In the current situation, unprecedented in the world, no one has faced anything like this before. We are not just talking about an economic crisis but a complete halt of some industries and a change in the usual way of life. We interviewed eight Russian companies to learn how they are coping with the conditions of the coronavirus crisis.
Shock - that's how we see it.
'Each previous crisis has been a push for our development. In 2008, we were one of the first carpentry companies to open our showroom. In 2014, when everyone shifted towards import substitution, we considered expanding production. But it's challenging to say how to turn this crisis to our advantage,' shares Konstantin Kasminin, the CEO of Attribut. Shock is the first thing everyone experienced: both ordinary people and business owners who had been building their ventures for years.
The company Home Emotions has yet to officially open its planned showroom but is obligated to pay rent for it. Meanwhile, the residents of Orange Park Joinery in St. Petersburg had just inaugurated their flagship salon in Moscow at the beginning of the year, only to be forced to close it three weeks later due to the quarantine measures. "Our company was established in 1995, and over the years, we have faced many challenges. A crisis is an opportunity to test the viability of the firm, the team, and identify what hinders our work.However, the current situation is radically different from all previous ones: we do not have the opportunity to work for the first time," comments Alexey Brook, Commercial Director of Europlast'.
Half of the surveyed companies in AD were unlucky as they are not systemically important, so they cannot continue operating in the usual mode. However, 'Maria' in Saratov, after a week of downtime, received permission and returned to work, restructuring all processes to comply with the requirements of Rospotrebnadzor. There is a distance of one and a half meters between employees, disinfectant dispensers are installed in the workshops, workers disinfect their hands every hour, the workshops themselves are regularly sanitized, as well as each order before shipment..
"Maria" had to review the operation of the dining area and dismantle the doors in some premises to prevent people from touching the handles unnecessarily. "But all our sales points are closed. This includes 108 proprietary and 177 dealer studios under the 'Maria' brand, as well as 220 other trading platforms across Russia," says Liliya Katz, the commercial director of "Maria." The Russian company Giulia Novars had planned to attend the Salone del Mobile this year and present a new kitchen with voice control, so the cancellation of the Milan exhibition added to all their disappointments as they had been preparing for it.
Transition to Online
Like many other companies, furniture manufacturers have also made efforts to transition online and organize remote work, but it is impossible to fully move production to the internet. Accountants, designers, and draftsmen can carry out their work from home, but the operation of machinery requires human oversight, and customers still prefer to choose materials not only visually but also by touch..
I am confident that these changes will affect everyone, and the one who can offer the customer not only a top-notch product but also the best service, including online, will emerge as the winner," believes Marina Melekhova. "We swiftly restructured our interaction algorithms with partners and clients, transitioned to remote work, and provide flooring selection and consultation services around the clock every day. Moreover, while adhering to safety protocols, we deliver samples and necessary documents within Moscow and the Moscow region.
On the official website of "Kitchens Maria," you can request a free design project, choose a model and colors, consult with a designer in real-time through the chat, sign a contract, and make a payment. The website also features a model configurator, information on how to measure your space independently, and a live broadcast showcasing the furniture manufacturing process, organized directly from the workshops. "We've introduced a mobile measurement service: our specialists can visit customers with samples of facades, frames, and countertops, allowing them to see materials in person and select the desired shades. All our employees wear gloves and masks, and we carefully monitor their health while disinfecting all equipment," says Liliya Kats.
Some manufacturers reported a surge in sales at the beginning of March. For example, the company "Maria" saw a 50% increase across all its outlets. This is attributed to the currency exchange rate rise, a decline in oil prices, and the anticipation that all goods will become more expensive. "Market panic began on March 9 when oil prices collapsed. Over the next two weeks, we received a volume of orders that will be enough for three months of production loading," says Alexander Varankin, the director of Giulia Novars, a company that also continues to operate. Home Emotions also noted that some customers paid for orders at the calculation stage. This allowed them to lock in prices, enabling the companies to stay afloat and pay salaries to employees. On the other hand, Breath of Time recently received an unexpected request for the production of metal cabinets and couches for medical institutions.
