Interviews with Russian hookah exporters — How have the events of recent months affected their business?

The Russian market is currently going through hard times. Many country borders are closed to cargo, and some are difficult to get even for a tourist.

Difficulties fell on the heads of hookah exporters. In recent years, many Russian hookah brands have focused on the international market and sold a large number of products for export.

The Hookah Battle team decided to find out how our manufacturers are doing and ask them a few questions.

Stanislav Oleynikov – Founder of Japona Hookah

You have been on the market for a long time and deliver products to many countries. Which countries are you working with now?

Hello. The main countries that regularly purchase our products are: USA, Germany, France, Spain, Turkey, Israel, UAE, Qatar, Hong Kong, Japan, CIS countries. And the overall geography of sales is much larger. One of the most unusual was sending a 40-foot container to the Dominican Republic.

 

What percentage of products go to the export market? How important is export to you?

Our share of exports was 85% , and now, unfortunately, it is very difficult for us to work in the new world realities.

 

— How much has the events of recent months affected your supplies? Did you manage to adapt to modern realities?

  We have practically reduced our work with European countries to a minimum. The focus is more on Eastern and Asian countries. We have resolved the issue of payment and logistics for transit through Istanbul.

 

— Do you think that in the near future you will find markets for selling products to replace those that you lost? And will the situation with the existing countries change?

  In such volumes of purchases for export, we will not be able to recover until the end of the year. We have started working more actively on the domestic market and hope to increase our turnover with the United Arab Emirates, Dubai and Hong Kong.

 

-What advice can you give to manufacturers who want to work for export?

 No one will be able to work for export now in the same volumes as they were in 2021. There is only one tip: sign a contract with DHL express, try to make a PayPal business account in another country (we were able to do this), make an English version of the site and work only in retail. Wholesale deliveries through other countries with non-competitive prices on store shelves due to the increased cost of delivery will make our products less popular. But since our products have international recognition and popularity over the past 5 years. It will be easier for us than for new brands without recognition and advertising from European partners.

 

— If the company’s turnover decreases, will you be able to invest in the development of new products as before?

Unfortunately, this is a big question. If we can return domestic sales to the same level as we had for export. We can continue to delight our brand’s fans. We have a lot of work to do on the site, marketplaces, and opinion leaders in Russia. If we can introduce our products to even more customers in 2022, then we will be able to develop and create something new and unique! We believe in the best

 

 Igor Chuvakov-Co-Owner of Maklaud

– Good afternoon, Igor! What countries are you currently working with? And how long have you been exporting?

Hey. We started developing the export direction in 2018 (two years after the opening of the company). If we talk about retail and wholesale sales together, we work with a fairly extensive list of countries, for example: CIS countries, Europe, USA, United Arab Emirates, China, Turkey, Israel. I can say the most impressive sending for me. The country is called Reunion. A small island near Madagascar.

 

— What percentage of products go to the export market? How important is export to you?

Until February 2022, 60-80% of products were exported.

Unfortunately, in Russia, not many people can afford our product, both for financial reasons and the idea of creation. Hence, the export direction is quite important for us.

— How much has the events of recent months affected your supplies? Did you manage to adapt to modern realities?

The impact was quite strong in the following areas:

Rise in price and shortage of some products for production.

Logistics.

Accepting orders and receiving payments.

There is no critical situation in any direction. There is a solution in every direction. More time and money is spent on solving the problem.

— Do you think that in the near future you will find markets for selling products to replace those that you lost? And will the situation with the existing countries change?

Definitely yes, we will be able to replace the lost countries, we know how to do it. And we are actively engaged in this. We have (already) a fairly ambitious plan of action for this situation.

I think the situation will change quite often, and it is difficult to say who we will be able to work with. More details about the current countries can be discussed, at least in early 2023.

The situation can change so quickly that it is possible that by the time the interview is published, our conditions may change. I am typing this text on 22.02.2022.

— What advice can you give to brands who want to work for export?

First, think about whether Your product and You will be able to make a “splash” in the new market?

A good example! Bowls, how many of them! hundreds of brands already around the world? See that they all look alike. You can distinguish the distinctive ones on the fingers of two hands. Why is there another manufacturer of ordinary bowls in the world?

Kalaud is another matter. Changed how we work with the hookah. I perfectly remember the moment when kalaud appeared, as many people said, Nonsense, let’s stay at the old school (foil). What about now? I’m afraid to lie, but it seems at least a year, I haven’t seen a hookah on foil.

If, you answered Yes to my questions. Read on.

I give you free and very important advice. Don’t leave your export work to third-party companies. Develop the direction on YOUR own. If you do not know where to start, write to me on social networks, we will be happy to give you advice.

And also. Do not be afraid to develop the export direction, we have gained experience and spent a lot of money for several years. Be more active: find out, ask, try, call, write, read, join together. Do not wait for the moment, you need to take it and do it. The best moment is now.

 

 

Ilya Ulanov – Founder of HOOB

 

– Good afternoon, Ilya! What countries are you currently working with? What are the main problems you are currently facing?

