relationships through an open dialogue, joint development of the principles of a contractual company, product quality control, pricing, document flow, and sanctions against violators of agreements. This is a very useful document for both suppliers and retailers. We have included the main provisions of the code in supply contracts. We have created a conciliation commission, which will deal with each case of dishonest work of our purchasing managers or category managers. In addition, in each agreement with the region, we prescribe in a separate clause the need to work with local manufacturers and suppliers, to exclude any discriminatory forms. At the same time, of course, we count on reciprocity from the authorities. The more stores we have in the region, the more local products we will sell. Where there is more competition, there are lower prices. In any case, the choice remains with the buyer. He is the main regulator of the market.
Interviewed by Alena Tronina
Tyumen magazine publishes an interview with Deputy Governor of the Tyumen Region Sergey Degtyar. The conversation was timed to coincide with the All-Russian Forum "Franchising: New Potential in the Development of Regions", which was held in Tyumen on May 23. Sergey Anatolyevich talks about the institute of franchising in the Tyumen region: the course of development, advantages, benefits, features and prospects.
According to our interlocutor, Deputy Governor of the Tyumen Region Sergey Degtyar, the consumer market is by far the most developing sector of the Russian economy, and the Tyumen Region is no exception.
Sergey Degtyar, Deputy Governor of the Tyumen Region
- 1994–2001 – Deputy of the City Duma of Nefteyugansk, Chairman
- budget commission.
- 2001-2005 - Deputy of the Duma of Khanty-Mansi Autonomous Okrug - Yugra, Deputy
- chairman of the budget committee.
- 2008–2009 – Chief Federal Inspector, Deputy Plenipotentiary Representative of the President of the Russian Federation in the Urals Federal District.
- From 2005 to the present - Deputy Governor of the Tyumen Region.
In 2011, the share of trade in the structure of the gross regional product of the Tyumen region amounted to 16% and thus ranked second after manufacturing; the share of employed in the total number in the region's economy is almost 13%. Tellingly, retail space has doubled over the past five years. Now the task is to move from quantitative to qualitative indicators, and this requires serious structural changes and the use of modern economic mechanisms.
“We buy Tyumen”, looking closely at eminent brands
Tyumen: Sergey Anatolyevich, we are talking to you in the spacious building of the West Siberian Oil and Gas Innovation Center, our technopark, in the creation and operation of which you also took an active part. In the spring of this year, a franchising forum was held here, which became a notable event, but left a number of questions. In particular, we talk a lot about the need to protect regional producers and small businesses. And at the same time, the business itself relies on franchising. These things do not contradict each other?
Sergey Degtyar: No, they do not contradict, moreover, they complement each other. In no case do we share our efforts to implement the Buy Tyumenskoe project with franchising. It is simply clear that it is impossible to live outside some common economic, market space in which we are already partly integrated. And with the entry into the WTO, we will also be integrated into the world economy. It is obvious. And today, stewing in one's own juice and being content with home-grown, in a good sense, developments is not only wrong, but unfair to the economy of the Tyumen region. On the one hand, we bring to it new knowledge, business technologies that bring franchises from outside, primarily global brands, and on the other hand, at the last franchising forum, agreements were mainly signed for the sale of our regional franchises. Companies such as Mebelville, Etazhi, Quanta Plus, Maxim, Arsenal+, which were born in our region, have grown to the point where you can replicate your experience and methods of work. Moreover, we see a certain synergy in terms of franchising, its full adaptation to the Buy Tyumenskoe project.
TMN: Tyumen plywood is supplied to many countries of the world, 75% of Tyumen furniture is exported. Can Tyumen still produce some new brands that will be in demand, if not abroad, then in other regions? And how does the regional government intend to stimulate this process? After all, it is easier to buy a franchise than to create something of your own, investing your own money, promoting a brand, promoting a product.
S.D.: The Tyumen region is implementing a regional program for the development of trade, the main goal of which is to meet the needs for quality goods and services of the population with different income levels.
For example, the stimulation of consumer demand among the population with low incomes is carried out by and through the creation of agricultural markets through budgetary financing of the costs of supply communications, in accordance with the current resolution of the regional government.
For middle- and high-income consumers, the regional program provides for the development of the franchising institution.
