Zaporizhzhia cable for everyone

Even in such a competitive market as the production and sale of cable and wire products, you can create a successful company. The leaders of MPKA LLC (Zaporizhzhia) told about their experience.

In 12 years, the new MPKA-Ukraine Company has won about 11% of the market in the segment of manufactured products and gained more than 3,700 regular customers, including MHP, Globino, Arcelor Mittal, Wind Energy, Onur Group. The brand’s products are chosen by more than 5,200 regular consumers. Cable is a specific product, strictly regulated by the parameters of DSTU and GOST. It is difficult to differ from other manufacturers in quality and marketing. How does Zaporizhzhia Cable Plant attract customers?

In 2007, three like-minded people: Dmytro Skliar, Viacheslav Stechyshyn and Ihor Viter seriously analyzed the cable market in Ukraine. “The post-Soviet system of sales, service and management has become outdated. There was no service at all. Consumption of cable products was high, and demand exceeded supply. Managers just sat and waited for a call from customers,” Dmytro Skliar, the current project manager and co-founder of MPKA-Ukraine LLC recalls.

Friends decided to create their own company with a fundamentally new approach to sales. With planned sales, phone calls to customers, visits, service on price, delivery, the formation of product availability in warehouses. Initially, products were sold without a warehouse – immediately delivered to the consumer, then they could not yet form warehouse stock balances in large scope. Six months later, they began to create warehouses with finished products. “The warehouse is one of the elements of the service when the consumer needs the product "for yesterday" and no one wants to wait for the production for 40-50 days,” Ihor Viter, the co-founder of the plant and director of the company says.

Partnership was established with Pivdenkabel Plant PJSC, Berdiansk Cable Plant PJSC, whose products were supplied throughout Ukraine. Until now, MPKA-Ukraine is the official representative of these two powerful cable market operators in the country.

The new company has set the goal – to give the market a quality service of product availability and fast delivery to the consumer. ABC-analysis is performed once a quarter – after all, no one will load warehouses with those products that are not in demand. Those products that have turnover and financial attractiveness are always in stock, others can be put into production in the shortest possible time with delivery to the facility or warehouse of the customer.

The main consumers of cable and wire products – electrical organizations, developers, industrial enterprises, distributors and construction companies – face many problems of service. “There are many manufacturers, and the competitive component lies in provision of quality service,” Viacheslav Stechyshyn, the company’s co-founder, Development Director explains.

Kilometers and tons of cable

“In Ukraine, no cable plant can make the entire range of cable products,” Dmytro analyses. Some plants produce general industry products, other plants produce high-voltage cables, cables for the mining industry, specific cables for nuclear power, cable and wire for rolling stock...

In early 2016, it was decided to build own production complex. And in January 2017, the first kilometers of wire and cable went out of the production facilities of the enterprise. “We have earned and continue to earn investments. We use credit products, but 80% of funds are money that was earned,” Skliar clarifies.

They acquired automated production lines, which allowed to manufacture their own products: extrusion lines, general twisting lines, shielding machines from European manufacturers.

“Cable is a very financially expensive unit and quite an expensive product,” Skliar says Sklyar, “Now we process 35-40 tons of copper-aluminum raw materials in the planned mode, in the unplanned we reach 50 tons. The level of investment component for the production process of this group is clear.”

The products can be estimated in terms of footage and be proud of 580 thousand meters per month. Only high-quality raw materials are used in production: current-carrying core consisting of 99.99% of electrotechnical copper and electrotechnical aluminum, plastic compound of the European level. Product quality is strictly controlled at every stage of production.

Peculiarities of sales

MPKA-Ukraine sells products through traditional channels: phone calls, personal meetings, exhibitions, etc. Owners are also in the daily process of communicating with the team and large consumers, in which decision-making is at a high level of communication. “Deciding where to buy a cable depends on many factors. For example, if a consumer wants to buy products for a large amount, it must be confident in its supplier, has a right and wants to communicate directly with the top management of the company,” Dmytro Skliar explains.

