CEO Emex.ru Dmitry Soldatkin
In December 2015, work the sorting warehouse Emex.ru in the suburban Dzerzhinsk fever — employees armed with revolutionary banners and staged a strike, demanding to revise the remuneration system.
“Was the economic downturn, work has become less, decreased income on the part of employees, despite the fact that the company adopted piece-rate pay,” — says in conversation with the magazine RBC General Director Emex.ru Dmitry Soldatkin. Maybe the employees were afraid of losing their jobs due to the commissioning of a new automatic sorting line. On the supply buyers strike is not affected, assured Soldatkin. Then the speech faded away only two weeks, but with some parties suing the company so far. The company is now “all is calm”, the new line has allowed to increase throughput by half, from 40 thousand to 80 thousand orders a day.
Michael kulyabin, in the 1990-ies who owned a hotel in Dubai, decided to expand the business in 1999 and began to bring to Russia from UAE auto parts. The first orders he had received an email redirect providers, and in a response letter received invoices. First parts are sorted in the apartment, then moved to the cellar, and a full warehouse in the heart of the exhibition was published in 2001, says kulyabin in conversation with the RBC magazine. The website of the company appeared a little earlier — up to 2006 it was called Autoemex.ru. In 2006, the assets Emex.ru was decorated in Avtologistika, OOO.
Founder Emex.ru believes that he managed to create the prototype of the Western high — tech companies such as Amazon or eBay. “When this business was created 10-15 years ago, people didn’t even understand what is online trading or Internet-aggregator”, — he said.
Emex.ru from the very beginning operated on the principle of the marketplace — any parts supplier could upload available product with prices. The main category of clients the firm kulyabina steel wholesalers. They developed a system of discounts depending on volume of the purchased goods, which still operates, the minimum discount of 9% from the purchase in the amount of 75 thousand rubles to 31% if the turnover for the month exceeds 10 million rubles.
The lack of in-house retail was motivated by the desire to reduce prices: unlike competitors, Emex.ru do not spend money on advertising, service retail outlets and staff, so the company could afford “not earning much” and to do a low margin, explains kulyabin. The main focus of the entrepreneur did guarantee the quality of goods and speed of delivery. From the beginning the company’s slogan read: “Parts on time”.
Kulyabin one of the first to deliver spare parts to Russia by planes and built not so much “AVTOZAPCHASTI” as a logistics company, providing fast delivery to the regions, said one of the former managers Emex.ru. In 2007, revenues amounted to RUB 2.5 billion by 2011 had grown to 7.6 billion rubles, wrote Forbes. Kulyabin said that business is growing organically, every year adding 30-40% of revenue.
Dmitry Soldatkin headed Emex.ru after a change of ownership of the company. It’s obvious the business: prior to that, he was engaged in retail sales
“Satellites” with Seliger
In 2011 Emex.ru became the General sponsor of the Pro-Kremlin youth forum “Seliger” and stayed there for educational entrepreneurship program. According to its results, the company has selected about 60 young people, 40 of them passed the two-month training in Moscow, during which they were immersed in the theory and practice of business and explained the working principles Emex.ru for example, the categorical refusal to work with counterfeit goods.
To 2011 new client — partners of the company have attracted Emex.ru on the principle of word of mouth. “There was never a policy of how the “new recruits” better start working with the company. Not understanding how to maintain relationships, etc.” — says one of interlocutors of RBC magazine, who worked in Emex.ru.
Clients basically come, nothing special to attract them, did not, confirms kulyabin. But to say that they didn’t work, too, is impossible: the company’s employees traveled to the regions, communicating with partners, participated in exhibitions, he enumerates. However, in the opinion of the founder Emex.ru all of this was ineffective.
Experiment with the “Seliger” has launched a new management team that had hired kulyabin. Join Emex.ru managers come from in the first place for working with partners. The scheme was concocted cooperation, similar to the franchising model: partners had to go on cooperation with a Emex.ru to work under the brand of the company, but remain legally independent.
