How studying at the Furniture Business Management School, helped FROP become a team and improve its performance.
Vasyl, please tell me, how did the idea to engage in furniture business occur?
One day I received a proposal from my current business partner to invest in furniture business. I did not know anything in this area because I was an engineer-geologist according to my education and worked abroad all over my life on oil wells in Dubai, Norway, Saudi Arabia and Qatar. But I always dreamed of doing my own business and, in principle, in Ukraine in order to develop my homeland. The proposal of my future partner was very relevant. We joined forces and founded FROP, a furniture manufacturing company.
Your company is quite young in the furniture market – it is four years of age. During this time, furniture of your production has already appeared in the most popular restaurants, hotels, business centers throughout Ivano-Frankivsk Oblast. How did you succeed in becoming so popular and successful for such a short business term?
From the very beginning, we focused on founding a company customers would like to deal with. And everything is important in this regard, namely from branding and, of course, to the quality of goods. We responded with great responsibility and caution to executing the first orders. And customers are usually willing to recommend someone they like to their surroundings. Our first customers were satisfied and they started to recommend us to their friends and partners. Thus, we almost immediately signed contracts for long-term projects. I think our success is in our responsibility. And still, we are not afraid of complex challenges and we are constantly learning.
There is a huge competition in the region: there are dozens of large and hundreds of private small producers. What are the competitive advantages of FROP’s furniture?
The most important thing is the technologically properly prepared raw materials. By the time of shipment of finished products to the customer, the raw materials undergo dozens of different operations: settling of wood, drying, painting… Many furniture manufacturers skip some operations with raw materials. It lowers the cost of production, but poorly affects its quality. We do not allow it. Because we strive to ensure that during operation microcracks do not occur, the appearance does not spoil, and that our furniture has served people for many years. We use domestic durable wood, in particular the Carpathian oaks in production. At the same time, we never mislead in terms of customers’ expectations and always fulfill the production deadline.
And who are your customers?
We manufacture custom-made designer furniture. It means that our projects are different because they are designed for certain spaces and must meet the needs of users. We design on our own. The choice of materials, quality control, and customer service are all important steps that affect the final result. We work for private and commercial objects. For example, our furniture is in such restaurants as Josef Strudel, Factory, Delikacia, Wine and Meat, and Feterbush. Our furniture is also in such hotels as Stara Pravda and Fomich. Intelligent Hub Business Center is equipped with furniture of our trademark. And with Promprylad, for example, a cooperation agreement was has been signed till 2020. Outside our region, we work with restaurants in Odesa. We are currently negotiating with Epicentr about further cooperation.
During your period of operation you managed to enter the international market. Who do you cooperate with and where do you export furniture?
Recently, eight Ukrainian furniture companies have entered into agreements on furnishing three thousand apartments in Israel. Our company is also involved in negotiations with buyers from Israel. We are preparing to deliver the following serial production furniture there: coffee tables, TV shelves and book shelves.
Do you plan to enter the EU markets, and if so, what do you do for this?
We are preparing and working to start exporting to the EU markets this year. In general, the “made in Ukraine” brand is by no means inferior to foreign brands, and we are quite competitive in this segment. The EU has a number of requirements for the product exported there. For example, we are talking about the correct packaging as well as the FSI Quality Certificate, which should confirm that our products are made from licensed wood. Currently, we are working on obtaining such a certificate, since it will allow us to move calmly and confidently to the EU markets.
You have recently completed a course at the Furniture Business Management School. The event took place within the framework of the EU4Business initiative with the support of the European Bank for Reconstruction and Development (EBRD) in Ukraine. How useful such training was for you and how do you plan to translate the knowledge gained into your production?
It is continuous learning and improvement that is one of the basic principles of our work. I often attended different trainings and seminars. It was disappointing quite often because the money spent did not correspond to the knowledge gained. Therefore, studying at the Furniture Business Management School became a great discovery. This was a really important project that really provided the necessary knowledge. The training lasted for four months and was divided into four modules: marketing, management, sales and finance. Everything had little practical sense and was useful and logical. The format of gaining knowledge itself is a relaxed and friendly atmosphere; all participants were involved in the discussion, everyone shared their own experiences. it was rather a strong team, namely good speakers with international experience. There happened even something I did not expect: we all transformed into partners from competitors. When I returned to work, I was energized and wanted to change almost everything. For sure, there was no need to change anything, but to reconsider approaches, understand personal mistakes and tune in to another level made sense. The first thing I did was that I changed my approach to communicating with the staff, counting on the teamwork and discussing our successes, mistakes and methods. After that, we reconsidered the effectiveness of using resources, and closer approached our often rash spending. Modern, environment-friendly and efficient production of our company – it is all thanks to the knowledge gained.
How much did this training cost you or your company?
Most of the expenses were covered by the EBRD. We paid a token amount of EUR 200.
How did you find out about the program and did it meet your expectations?
Volodymyr Patis, Chairperson of the Ukrainian Association of Furniture Manufacturers, recommended me to attend the training course. The program exceeded my expectations. It was very professional and effective. After the Furniture Business Management School, I stopped attending any other training programs.
You said that after the training you changed approaches to personnel and management of the company. And how did such changes affect the financial performance of FROP?
We had a complete reorganization of the company; in particular, we introduced a cost-effective production and started to use the resources properly. Most importantly, our performance doubled. Previously, workers performed their work mechanically, namely from morning until night. For example: they grind wood and do not even know why. The team is now involved in ALL processes and discussions: we analyze the accomplishments, successes, failures, shortcomings, develop a strategy and set goals together. We started to break the thinking, which was the toughest. But we are developing faster and our employees earn more. And we are all satisfied with this state of affairs.
By Mariana Tsymbaliuk