The regional government decided to support small businesses in the trade sector, which can receive a grant on an irrevocable basis in order to create their own business, including paying a lump-sum fee under a commercial concession agreement in the amount of up to 300 thousand rubles. And this mechanism works. For example, the Spasskaya Hotel has already received a grant by implementing its project. In 2011, through the Microfinance Fund of the Tyumen Region, microloans were allocated for the purchase of franchises in the amount of 3 million 200 thousand rubles, and this is just the beginning.
A worthy example of a successful public-private partnership in the development of regional franchising is the regional program "Expanding Horizons", the purpose of which is to increase the computer literacy of the region's residents. The regional company "Arsenal+", a partner of the program, is successfully replicating the franchise, as evidenced by the opening of 18 sales centers in municipalities, where a line of social computers is presented. Of course, such an interaction between the interests of government and business allows you to get a multiplicative effect.
TMN: How can the development of franchising change the competition in the domestic consumer market? They say that opening one branded supermarket kills 2-3 convenience stores.
S.D.: We do not impose any particular format on the consumer, but create equal conditions for both convenience stores and retail chains. If large-format enterprises lose in something, they win in price due to large wholesale deliveries. But there is still a niche for convenience stores: they are more focused on maintaining their market conditions, they have a smaller turnover, but they have their own regular customers. I think that in the field of trade, everyone will find their place. As for the competition. Today, there is an urgent need in the region to create new modern roadside service facilities with a qualitatively different level of service and a wider range of services provided. Unfortunately, there is almost no competitive environment here today.
Therefore, assistance in the development of roadside services has become one of the priorities of the regional government. The use of franchising technologies in this area will not only allow you to quickly and efficiently raise the level of development of roadside infrastructure, but will also contribute to the improvement of related industries and the area as a whole. Work on the selection of franchises in relation to roadside services is being actively carried out jointly with the Russian Franchise Association.
Franchising as a factor of business civilization
TMN: Practice shows that in small businesses, employment contracts are either not concluded or are concluded for the minimum wage. The rest is paid according to the shadow payroll. Do you think working under a well-known brand will force the entrepreneur to comply with the law?
S.D.: I think that the relationship of franchise employers with employees is changing dramatically, as any negative information about the brand, no matter where it is presented, seriously damages the company's reputation. Which of the eminent owners would like to read on the website of the prosecutor's office, for example, that the leaders of an enterprise operating under this name were fined for issuing salaries in envelopes or delaying them? This is a serious blow to the brand. Such a reverent attitude towards it presupposes a civilized form not only of trade, but also of labor relations. A franchise or commercial concession agreement is a voluminous document in which everything is described in detail, from the size of the letters on the sign to the relationship with customers.
TMN: Does the brand owner monitor compliance with this agreement?
S.D.: You know, such control becomes even more effective than you can imagine. The price of a franchise that a local entrepreneur buys is quite high - it reaches one and a half, or even three million rubles. And no one wants to pay that kind of money for a franchise for a year and lose the right to use the brand after three months. The rules are very strict. They just come, remove the sign, deprive the company of the name - and continue to work as you wish.
Promoting the development of roadside services has become one of the priorities of the regional government
TMN: If we talk about Tyumen as a site for the development of franchising, what advantages would you note - logistics, infrastructure, market, administrative?
S.D.: There are no limits to perfection, but the fact that we have, if not all, then many well-known brands, speaks for itself. Of course, we will increase the presence of these names, civilized, progressive business technologies, and for this, the urban environment is primarily important. To make everyone comfortable. It is very good that all well-known brands today are already reconsidering their stereotype - to enter only million-plus cities. They moved away from this, and Tyumen was one of the first to make them adjust their marketing preferences. Successful development of regional franchising is impossible without interaction with local governments. Currently, we are actively working to involve municipalities in the development of the franchising institution. In cities and district centers, field seminars are held, at which we explain to entrepreneurs the benefits of introducing franchising, advise on state support, and conduct presentations of franchises.
In addition, the arrival of foreign and federal franchises in the region contributes to increased competition and, as a result, the development of regional ones, which, in turn, having worked out this technology in small towns and rural settlements in their region, will be able to replicate it in other regions of the Russian Federation, and then perhaps beyond.
Call to action
TMN: What exactly does franchising give to the economy of the Tyumen region?
S.D.: The use of franchising contributes to our main goal - the formation of a civilized regional consumer market.
This business technology creates incentives for the parties interacting in this market, including for consumers - in the acquisition of more and more high-quality goods and services; for development and investment companies – in the development of a decent infrastructure, including the construction of business centers and modern-style retail facilities; for enterprises of the consumer market - in improving the quality of goods and services sold.