The program was called “Emex-Satellite”: each of the “satellites” was supposed to be a guaranteed point of entry of the company in a particular city, in return, the partners immediately received the maximum discount on goods at the rate of 31%. The program had economic objectives: it was assumed that new partners are trained, to help scale the business “Avtologistika”, ensuring the growth of turnover from 7.6 billion to 60 billion rubles. for five years, says one of the former managers Emex.ru.
Promising “satellites” managers Emex.ru was just going to find on the “Seliger”. Managed to hold only two “schools” about 80% of “graduates” failed to meet expectations. According to the plan selected entrepreneurs, starting a business with Emex.ru had for six months to reach a monthly revenue of 2.5 million rubles. But the goal reached only a few participants of the experiment.
These entrepreneurs today was supposed to be dollar millionaires, according to the kulyabin. One of these “graduates” told RBC that for five years brought the business from nine wholesale and retail outlets in Moscow on a turnover of 30-40 million rubles. per month. Experiment with the “satellites” were quickly collapsed as kulyabin were reluctant to delegate control over the company, according to a former Manager Emex.ru. The company often changed Directors and managers, and key managerial and technological challenges have been postponed, he says. For example, managers 2012 convinced kulyabina to build a new sorting conveyor: warehouse already sewn up, not coping with the volume of parts, said one of the interlocutors of RBC magazine. The project was implemented only in the summer of 2015 when the new team of managers and shareholders — for a few months before the riot at a facility outside Moscow. Kulyabin is responsible, that was too inattentive to the posts, so “everyone called themselves Directors”, and “the talk” management tried to implement.
$3 million lost Emex.ru on the confrontation with customs in 2007
The 485 partnerswho are engaged in wholesale and retail sales connected to Emex.ru
500 thousand items of spare parts are sold every month in Russia
60 thousand orders done on the day on the website Emex.ru
70 thousand visitors come to the site Emex.ru daily
RUB 7 billion — revenue Emex.ru in 2015
25% forecast revenue growth Emex.ru in 2016
Sources: company data, 4MyCar, “SPARK-Interfax”
The burden of the courts
Despite stable revenue growth, Emex.ru has always lagged behind its main competitor Exist.ru recognizes kulyabin. Financial performance in Exist.ru do not open. In an interview with Forbes, the company’s founder Vladislav Domaracki said that in 2015, revenues amounted to RUB 30 billion.
Founded as Emex.ru in 1990-ies, Exist.ru analysts and representatives of companies from available unanimously called the market leader in online sales of spare parts. According to the calculations of Agency Data Insight and Ruward, by the end of 2015 Exist.ru was the fifth turnover on-line retailer you’ll ever need. In 2007 the gap Emex.ru from Exist.ru was not more than 10% in revenue, says kulyabin. But in that moment, the entrepreneur decided to refuse the services of a customs broker: on the one hand, to improve the speed and quality of customs clearance of goods, with another — to prevent bribes to customs officers, who the mediators are actually “legalized,” he says.
Independent work with the FCS turned into problems: the custom was to bring in relation to “Avtologistika” Affairs about administrative offences for allegedly improperly executed Declaration. The goods remain at the temporary storage warehouses Domodedovo customs for several months, while competitors ‘ products were designed for the day. Kulyabina had to pay for excess storage of goods, and customers — fines for delay, told the businessman Forbes. Assessment kulyabina, only direct damage from the confrontation with customs in 2007 was $3 million.
Illegal, in his opinion, the actions of customs the entrepreneur to put up did not and went to court. Only in 2007-2008 was held hundreds of hearings on claims from “Avtologistika” to the customs officers, many of these cases drag on today.
Moreover, litigation has had to fight not only with customs officials. In 2008, with “Avtologistika” began to sue the copyright holders are the official dealers of Nissan parts, Honda, Daimler and other Dealers were trying to prove that branded car parts, which Emex.ru imports in parallel with them, are counterfeit. In judicial practice, parallel importation is prohibited in Russia since 2002, but the law does not stipulate whether a violation of the import of goods without the consent of the manufacturer, if he sold them in other countries, explains the Ombudsman on intellectual property Anatoly Semenov.
