Our first production of semi-automatic washing machines started in 2009 in Kanev city, Ukraine. Up today, washing machines produced by KTD Cherkasy, are still popular among all residents of small towns and villages.
After successful start-up of washing machines project, KTD Cherkasy took a decision to invest in development of new categories of home appliances. Later on, such projects as electric kettles, food dryers, hand mixers, fan heaters, meat grinders – were launched. Along with small home appliances, KTD Cherkasy took a decision to make extra investments in development of white goods. Thus, in 2015, new factory in Cherkasy city was purchased to produce different kind of white goods and small home appliances containing metal parts, such as refrigerators, electric ovens, convector heaters, standing fans, metal electric kettles. In manufacturing process, both factories use most modern and advanced equipment with active participation and control of leading Chinese engineers.
The journalist of Economic edition “Personal account” took an exclusive interview in the director of the plant “Kupava” Michail Dodonov
As we beat out Chinese
Household appliance manufacturers from Cherkassy deprived of leadership of Chinese ones.
It's not a secret of the dominance of the products from China on the shelves of our stores. Cheapness is the main competitive advantage of Chinese manufacturers. Whereas the quality leaves much to be desired. This was at the market of household appliances too. A few years ago only global brands could compete with Chinese manufacturers. Such appliances work better, but they many times more expensive. At the same time it was impossible to find a quality domestic product in this diversity. It simply did not exist in nature. The old, still Soviet factories that produced household appliances for home have been destroyed and looted long ago and it was much more profitable for entrepreneurial people to import products from the China than to set up Ukrainian production on home land. For many, but not for all. There were enthusiasts who decided to take a risk and create domestic production of household appliances in Ukraine. As for instance, a group of companies KTD-Group, headed by the president Alexander Gromyko, who took his chance to invest his capital to the creation of new modern plant «Kupava» on production of semi-automatic washing machines in the town Kanev, Cherkassy region in 2005. Since the generation of the idea to the release of the first, then still experimental machine four years have passed. First washing machine left the plant’s conveyor in January 2009. Next were months of testing of a new product, precise adjustment of technology capacities, obtaining certificates of conformity. And since June 2009 Kanev plant «Kupava» began serial production of Ukrainian semi-automatic washing machines, including machines of the brand “Saturn”.
Current plant’s director Mikhail Dodonov calls "patriotic step" the fact of the existence of the plant «Kupava».
"The President of our group of companies KTD-Group Alexander Gromyko, who visited Chinese factories producing household appliances many tines, was constantly wondering, if our country, with such potential, would do something like that? And the decision to create plant for production of semi-automatic washing machines was taken." Five years ago, when production on plant «Kupava» just launched, 100 machines a month rolled off the production line. Now we have 10-15 thousand machines a month of one washing machine a minute. "We went through a difficult process of establishment: equipment were mounted, the team was chosen, specialists were trained and reliable suppliers were found. It was very hard, but the result did not disappoint. Nor us nor our customers ", - said Mikhail Dodonov.
It should be noted, that the products of the plant «Kupava» really produced in Ukraine, but not assembled from imported parts, as it happens in other industries, who loudly proclaim their "Ukrainian citizenship." "Our production is 100% Ukrainian," - emphasizes Mikhail Dodonov.
Today Kanev plant «Kupava» is equipped with modern thermoplastic injection automatic machines suitable casting the parts of any size. The plants receives orders from leading retail chains. The output capacity of the plant is 150 thousand washing machines a year. The enterprise employs 1200 highly qualified specialists: engineers, casters, electricians, etc. High quality of yielded products meets the European and Ukrainian certificates of conformity. The company has modern warehouses, advanced logistics with its own management.