Since 2010, activities to promote the development of franchising in the Tyumen region have been carried out in close cooperation and cooperation with the Russian Franchising Association.
One of the latest joint events is the All-Russian Forum-Exhibition “Franchising: New Potential in the Development of Regions”, which took place in May this year. The forum brought together in Tyumen more than 300 participants from 11 regions of Russia, which became a kind of signal for a more effective development of franchising in the region.
This year, the Committee of the Federation Council on Federal Structure, Regional Policy, Local Self-Government and Affairs of the North, the Department for the Development of Small and Medium Enterprises of the Ministry of Economic Development of Russia, and Sberbank of Russia acted as a partner of this event.
At the forum, which was directly supervised by the governor of the region Vladimir Yakushev, nine agreements were signed on the conclusion of commercial concession agreements in the consumer market, of which local entrepreneurs with their own brands acted as franchisors in seven of them.
The use of franchising contributes to our main goal - the formation of a civilized regional consumer market
The round table held within the framework of the May forum on the topic “Franchising as a tool for the development of municipal districts” allowed the participants to consider the promotion of franchising in small settlements of the region, the advantages of developing this technology in relation to these areas; study the experience of local franchisors in small towns and rural areas; present banking products for small businesses; to build a scheme of relations between government and business.
I would like to note that consideration of the issues and practices of other subjects of the Russian Federation on the development of franchising at the regional level is lively and relevant, therefore, we see it as expedient - and this idea was supported by the Governor of the Tyumen Region - to use the city as an annual platform for the exchange of experience and discussion of the prospects for the development of regional franchising. Tyumen.
Text: Alexey Nosikov
https://www.site/2013-11-14/s_pomochyu_nekogda_zama_yakusheva_byvshie_vladelcy_tnk_vr_budut_kontrolirovat_rynok_s_oborotom_v_sot
Sobyanin's friends return to Tyumen
With the help of former deputy Yakushev, the former owners of TNK-BP will control a market with a turnover of hundreds of billions of rubles
Counters of Tyumen markets can bring fabulous profits
Today, November 14, Governor of the Tyumen Region Vladimir Yakushev signed a cooperation agreement with one of the largest Russian retail chains - X5 Retail Group (owner of the Pyaterochka, Perekrestok, Karusel brands). As it became known to the site, the new director for interaction with the regional authorities of the company, an old friend and former deputy of Yakushev, Sergey Degtyar, took part in organizing negotiations between Yakushev and X5 management.
Recall that Mr. Degtyar resigned from the government of the Tyumen region on December 22, 2012, and already on January 9, 2013, he moved to work at TNK-BP as the company's vice president for regional policy. The patronage of the official was then the head of the oil giant German Khan, who personally asked Yakushev to transfer a valuable employee to him. Then it was already known about the takeover of TNK-BP by Rosneft, and some experts suggested that Sergei Degtyar could take a place in the empire of Igor Sechin. However, he did not suit the businessman, and soon the former official quit. He surfaced already in the fall as director of GR at X5.
Note that Sergei Degtyar, according to our sources, is "Sobyanin's man", and one of the closest. Therefore, a large retailer gladly hired him.
After leaving the civil service, Sergei Degtyar (right) changed his image and grew an impressive beard
“This is a real colleague of Sergei Semenovich, whom he fully trusts,” says one of the interlocutors of the site. “For example: when moving out of Khanty-Mansiysk, first to Yekaterinburg, and then to Tyumen, Sobyanin left his apartment in the capital of Yugra for safekeeping to Degtyar, and he did not just come to water the flowers, but lived in it.”
Another connection between Degtyar, Sobyanin and Yakushev is the shareholders of X5 Retail Group. The largest stake in this group (48%) belongs to the co-owners of Alfa - Mikhail Fridman, German Khan and Alexei Kuzmichev. The close cooperation of the first two with Sobyanin is well known. Therefore, it is not surprising that after the completion of the deal on the takeover of TNK by Rosneft, Sergei Degtyar remained with German Khan - albeit not in the oil, but in the food business. By the way, this is a rather “fat” and well-growing part of retail: according to Tyumenstat, the turnover of food trade, including drinks and cigarettes, amounted to almost 253 billion rubles in January-September 2013 alone (for the entire 2012 - 224 billion rubles) .