Manufacturers who are unable to operate at full capacity are managing by using their warehouse stocks. For example, 'Europlast' has taken this approach, as their reserves allow them to ship products in any volume every day, and partially so has Finex. 'We managed to prepare and created a large warehouse program — it's one of our advantages. Production continues to operate, but taking into account all the restrictions from the resolutions of the Governor of the Moscow Region,' says Marina Melikhova, co-owner of Finex.
'We were prepared for the crisis, but did not expect it to be of such magnitude,' adds Igor Loboyko, director of Orange Park Joinery. 'I cannot say that the flow of orders has significantly decreased. I hope our suppliers will also endure. We have a warehouse program, it is quite extensive, but not everlasting.'"
Made in Russia
Will customers choose Russian furniture over foreign ones, and is it realistically possible to fully transition to working with domestic materials? Representatives of companies unanimously agree that if the exchange rate continues to rise, there will be more attention to Russian manufacturers. Unfortunately, our factories will not be able to become completely independent. As Konstantin Kasminin notes, we do not have quality technical hardware in our country, and there is not even an attempt to produce it. Mostly, hardware is ordered from Europe. Alexander Varankin echoes him: "We had to feverishly create reserves of materials, but, unfortunately, for some items, we could not do this in the required volume. The majority of components and materials used by Giulia Novars are produced in EU countries."
Some companies are using the currently available time to implement new technologies or products into production. For example, Attribut has started developing new collections and products. Home Emotions has also taken this opportunity to do the same. "Our designers are less busy at the moment, and they are working on custom orders and projects that we couldn't take on before due to full schedules and lack of time," confirm Ekaterina Rebrova and Elena Povorova, co-founders of the company. "We tell new clients that by signing a contract now, they save time. By the end of the isolation period, they will have had time to finalize all the details, and we can immediately launch the product into production," shares Konstantin Kasminin.
One for all, and all for one.
It was heartening to learn that all companies made an effort to preserve jobs and continue supporting their employees. "As the situation worsened, it became impossible to find masks, so we reconfigured our sewing department and started producing protective masks to supply all our employees," representatives from Breath of Time shared. They also began preparing a ginger, lemon, and honey infusion for all their staff to boost morale and strengthen immunity.
“Our small team has been gathering for many years, so every person is important to us. We value our team, which is why we've decided not to lay off anyone but to reduce salaries by 30%. Everyone has understood and accepted this decision," share Ekaterina and Elena from Home Emotions. "Our country is facing a challenging transitional period, and we are trying to support each other. For example, the company 'Europlast' has organized free webinars for designers, conducted by the architectural and design historian Viktor Dembovsky," says Alexey Brook.
"According to Liliya Katz, the Commercial Director of 'Maria' company, 'It's not us who support and inspire our employees, but rather they inspire us. I see how harmoniously and dedicatedly people work in such challenging times, and I feel proud of our company. We've retained jobs, but the working conditions have changed. Our production team works in a very strict adherence to new sanitary rules. Designers are almost constantly in touch with clients from home, guiding us on how to make the sales system even more effective. The internet marketing team has shown incredible dedication; people didn't sleep for two weeks while launching online services. The crisis that struck has changed our perspective and greatly accelerated us. Thanks to the pandemic, what we've been aiming for in the last ten years was achieved in a matter of weeks.'"
To express gratitude and respect for the work of doctors, which is now more valuable than ever, the company "Maria" has launched a special campaign called "Thank You, Doctor!" and is offering additional discounts on kitchens and cabinets to all healthcare workers. The campaign is ongoing, so all medical professionals will be able to take advantage of it later, when the pandemic subsides, and we all return to normal life.
Source: Architectural Digest