In the case Emex.ru the court practice has been mixed. So, in 2009, the court rejected the claim of the representative of Japan brand Kayaba, considering that he bought in UAE from an authorized distributor of the brand spare parts can not be considered counterfeit, and in 2012 banned Emex.ru to import spare parts under the brand BMW. “Michael is a charismatic, he was genuinely puzzled why a product that he legally purchased the rights holders in Russia is called counterfeiting, and therefore fundamentally pleaded against this,” says Semenov. Other players were less principled in this issue: the same Exist.ru always tried to bring in someone and calmly do business, and kulyabin took “the brunt of the war with the state,” said the Ombudsman.
To step back from the litigation, in 2014 the management Emex.ru refused the import component of the business: the goods imported by independent companies that bear the burden of the courts with the rights holders. Emex.ru associated with them normal trade relations, emphasizes the CEO of the company Dmitry Soldatkin.
A departure from litigation, as well as the construction of a new sorting conveyor, occurred only after kulyabin left them to set up business.
Sorting warehouse in Dzerzhinsk — the main logistic center Emex.ru. With a new sorting line speed of order processing increased to 80 thousand a day
Selling your business exit Emex.ru in 2014, kulyabin call is not ready: on the deal it did not work and “just took their money out of circulation”. The amount the businessman did not disclose, said that she was equal to the “cost of liquidation”. In response to the question about the reasons of going out of business kulyabin said that “to himself all proved”. Now he’s trying to forget about the business that was once created and developed. Revenue “Avtologistika” at the end of 2014, exceeded 10 billion rubles., net profit — 400 million rubles (roughly the same financial performance was in 2013), follows from the information in the database “SPARK-Interfax”. Assets — website, information system and warehouse were transferred to the balance of the new legal entities that are managed by OOO “MX Management”. The firm owns a company registered in Singapore “Ehm IKS Dzhi Pte.LTD.”. Kulyabin said he was not sure that he knows who is behind the Singapore company. Basic business information website Emex.ru — now registered legal entity “Emeks.ru”.
Soldatkin and kulyabin familiar with 2007, Rolf was the official distributor of Mitsubishi spare parts and one of the first dealers began to supply products to Japanese companies to the site Emex.ru. In 2013, Soldatkin together with other managers “Rolf” bought from employer a business selling non-original (not marked with a brand of car manufacturer) parts — the We Love Parts company.
However, Soldatkin almost immediately left the project and by the end of the year held a post of the head Emex.ru. A position he retained after the change of the owner of the online store: according to “SPARK-Interfax”, Soldatkin is the General Director of “MX Management”. Names of the new owners head Emex.ru did not disclose. “Until recently we were confident that we are the only company in the aftermarket that works vbeluyu, reveals financial results and pays taxes,” says Soldatkin, answering the question about the position Emex.ru on the market. And adds that Exist.ru still bigger — “at least, we think so”.
Analytics e-Commerce market share Emex.ru in the segment of online sales of spare parts is difficult to assess, because the company
mainly sell auto parts wholesale, not retail. In 2011, the share of wholesale sales reached 90 per cent, says former Manager Emex.ru. * Soldatkina disparity is not worried: the total number of clients “with one machine” for the last two years has grown more than five times and now stands at about 200 thousand.
Emex.ru among the three largest orders of the online parts stores (in the first place Exist.ru the third Autodoc.ru), cites partner agencies Data Insight Boris Ovchinnikov. The exact number of orders the expert to call is not taken — due to the large share of wholesale purchase of these estimates for Emex.ru differ “significantly”. The online trading market auto parts in Russia to 2015 Data Insight estimated at 35 billion rubles, but Ovchinnikov said that this amount only includes retail purchase. All the spare parts market in the country, according to the Agency “AUTOSTAT”, in 2015 increased compared with 2014 almost 30%, to 1.16 trillion rubles.
Founder Emex.ru Michael kulyabin over 15 years built one of the largest online shops in the Internet on trade in spare parts, but went out of business, because “all proved”. In particular, in Russia it is possible to conduct business legally, but that can lead to long litigations and loss of market position.