Now, according to the official websites of the stores that are part of X5 Retail, there are three stores under the Pyaterochka brand, three Perekrestok and one Karusel hypermarket in Tyumen. After the signing of the contract, experts expect X5 to expand its influence and, accordingly, increase the group's profit share in the regional market.
The agreement with X5 is signed for 2013-2016. For the region, it means 5 billion rubles of investment, and for the retailer - the opening of more than 100 retail stores and the construction of a logistics center on the Trans-Siberian Railway. It will connect the transport corridors West-East, North-South, and will become the most important hub for trade with Asian countries through Kazakhstan.
. - One can argue how effective the work of Sergei Degtyar himself was in this sense - perhaps the decision was made in Moscow in a private conversation between Khan and Sobyanin. However, Degtyar still works quite actively, for example, in September he personally signed a similar agreement with the deputy chairman of the government of the Ryazan region.
By the way, Tyumen experts note the surprising similarity of Degtyar's fate with the life path of another well-known Tyumen resident who went over to business, Sergey Smetanyuk. Both were deputy governors of the Tyumen region, both held the posts of chief federal inspector in the region and deputy plenipotentiary representative in the Ural Federal District. And even now their positions differ by only one letter. Smetanyuk, we recall, is engaged in PR in the structures of Sibnefteprovod.
Moscow, November 25, 2013- X5 Retail Group N.V., one of the leading Russian grocery retail companies, announces the creation of a Conciliation Commission, which will become a corporate arbitrator in disputes with suppliers. The Commission was established on the basis of the principles of the Code of Good Practices (CDP). Her tasks include improving the efficiency of X5's contract work, creating a platform for direct dialogue with contractors, and resolving disputes.
The main functions of the commission are to consider complaints regarding the process of selecting counterparties or their disqualification, identifying problems in contractual work, preparing recommendations and proposals on identified problems for submission to the Company's management. In addition, the Commission will consider proposals from contractors to improve the Company's procurement policy. The text of the Regulations on the establishment of the Conciliation Commission and the form of the Application for consideration of a complaint are posted on the Company's website in the "Partners" section on the "Suppliers" page http://www.x5.ru/ru/partners/goods/ .
The commission was headed by Sergey Bakumov, executive director for corporate services. The Commission included X5 executives: Sergey Degtyar, Director for Government Relations, Dmitry Agureev, Security Director, Tatyana Ryabova, Director of Human Resources Management, Vladlena Yavorskaya, Director of Legal Support for Business, and Irina Korochentseva, Director of Internal Audit.
Meetings of the Conciliation Commission are planned to be held monthly.
Director for Government Relations X5 Retail GroupSergey Degtyar:“X5 is interested in establishing transparent and open relationships with partners. That is why we once acted among the initiators of the creation of the Code of Good Practices, and then consistently not only supported this document, but also began to actively apply its provisions in practice. In particular, this year alone, X5 held more than 30 purchasing sessions with regional suppliers, joint briefings and working meetings with industry Unions and Manufacturers Associations, as well as the first open conference for suppliers in Moscow, bringing together about 400 partner companies for dialogue. The creation of the Conciliation Commission, supported by our suppliers, is another real step towards increasing the efficiency of joint work for the benefit of the industry and our customers.”
For reference:
X5 Retail Group N.V. (LSE: FIVE, Moody's - "B2", S & P - "B +"), one of the leading Russian grocery retail companies. The company operates stores of several retail chains: soft discounters under the Pyaterochka brand, supermarkets under the Perekrestok brand ", hypermarkets under the Karusel brand, a retail Internet channel under the E5.ru brand, as well as convenience stores under various brands. As of September 30, 2013, the Company managed 4,187 stores with a leading position in Moscow, Petersburg and a significant presence in European Russia.The Company's store network includes 3,568 Pyaterochka soft discounters, 382 Perekrestok supermarkets, 78 Karusel hypermarkets, and 159 convenience stores.The Company also operates 29 distribution centers and 1 820 trucks in the Russian Federation In 2012, the Company's net sales amounted to USD 15,795 million, EBITDA amounted to USD 1,124 million and net loss the current amounted to 126 million US dollars. For 1H 2013, net revenue was $8,382 million, EBITDA was $576 million and net income was $139 million. The shareholders of X5 are: Alfa Group - 47.86%, the founders of Pyaterochka - 16.35%, directors of X5 - 0.02%, treasury shares - 0.06%; 35.71% of the shares are in free float.
