RISKS & REWARDS OF EXPORTING TO RUSSIA · 2019-04-29 · Food & beverages Pharma Plastics Recycling...

RISKS & REWARDS OF EXPORTING TO RUSSIA

Jeroen Ketting25-04-2019

© Jeroen Ketting All Rights Reserved

INTRODUCTION

▶ Nowadays it’s all about risks instead of potential

▶ But we wouldn’t be talking about risks if there was not potential at all

▶ Today I want to talk to you about the risks and the potential of the Russian market

▶ I stand here before you because I have some experience to share. 25 Years. LHM. LHT. KETTING.COM

▶We went through quite a rollercoaster ride since 2014 but we came out on top

▶We never made a loss, never borrowed money, we actually invested, and achieved 43% growth in 2018

▶We did that by identifying potential, identifying risk and pro-actively dealing with risk and increasing potential

▶We call that “optimizing our risk-reward ratio” and how we did that I will tell you in the coming 20 minutes.

ABOUT LIGHTHOUSE MANAGEMENT

OUR SERVICES:

Market Entry & Business

Establishment

Operational Management

Sales Solutions

Organizational & HR Support

33

LIGHTHOUSE TECHNOLOGIES

Equipment supply

Technical maintenance

Engineering solutions

55

Technical equipment, solutions and maintenance forconveying, feeding and dosing of dry bulk and powders.

7 MAIN IDEAS

5 Differentiate Risk into

“risks” that you don’t

control and “challenges”

that you do control.



IDEA 1: RUSSIA’S RISK-REWARD RATIO

Data Source: International Monetary Fund

▶ The “risk/reward ratio” is the amount of money you invest to make a certain amount of profit.

▶ For every EURO of risk-taking investment there is continuously changing reward in Russia.


IDEA 2: RUSSIA’S SAWBLADE PATTERN

1998 2003 2008/2009 2014/2015


2014 - PRESENT


GDP OF RUSSIA

0

500

1000

1500

2000

2500

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Bln USD GDP of Russia, current prices



GDP GROWTH, 1993-2018


-15

-10

-5

0

5

10

15

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Percent change of GDP, constant prices


COUNTRIES RANK BY GDP (NOMINAL)

0

5000

10000

15000

20000

25000



COUNTRIES RANK BY GDP (PPP)


0

5000

10000

15000

20000

25000

30000


PUBLIC DEBT TO GDP RATIO


0

10

20

30

40

50

60

70

80

90

100

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

General government gross debt, percent of GDP


RANKING OF RUSSIA BY DEBT TO GDP RATIO


• Gross public debt is 13% of GDP • Russia is #180 out of 187 (IMF data)

0

50

100

150

200

250

Public debt to GDP ratio (top countries by GDP)


“Who doesn’t risk, doesn’t drink champagne”

“Кто не рискует, тот не пьет шампанское”


IDEA 3: HIGH-PO VERTICAL INDUSTRY VALUE CHAINS


HIGH-PO VERTICAL INDUSTRY VALUE CHAINS

LIGHTHOUSE TECHNOLOGIES: PRODUCT RANGE

Dosing Conveying Storage Mixing Milling Separation

• Rotary valves• Slide gates• Loading spouts• Screw feeders• Other

components

• Diverter valves• Vortex

diverters• Screw

conveyors• Couplings• Pipe systems

• Silo• Flex-silo• Containers• Big-bag

• Paddle mixers• Ribbon mixers

• Lump breakers • Sieving machines

Dry bulk handling and process engineering


Food & beverages Pharma Plastics Recycling

Mining and metalsConstructionEnergy & biomassChemicals

Among our clients are the leading companies across multiple industries such as: A few examples of materialshandled by our equipment:

• Sugar• Flour• Milk powder• Coffee/tea• Pet food chunks• Plastic granules• Fertilizers• Chemical ingredients• Rubber• Metal powders• Cement• Industrial sand• Coal• Rock

LIGHTHOUSE TECHNOLOGIES: INDUSTRIES



Your Value Proposition

Your Value Proposition

IDEA 4: YOUR HORIZONTAL VALUE PROPOSITION


DON’T COMPETE WITH RUSSIAN STAKEHOLDERS

Your strengths Your customer’s needs

Your competitor’s strengths

ImpossibleIrrelevant

Your value proposition

Competition


YOUR HORIZONTAL VALUE PROPOSITION


IDEA 5: DIFFERENTIATE BETWEEN RISKS AND CHALLENGES

ChallengesRisks


IDEA 6: PREPARE FOR THE RISKS AND CHALLENGES

▶ 1. Focus

▶ 2. Check the Risk & Challenges check-list

▶ 3. Act local, think local (Go to Russia - networking – language - 5W2H)

▶ 4. Understand YOUR industry value chains

▶ 5. Define your horizontal value proposition

▶ 6. Identify your risk-reward profile

▶ 7. Know who you work with

▶ 8. Get your documentation straight

▶ 9. Strategize

▶ 1. Be pro-active

▶ 2. Don’t assume

▶ 3. Limit your exposure

▶ 4. Keep your cool (long-term > short-term)


IDEA 7: STAY IN THE DRIVER’S SEAT

▶With the right focus, preparation and strategy you can still operate a sustainable and profitable business in

Russia.

The Key to Success:

▶ 1. Do we have a competitive product or service?

▶ 2. Do we know the market?

▶ 3. Are we hungry enough for the business?

▶ 4. Are we ready to go local?

▶ 5. Do we have a clear strategy?

▶ 6. Can we dedicate enough resources?

▶ 7. Do we have the right team?

▶ 8. Are we capable and willing to take control?

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Contact Information

Office Address Mytnaya Ulitsa 3, office no. 41119049 Moscow, Russia

Telephone Number +7 495 980 09 79

Email Address [email protected]

Website www.thelighthousemanagement.com

mailto:[email protected]

http://www.thelighthousemanagement.com/

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RISKS & REWARDS OF EXPORTING TO RUSSIA · 2019-04-29 · Food & beverages Pharma Plastics Recycling...

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