With Emex.ru cooperate almost all the major wholesalers and buyers, and as sellers, says Arsen Idrisov, head of project development portals for trading parts Abcp.ru. According to him, Emex.ru ranked fourth among the largest wholesale markets (the rating is based on the number of stores affiliated with the site): from 860 sites that supports abcp.ru the number of partners Emex.ru is around 190 online stores. With Exist.ru for comparison, as buyers there are only two or three shops — the high price of such cooperation can only be afforded by very large companies with a turnover of more than 50 million rubles., says Idrissov. In addition to the largest number of partners Emex.ru boasts and assortment. In Russia, monthly sale of about 500 thousand unique parts are on Emex.ru (the data of the search engine 4mycar.ru). From other online sellers as the full range only at the store Autopiter.ru that is also specializiruetsya in wholesale sales, said Idrisov. Commercial Director Autopiter.ru Boris Zaslavsky refused to communicate with the RBC, but noted that providers with Emex.ru the site has crossed 80%.
Change of ownership Emex.ru oddly enough, while did not affect the change of strategy of the company. Speaking about the priorities of the business, Soldatkin says about the “timing of orders, quality and advantageous prices”. But the point changes to Emex.ru has already begun.
Leading the company, Soldatkin took her in Emex.ru appeared business units, business information, logistics and back office, each has its own head. Units now work more effectively, says CEO Emex.ru. The revenues of the company, bringing together assets upon change of owner, in 2015 increased compared with 2014 by 25% and reached 17 bln roubles (by data “SPARK-Interfax”). Another 1.2 billion rubles in revenue in 2015, the company received Agency Commission when the buyer and seller themselves share on the website information about the order, but in delivery Emex.ru not involved, says Soldatkin.
Great attention to the management Emex.ru pays the information system and website, which since inception has been internal development of the company. It serves about 40 programmers. The company has today more than 1,200 parts suppliers from price lists of suppliers, sometimes consisting of 19 million items, Emex.ru needs efficiently upload data. The received information (as well as data about customers) online store communicates with wholesale partners, often working through their own websites and are synchronized with the database Emex.ru using special web services. Also the system should provide quick search for the ultimate buyers, lists the tasks the CEO of the company. In addition, with the new owners, the company started offering the side individual IT products — for example, software for organization of warehouse logistics.
Under the brand Emex.ru now employs over 480 partners-sellers, they are scattered across the country — from Kaliningrad to Vladivostok, with a presence in the Crimea and Kazakhstan, listed on the official website. For comparison, the main competitor Emex.ru — online parts store Exist.ru — 333 shop-office, to information on the company’s website. Since partners are not legally subject to Emex.ru they can buy and sell spare parts as from the site and on third party sites.
The number of warehouses to sort products from Emex.ru by 2016 increased to four (with Kulyabin was the only one in the suburban Dzerzhinsk): one the company opened in Moscow, one in Saint-Petersburg and Ekaterinburg, however, they belong to a separate logistic company that provides services for Emex.ru. The amount of investment and financial benefits of the expansion of infrastructure Soldatkin not disclose. Items in warehouses, unlike Exist.ru the company maintains a minimal amount. The largest of any warehouse is 100-200 thousand names, while the range on the website today has more than 100 million items, said Soldatkin. To keep the volume of spare parts, is able to predict the demand on warehouses “akin to guesswork”, it is an inefficient investment, said General Director Emex.ru.
By the end of 2016 Soldatkin expects revenue growth of at least 25%. Idrissov evaluates the prospects Emex.ru more optimistic: turnover of the company, he predicts, could grow to 100%. During the crisis the business of small sellers of spare parts becomes unprofitable, and financial flows in the market are redistributed in favor of large players, which thanks to the built logistics and extensive network of partners applies Emex.ru.
In 2007, the funding gap from Exist.ru have Emex.ru was 10%. Now it is about 30-50%, said Idrisov. But perhaps it is an evolutionary strategy of development of business and, finally, the lack of long-term trials will allow Emex.ru at least three years closer to the main competitor.