Good afternoon! At the moment, the number of countries we work with has sharply decreased. The main problems are payment, logistics, and the general fear of working with companies from Russia. We continue to work actively with the CIS countries. Europe, the United States, Japan, as everyone now says, have temporarily suspended cooperation. Export requests come in one way or another, but the problems described above slow down the transaction very much. After 1-2 weeks of searching for solutions for payment and delivery, the client burns out and is not ready to bear high risks.

 

— Please tell us what percentage of products go to the export market? How important is export to you?

Before the February events, our export share was 20-30%. We tried to reorganize our business processes as quickly as possible, paying maximum attention to the domestic market. We try to keep in touch with our foreign partners so that if the situation improves, we can quickly restore export supplies. We are also considering a negative scenario of a long-term foreign economic crisis, but, like everyone else, we hope that it will end as soon as possible.

 

— How much has the events of recent months affected your supplies? Did you manage to adapt to modern realities?

We make about 50% of parts in our own production, 20% contracts in Russia, 30% we order in China. In Russia, for more than a year, the price of materials has been growing very strongly. The growth was more than 2 times. Accordingly, we raised prices, even despite the alleged peg to the dollar, and so on. Now the dollar has returned to the region before the crisis levels, but the price of materials, especially imported ones, does not fall. There is also a tense situation in China now, prices have increased by 5-10% + logistics has increased. But the question in general is only about the rise in prices. We do not experience any interruption of supplies, shortages of anything. 

— Do you think that in the near future you will find markets for selling products to replace those that you lost? And will the situation with the existing countries change?

The capacity of the Russian market is very high, compared, for example, even with the United States. Now we are working on increasing our share in the domestic market. If our products occupied 10% and we manage to borrow 15%, theoretically this will cover losses of 20-30% from exports. Therefore, we have a lot to develop in the domestic market as well. We are not going to quarrel or break off relations with our partners from “unfriendly countries ” and we do not experience any political moods in business. Only high-quality marketing, product and service-that’s what we are interested in. Who likes it and wants to buy it from us — welcome.

 

— What advice can you give to brands who want to work for export?

Building new connections is more difficult now than it was 5 years ago. But at the same time, any crisis is a time of opportunity. While the rest of us are waiting, someone else can break in and take a share of the market, those “who is waiting for good weather”. Therefore, the advice is: try it out, communicate with dealers, logisticians, and exporters, and look for options. Bitcoins, re-export and other new business terms will help you;)

 

 

Vyacheslav Kournikov-co-owner of UNION/Vesper companies

 

– Good afternoon, Vyacheslav! What countries are you currently working with?

Hi! I don’t see any point in listing all the countries, the list is impressive. From the main ones: Australia, Japan, China, India, Canada, USA, almost all of Europe and the Middle East.

 

-What percentage of products go to the export market? How important is export to you?

About 50% of sales are exported. Some of the products sold on the local market also go abroad with the help of our partners in the Russia. 

-How much has the events of recent months affected your supplies? Did you manage to adapt to modern realities?

I published several posts in the telegram channel about what is happening in the market. In the last days of February, a complete chaos began with the prices of raw materials, many were not ready for what was happening. But not us.

We had a stock of finished products, as well as a stock of steel in production, so we were able to wait out a month, working at the old prices.

Starting in April, metal/plastic prices began to roll back. Of course, not up to the previous values, but you can already work with such capacities.

During these two months, I realized the main thing: many of our partners are still ready to develop joint business. Thank you to them, appricate it.

I remember getting a call from a distributor in Prague — Alex (Ismoke)

– Hey, how are you?

– Hi, it seems normal, I don’t understand it yet)

– Look, it doesn’t matter who has anything to do with what’s going on. Our personal relationships remain the same, and we will overcome everything. Wait for your order!

In fact, the adaptation is just beginning: right now, many supply chains are breaking down, and the inventory that was delivered earlier is running out, and new payment/delivery routes are being built. No one is going to give up. We love our business, value our partners and our team.

 — Do you think that in the near future you will find markets for selling products to replace those that you lost? And will the situation with the existing countries change?

How do I make forecasts now? I just don’t even want to do it. Of course, we will make efforts to increase sales.

The market is now floating: somewhere it has decreased, somewhere it has arrived. There are a number of countries with good potential that we are just starting to enter. We prepare a lot of gifts for large chains, local stores and hookah bars in Russia.

 

 — What advice can you give to brands who want to work for export?

Study the specifics of each market, the smoking culture is different everywhere. Think immediately about how the sales chain will be built: whether it is worth working through a distributor or conducting open sales. If you are considering working through an exclusive distribution service, you should study the market share that your future partner holds. Prepare an agreement that clearly defines the responsibilities of each party and the terms of cooperation.

       

All the companies we interviewed, agree on one thing-hookah exports in Russia are going through a difficult period, but do not worry, no one is going to finish their work, and manufacturers will continue to please us with their products.

As you know, in Chinese, the hieroglyph “crisis” has a second meaning – “possibility”. And this is not without reason. Any problem and its solution will definitely raise us to another, higher level.

#hoob
#Hookah Battle
#Interview
#Japona hookah
#maklaud
#union

1 comment

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Ох уж эти китайские иероглифы )))

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