Group of companies KTD-Group is not going to be satisfied with what has already been achieved. In the middle of last year when many businessmen left the market, the management of KTD-Group has once again decided to develop production. The strategic goal of «Kupava» plants is to increase manufacture of quality products and enter the European markets with them, to Portugal itself. Now the negotiations about the delivery of the household appliances by the order of various famous brands such as Saturn, Laretti, Electrolux, Zanussi, Russel Hobbs and others are underway. Majority of Chinese factories adhere to the same principle of work since it is too expensive project to develop your brand. It is much more efficient to invest capital to additional capacities. But notwithstanding from the brand names, their design and packaging, they will be united by one thing – the highest quality of the «Kupava» goods with a proud label “Made in Ukraine”.
The director of the plant «Kupava» Mikhail Dodonov told us about the prospects of production development in an exclusive interview.
There is not very attractive business environment in Ukraine: high taxes, a huge army of inspectors, an ineffective judicial system, etc. Why these deficiencies were not an obstacle for your company?
- It is very loyal attitude to business activity in Cherkassy region. You’ll never see the inspectors who are trying to squeeze entrepreneurship. On the contrary, Cherkassy governor Yuri Tkachenko fully supports investors. He takes care of that new production facilities will be opened in the region, about creation of new workplaces, about filling state treasury with taxes. We see no obstacles to business development.
Development during the crisis?
- Our President, Alexander Gromyko, has decided to start production of refrigerators in Ukraine. There will be not enough Kanev facilities for this goal. Therefore, additional production site on the basis of one of the Cherkassy plant was found. Release of the first refrigerator is scheduled for June 2016. The plans are ambitious. Hard work ahead. Not everything is simple. We understand that the task is serious, and we are working on its realization.
Will Kanev plant «Kupava» produce only washing machines?
- No. The production line for household food dryer was started this May. Our goods has already entered all the supermarkets, and this summer everyone can buy food dryer of TM "Saturn" produced in Ukraine. This summer production of four models of fan heaters is launching. And this autumn five models of electric kettles will roll off the line
You need reliable suppliers at such big production. Where do you find them?
- When a big plant is being opened, production of components is opened near it. For example, Kharkiv and Khmelnytsky production of power cords. And we are ready to buy Ukrainian components, but at reasonable cost. Unfortunately, this is not always the case. We are now forced to buy engines, pumps and timers in other countries, because their price in Ukraine is uncompetitive. We are ready to pay more for Ukrainian engines, but not twice! I do hope that production of components for washing machines will be created in Ukraine. And in meantime we have to import them abroad
Won’t it be easier to organize the production technology in China, and to deliver already produced goods to Ukraine?
- Of course, it's easier! Especially in the business establishment stage. But we already compete on price with Chinese and preparing to break into the European market. Such chance came after the abolition of import duties on Ukrainian goods to Europe. By the way, a food dryer produced this May at the plant «Kupava», came out under brand "Saturn" “Made in Ukraine”. Our strategic goal is replacing “Made in China” to “Made in Ukraine” throughout Europe!
When you are going to enter the European market?
- The first shipments of our products will be delivered to European countries already this year.
What are competitive advantages of Ukrainian products in Europe?
- Let us speak frankly: Chinese manufacturers have learned to produce household appliances with different production cost, which differ in times. Goods are similar in appearance but quality differs. considerably. We're not looking for quantity tradeoff in quality: we use quality European plastic, reliable engines, pumps and timers. Strict quality control system has been developed and implemented. Each employee is responsible for any defective products. So Ukrainians can provide European countries with quality products and at competitive cost.
The cost of your products is significantly lower than in competitors. How did you do it?
- We put our heart into it. Low cost is the result of the correct choice of raw materials, components, competent marketing and excellent work of engineers as well. That is a large complex of correct professional work: starting from the purchase of raw materials and ending with advanced logistics.
Are you not afraid of the low purchasing power of population in Ukraine?
- Frankly - yes, sales has fallen. We understand very well what the situation is in the country. It is clear that even products with unique properties will be sold badly when there is a war. But I repeat once again - we are working for our people. We believe in our country