Maja Cecavac, Managing Director at Beohemija – We will re-establish cooperation with store chains in Serbia and expand foreign markets

(Maja Cecavac) Beohemija left bankruptcy last year thanks to the takeover by the Novi Sad-based company Preston. The company first bought Beohemija and Beohemija-Inhem as separate units in June, and all three companies merged into a single one, called Beohemija, in October 2017. Detergents Duel, Selection by Duel, Spin, Pompa and Scalla thereby got a new owner.

Following this transaction, the company's management announced in late 2017 that Beohemija had realized a growth of sales revenues of 32% since June, as a result of an increase of the production by 47% in the categories of powdered and liquid cleaning products. The positive result and the revival following the said acquisition were an occasion for an interview with Maja Cecavac, Managing Director of Beohemija.

Summing up last year's results, our interviewee points out that sales revenues of EUR 22 million were realized, a jump by 30% compared to the bankruptcy period.

eKapija: How different are the realized results from the goals set for 2017 and what are the goals for 2018?

– We ended the year 2017 within expected parameters. We hadn't set a high goal, as the company had spent the first five months in bankruptcy. Our intention was to maintain the brands and the market share, which we've managed to do. The plan for 2018 is ambitious, but realistic, and envisages revenues of EUR 32 million. We plan to realize this goal based on the expected growth of 12% in the existing markets, by re-establishing cooperation with big wholesale and retail chains in Serbia and by entering the premium segment of powdered and liquid detergents in all markets. The results realized are down to investments made by the new management in the amount of EUR 5.3 million, as well as the fact that we've kept all our employees.

(All the employees have been kept since the acquisition) eKapija: You say that the new management invested over EUR 5 million from the acquisition till the end of 2017. What were the investments made in?

– The money was invested in financing the working assets, primarily raw materials and packaging, necessary for initiating the production and securing the necessary stock of processed materials and finished products. A considerable part of the investments was spent on upgrading and enhancing the existing production equipment, with the aim of raising product quality and efficiency. The funds were also used to procure IT equipment and the missing spare parts, in order to secure a stable production.

eKapija: You've mentioned that you have kept all the workers. How many of them are there in Beohemija and are you planning to expand your team?

– Preston took over the 198 workers employed at Beohemija and Beohemija-Inhem at the moment the purchase was made, and I'm proud to say that there have been no layoffs. When it comes to plans for the future, as the production grows, we plan to increase the number of employees accordingly, and to have them educated even further, focusing on production engineers.

eKapija: Does this mean that new capacities and products are being planned?

– In the first quarter of the current year, we plan to enter the premium segment with our powdered and liquid detergents, but also to expand the current portfolio by introducing new scents. These are big goals indeed, but our current production capacities, which amount to 100,000 tons of powdered detergents and 55 million liters of liquid cleaning products a year, are sufficient for us to fulfill our business plans in 2018, and to accommodate out strategy of future development. Furthermore, we also plan to re-establish cooperation with clients in the segment of trademarks which currently have a considerable market share. We are also negotiating with an important world company.

(Beohemija plant in Zrenjanin) eKapija: When it comes to foreign markets, you are exporting your products to Slovenia, Croatia, Bosnia and Herzegovina, Montenegro, Macedonia, Albania, Armenia and Sweden for the time being. How satisfied are you with your presence in foreign markets and what other countries are being planned?

– The fact that 54% of the said sales revenues of EUR 22 million were realized in foreign markets shows how successful our exports are. The company aims to expand the number of foreign markets, both in the region and globally, and we are very interested in the markets of Russia, Belarus, Kazakhstan, as well as Africa. The market of the European Union is also showing that there is need for our products. Although we are working on increasing the number of exporting markets, we also plan to develop local sales, enter big systems and increase the sales revenues in Serbia. In 2018, we plan for 50% of our sales revenues to be realized in Serbia, and the other 50% from the exports.

eKapija: Numerous large and small, foreign and domestic companies operate in this field in Serbia. How do you see the state of the market?

– The state of the local market has improved considerably, providing a stable economic environment and direction, as well as support from local self-governments, which are the requirements for the growth and the development of any business. Serbia has become far more interesting to foreign investors, but also more attractive for the upgrade of local businesses. I therefore assume that we will have a stable and predictable year 2018, without any considerable price oscillations regarding both the raw materials and the finished products, which is an important piece of information for our consumers.

Katarina Stevanovic

Beohemija doo Zrenjanin

Beohemija

Beohemija Inhem

Preston Novi Sad

Maja Cecavac

Duel

Selection by Duel

Pompa

Scalla

detergents

production of detergents

powdered detergents

liquid detergents

dish detergent

softener

softeners

Beohemija results

Beohemija sales revenues

Beohemija exports

export of detergents