Vitra in Russia

Soukaina NEFAOUI

Msc 2 : INTERNATIONAL BUSINESS MANAGEMENT

2020/2021

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CENTRAL EUROPEAN MARKET

FINAL ASSIGNMENT

SUBJECT 

My work is about the Turkish company VITRA that produces sanitary furniture and floor tiles, and its successful implementation in the country of Russia.

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The reason behind choosing this company is first the fact that I work actually in the real estate promotion sector and making deals with sanitary furniture companies is part of our job.

I chose this company also because after a first research, I found out that its implementation in Russia was quite successful, and that the company went through several steps that I found interesting to detail  before conquering nowadays almost all the Russian market.

PART I

Historical context :

The story of this brand started during the world war 2, when some ceramic products could not be imported to Turkey. In 1942, the company was not more than a workshop in the Istanbul district of Kartal, composed of 8 workers that supplied the country with ceramic products.

The “Ceramics Factory of Doctor Nejat Eczacıbaşı”, as it was then called, was the forerunner of VitrA. After the war, the economic recovery was accompanied by a building boom which again led to an increase in demand for sanitary ceramics and paved the way for the Kartal factory.

In 1958, as materials such as marble lost popularity, the company followed the growing demand and opened the first modern site for the production of sanitary ceramics.

It was in 1966 that the brand name VitrA was found for the products produced there, with reference to the abbreviation of "vitrify" (to make something as hard and smooth as glass), therefore to the ceramic.

In order to increase the diversity of the company, the production of fittings began in 1979 - a strategic step to be able to offer bathroom products alongside sanitary products. Undisputed leader on the Turkish market, the VitrA brand was launched internationally in 1983. VitrA is today considered to be the first Turkish brand to offer the full range of bathroom components.

VitrA supplies millions of pieces of sanitary ceramic worldwide every year. Half of the brand's production is sold abroad, thanks to a strong distribution network.

While a lot has changed since the start of 1942, VitrA can rely on its glorious past to develop contemporary bathroom and tile designs that seem to stand the test of time and yet offer affordable luxury .

Now VitrA is part of Eczacıbaşı, the largest holding company, which consists of 40 companies with total sales of $ 3.2 billion and a staff of over 10,000 people.

Sustainable development : Blue Life philosophy :

VitrA became one of the largest manufacturers of consumer goods with international sales markets. The company is now committed to respecting its commitment to the environment. The conservation of natural resources is traditionally seen by VitrA as the basis of its work.

The set of principles and standards for the protection of the environment Blue Life has been developed by Eczacıbaşı holding, and is followed by all the brands that are part of it. VitrA considers this set of rules as the basis of its activities and is guided by the principles of respect for the environment at all stages of the production process, from mining to the production of products and their subsequent operation.

VitrA invests heavily in the development of resource-efficient technologies in its factories. Particular attention is paid to improving use and treatment. Thanks to a series of strict measures to save water, it is only in the last three years that VitrA has succeeded in reducing water consumption in all its factories by a third. At the same time, energy consumption has decreased by almost 15%. In addition, the VitrA brand actively promotes the ideas of sustainable development and respect for the environment with its partners, helping them to raise their own quality standards.

First implementation in the Russian market :

VitrA has developed through time a strong distribution network. It first started commercializing its products in several countries. Later and thanks to the high demand, the brand started even creating production sites in the countries where the demand was the highest. For some of these countries such as Germany, the holding bought local firms that merged with VitrA to start producing locally.

This was not the case for Russia, where the company first started commercializing tiles and sanitary furniture. Due to the Russian market appetence for VitrA products, the brand decides to do produce locally.

The first VitrA ceramic tile factory in Russia, located in Serpukhov, started production in 2011. The planned production volume is 3 million square meters of mosaics, ceramic tiles and porcelain tiles per year.

In 2014, the company opened another plumbing plant in the Moscow region. The company produced 250,000 units of sanitary products a year, and for this year 2020, the number was supposed to increase to one million.

Today, VitrA has more than 80 selling spot around the country, the brand chose not to manage its own stores, its products are sold in ceramics stores that expose other brands as well. But the presence of the brand concerns the whole country, with a big concentration in Moscow, from which the factory is not far.

VitrA Russia, from a selling territory to a production spot :

VitrA gained popularity in the 5 continents, the brands products are now sold in 75 countries around the world. The production sites are present in 3 countries : 3 factories in Turkey, 2 in Germany and 1 in Russia. Russia is now for the brand not only a country for selling the products, it became also a spot for VitrA products exportation. During the inauguration ceremony of the second production plant in Russia in 2014, the Group Chairman Bülent Eczacıbaşı said “Russia has now become an important production center for us, we are proud to represent Turkey in different locations around the world, with our production facilities as well as our sales”.

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