TBY talks to Elshad Abbasov, General Director of Embawood, on furniture manufacturing, distribution, and retail, as well as the importance of boosting “Brand Azerbaijan.”
TBY How would you assess Embawood’s business activity over the past decade and a half in the furniture industry?
ELSHAD ABBASOV We started operations in April 1996 with seven employees in a rented 300-sqm building. We have since expanded from seven people up to seven factories. In 2001, we established the office furniture brand Ideal Design. A year later, our second factory started to function in Khirdalan. We have also been exporting our products, taking an important share in foreign markets. The main strategy of our organization is to be close to our customers, and we are trying to establish the relevant infrastructure in foreign countries in order to implement this strategy. We want to stand behind our products because we stress both the importance of the sales process as well as after-sales service. A year after we opened, we established the first quality testing laboratory in the CIS. Later on, we launched two more brands, Madeyra, a second home furniture brand, and Dolce Noche, a mattress brand. Embawood’s product portfolio has been growing along with the company. Over time we felt the need to address the market’s increasing trend toward more modern and better designed products. Therefore, we launched Madeyra at a point of transition for Embawood to broaden our range of target customers in the market. At present, we have 66 retail locations using this name, and we are planning to increase this number up to 80 in the near future. Embawood has operations in 10 countries, with seven factories located in key regional markets such as Azerbaijan, Georgia, and Ukraine, as well as boasting a global retail sales network of more than 200 outlets.
How has Embawood sought to promote the company as an Azerbaijani brand abroad?
Our representatives, colleagues, and partners abroad are actively promoting Embawood as an Azerbaijani brand. We believe that the increasing popularity of our products shows the heightened interest in Azerbaijan. Embawood also participates in furniture exhibitions every year, and both factors prove that we have been able to follow trends in terms of furniture production and successfully promote Azerbaijan abroad. International exhibitions allow us to keep up with furniture production trends and innovative equipment, and also help us to build relations with foreign state representatives and businessmen, and we are using such opportunities as an additional means of promoting our country.
What are some of Embawood’s main products, and how much are you producing?
Although we started up using small capacity infrastructure and equipment, we have gradually adjusted our production capacity and equipment to meet market demand and satisfy the company’s needs. The period following the year 2000 was the turning point in our activity; we expanded our production by establishing an upholstering board division, started the production of office furniture, and acquired a second factory in Khirdalan. We initiated the export of our products in 2002. Overall, our present furniture production capacity is 35,646 sets per month, 99,480 sqm per month in lacquered wood, 26,130 sqm per month in PVC façade production, 871,267 sqm in melamine board production, 2,808 pieces at 160 x 200 centimeters, and 5,616 pieces at 90 x 200 centimeters in the production of spring mattresses, and 4,524 sets per month in the production of upholstered furniture.
What major trends have you observed in both the domestic and foreign markets?
The Azerbaijani market currently has enough capacity and great development perspectives. We expect an increase in furniture demand due to the rising purchasing power of Azerbaijan’s population and also an increase in the frequency of people changing their furniture. Nowadays, the frequency of replacing furniture in Azerbaijan is 15-20 years, while in Turkey it is 7.5 years, and between four and five years in Europe. This will consequently lead to an increase in domestic demand. Competition from Turkish companies in the market is increasing year by year. A similar situation can be observed in the foreign markets we are active in. However, Embawood stands above its competitors because of the high quality of its products. Another advantage for us in foreign markets is that we are a well-known brand already. Our strategy is to stand behind our products and be close to our customers, and that has brought us consumer loyalty, creating a strong relationship between both parties.
How do you ensure high quality standards at every stage of the production chain?
Embawood takes its quality controls very seriously in all spheres of its business activity and the production process. Therefore, we assess raw materials from our suppliers, we supervise materials during the whole production process, we test our products, and above all we ensure customer satisfaction. We have paid special attention to two key aspects: the quality demanded by our customers and that required by international standards and norms. These two criteria contain the basis of our quality assurance system. In terms of production, at the end of the manufacturing process the completed products have to pass various tests in our quality-assurance laboratories. In addition to the production process and the equipment we use, which has been purchased from leading European companies such as HOMAG and Bürkle, we have the capacity to employ the right kind of human resources. We regularly send our staff on courses and relevant training seminars so they can broaden their skills and improve their qualifications. At the same time, the standardization of workshops is one of the major aspects improving the quality of our products. Finally, after the product is delivered to a customer, mutual relations are built and we rapidly resolve any deficiency or mismatch found after the sale.
Where do you see the company in five years?
Our company’s business strategy covers the period between 2010 and 2015. The major development priority of our strategy is to focus on our customers and to further develop our distribution channels. Our aim of focusing on the customer is to provide high-quality innovative products, to develop new service areas, to increase brand loyalty, and to apply different elements of retailing. At the same time, we intend to increase the range of our products. We are also planning to take certain measures in managing warehouses, logistics, and distribution channels, so we can provide faster and higher-quality services, and optimize the management system of our warehouse distribution network.
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