The chief power engineer of the enterprise, the owner of the agricultural holding, the manager of power electrical installation projects are different decision-makers with which MPKA Zaporizhzhia Cable Plant finds a common language.

“First of all, no agreements regarding the price are violated. The prices stipulated in the contract are not reviewed. The goods are sold based on the territorial division of the country. Regional managers are responsible for their territory and they work with all segments. There are distributors in the region and end consumers may purchase the goods at the price “x” from us or the distributor,” speaks Dmytro Skliar about the advantages of his company. He thinks that one-sidedness of sale segmentation leads to problematic issues at any enterprise: price gradation shall be defined, so that the cooperation would be interesting both for end consumers and dealers.

 “The situation with distributors is rather complicated”, admits Dmytro. “As a matter of fact, the distributors are wholesale companies, which may ship and sell certain products to end consumer in the region. After the crises in 2007 and 2014 agreements and contracts on the sale of cabling products in the market were abruptly redrafted.”

At the same time, the company is not only a developer, but remains the distributor of a range of big cable factories. There is one subsidiary in Kyiv and the products are sold from here to the nearest territories. 

MPKA-Ukraine transports regularly cabling and wiring products to Moldova, Georgia.

 Service and again service

“We are not just a company, which manufactures and sells own products, we are the company, which lives with the consumers, their questions, problems, situations”, says Dmytro Skliar. “Our key to success is the owners’ position as the set goal, systematic efficient work of founders and the team, service of high quality”.

The company generates warehouse supply – it means that the products may be ordered today for tomorrow. The advantage is the operational efficiency: if the order was sent until 12 A.M., it is shipped on the same day.

MPKA-Ukraine has own transport, which may carry from 700 kg to 20 tons for the immediate delivery directly to the consumer’s warehouse or object. “In such a way we perform a range of tasks instead of the consumer and provide risk mitigation: the cable is expensive, and the risk is high that the transporters may damage the goods, which is unacceptable”, notes the businessman. It should be noted that the respective cabling products delivery services are provided only by approximately 20% of producers.

The products are manufactured in the cable package – this component is also expensive. “Some producers include the price of package into the price of the products – we are not doing so and in addition we collect the goods with own cars”, - it is an important component of the service. “We do everything to retain consumers and help them to settle an array of complicated tasks. The future belongs to the service. In 2-3 years one won’t be able to do business in the cabling industry without the servicing”, Viacheslav Stechyshyn forecasts.

As a top manager, Dmytro Skliar believes that his task is to form a team and build business processes. Cabling products sales manager should be able to communicate with the business owner, commercial director, development director that value the efficiency of the supply, reliability of the supplier, as well as chief power engineer, chief engineer of the enterprise that value high quality and expertise of our employees in the cabling product industry.

Overcoming circumstances

Many Ukrainian entrepreneurs are used to feel like victims of the circumstances under the conditions of constantly changing working conditions. “MPKA-Ukraine” was founded during the crisis in 2007-2008, managed to deal with termination of the connections with Donetsk and Crimea regions in 2014 and change of the supply geography. In 2020, the quarantine restrictions affected mainly customers from small business segment. We had to take a range of anti-crisis measures.

MPKA-Ukraine made their conclusions: they prepare for the next wave of the quarantine and crisis, reformat the ready-made products in the warehouse. They optimize funds by creating a “financial cushion” to protect business and staff.

“We are on the stage of Zaporizhzhia Cable Plant MPKA brand development  and intend to supply the market with our products of high quality”, speaks  Dmytro Skliar optimistically about the future.

Cooperation with Raiffeisen Bank Aval:

Dmytro Skliar, director and co-founder of the companies MPKA-Ukraine LLC and Forum-Alliance LLC:

“In 2006 we opened our first account of the legal entity with the bank. Back then it was convenient, first of all, in the territorial aspect, later we understood that the managers are very attentive and are always ready to help settling any issues related to the business servicing. We use regularly credit lines and overdraft option, when we need to settle the issues related to the raw materials supply. We are satisfied with the servicing. Furthermore, many tasks are now solved remotely without the visit to the bank”.