Virtual exhibition BUSINESS-INFORM 2020-2022

German Plotnitskiy, CEO, BULAT Group (Moscow, Russia),

 answers the questions of Information Agency «BUSINESS-INFORM»

1. An overall current economic situation in Russia as well as abroad is being defined by the COVID-19 pandemic crisis. In your opinion, how is this going to affect the Russian market of the printing supplies in the perspective? Are you planning to adjust your company’s activity to the situation? 

This is hardly the first crisis that has ever happened on the market and with our company. The previous ones had their hidden stones; however, in no circumstances we would have terminated our business activity and faced any irreversible consequences for the industry. It doesn’t seem that the current crisis is going to be an exception; though it looks more freighting and jeopardizing. Surely we understand that inevitably there is going to be a subsidence for the market of equipment and consumables. However, the consequences of this subsidence will be different for every company. It will be most difficult for those making the living from trade only. On our market, most of these companies failed to learn how to speculate for a rise. Speculating for the decline will be fatal to them. From my point of view, it is inevitable that small distributors and local dealers will start leaving the market. Big businesses will undoubtedly stay afloat, although, it will take a lot of strength and resources to keep their position. It will be a little easier for those who thanks to their own production have a possibility for a deeper price and product maneuver. Their losses will be smaller, however it won’t be easy for them. Absolutely, there is going to be an escalation in a battle for tenders and big businesses as customers. However, in today’s situation even big businesses can be a vague source of income. The forthcoming payment-delays-crisis is an issue of its own. As for our company, Bulat Group comes from a category of companies that live by their own decisions. More than 75% of the company’s turnover refers to the goods produced at our own manufacturing sites. Our business model enables us to quickly fold and unfold our capacities to satisfy the needs of our customers. Moreover, this enables us with no loss in dynamics to support our regional partners and strengthen ties with key clients who hold long-term state contracts. 

2. What is the share of remanufactured cartridges or products for remanufacturing in your company’s sales? In your opinion, what are the prospects for remanufacturing industry in the Russian market? 

Half of our stock consists of remanufactured cartridges and goods for remanufacturing. The other half refers to brand-new cartridges, one third of which we produce ourselves. Thus, the remanufactured cartridges, goods for remanufacturing and Russian made brand-new cartridges constitute the majority of our product range. As for the remanufacturing industry, our company, being an engineering and manufacturing company, constantly interacts with partners all over the country. Therefore, we are aware of the current situation for the market and what it hopes for. During the last few years we have seen everything: cheap Chinese cartridges against which no defense has been invented yet as well as “pranks” from customers like Federal Law 44 and environmental limitations as in our “best” traditions. But the market has survived nevertheless! More than that, it remained rock steady to all adversities to the last. However we still see some issues: not enough money to purchase equipment, staff shortage begins to show up. With various Chinese manufacturers having multi-million marketing budgets, it is getting ever more difficult to prove customers why a Chinese new-build cartridge operates worsethan a remanufactured one, and so on and so forth. Taking it into account, we’ve previously launched several new projects to support our industry. The first results make us think we have made the right decision. We believe the market will overcome today’s challenges, and with the correct support from big companies will be stably and highly profitable for its players. 

3. In this magazine you can find a discussion between 2 well-known experts, Volker Kappius (Delacamp) and Steve Weedon (Pelikan, Print-Rite), speculating on the levels of hazard of new-build cartridges. Volker Kappius assumes that the new-build cartridges jeopardize the environment, have poor print quality and lower durability, and, finally, they are of single-use, while Steve Weedon, on the contrary, sees no hazard in the new-build cartridges. Moreover, he points out that ОЕМ and remanufactured cartridges are as hazardous as the new ones. Also he adds that it is possible to remanufacture ОЕМ cartridges only once. So who is right, in your opinion? 

These two experts belong to two different competitive systems. Each defends solely his own business interests in this discussion. And this debate really resembles the old polemic on which was first, an egg or a hen. In my opinion, in this case they are both wrong. The matter is a lot more complicated. We are going through hard times, as we never did before. OEM manufacturers and aftermarket players are in the same boat. The roots of the matter are hidden way beyond the polemic between these two gentlemen and are determined by a historically set hierarchy of the operative electrographic printing market being demolished now. I believe, we are going to face huge changes in the two upcoming years.

We think there are reliable, high-quality and eco-friendly supplies and the ones that are not compatible with these criteria. Both leaders and outsiders offer all sorts of products.

Very representative in this matter is “Laboratory of Electrography” that carries out a huge amount of tests, as we may say, “blindly”. Often you can hardly notice the difference between ОЕМ and non-OEM products. Therefore we agree with those who believe that the LEM-method is the only way to measure quality and not the bravado of the market players. 

4. Sooner or later, the COVID-19 pandemic will come to an end. What is your company planning to do in a new reality? Isn’t it time to unite for all the remanufacturers and to ask for governmental support of the industry? 

I have already mentioned that our company’s mission is to support remanufacturing industry and consumables production in our country. We possess a unique (for Russia) experience in design and implementation of electrographic printing projects. All the history of Bulat Group proves its aspiration to make Russia at least partially independent from the import of printing products. As of today our major efforts of supporting the industry have resulted in a number of projects aimed to thousands of engineers active in our field. We supported the initiative of the “Laboratory of Electrography” to set a unified printing standard LEM in Russia as well as their plan to implement an all-Russian voluntary printing certification system in our field. We were actively involved in design and launch of training and retraining center for field experts, which virtual doors opened in April this year. To involve a large number of service companies in work with large customers, we designed a unique platform able to coordinate and service large and complex projects. This in turn led us to realization of a necessity to standardize refilling and remanufacturing services as well as placing them on drastically different technological and business level. We designed systems for technical specifications and instructions that were welcomed by our partners.

All that can become of interest not only for our company, but for the whole community as well. We set high hopes on the Association of Quality Consumables Manufacturers and Suppliers (AQCMS), which we belong to. We see the Association as a force capable of bringing the market back from the shadows and giving it a chance to prove it can become a touchstone for its own electrographic manufacturing like it happened with China. 

Details: BUSINESS-INFORM Review (issue #27, 2020)