How far has the group come in the last few years in Kazakhstan?
YURI BABICH In the last two years, Americana Group has witnessed strong growth in Kazakhstan. Today, we operate four major international brands and over 60 outlets across the country, with further plans to open another five to six stores by the end of 2017. Americana represents KFC, Hardees, Costa Coffee, and Pizza Hut in seven cities in Kazakhstan: Astana, Almaty, Pavlodar, Karagandy, Shymkent, Atyrau, and recently Aktobe. The demand for our products has been increasing over the last few years and we expect this to continue. Consumer appetite has been positive, and we see a great deal of potential in other cities. That is why our focus in the coming years will be to grow our footprint and expand our presence geographically into new cities across Kazakhstan and other markets in the region.
DMITRIY PROVKIN We have developed rapidly, especially in the last five years. We are opening many new stores; thus far, we cover all the major cities with populations over 50,000. We currently have 101 stores and 29 smaller telephone stores of a limited assortment. We also have two stores in Kyrgyzstan and were the first Kazakhstani company to enter that market in 2016. Regionally, the development of our company started in the south of the country and we have a strong position in that region. We also have activity in the north and west. Currently, most of our expansion and development is focused on the north. Astana is the fastest-growing city and market in the country as a result of Expo 2017. We put our efforts there and plan to open more stores in that region. In terms of international expansion, we plan to open more stores in Kyrgyzstan.
What areas of opportunity do you see for the company moving forward?
YB We are doing a great of work with our current line of brands in terms of their overall look and feel as well as expansions. For example we currently have only 12 Hardee's stores and we have great opportunities to expand the brand. We also have great opportunities for Costa Coffee in Kazakhstan. At present, we have a minimal presence; however, there is a strong appetite for coffee in the market and our target is to make the brand more visible and accessible to our customers. In terms of bringing new brands to the Kazakhstan market, we may have opportunities to introduce some new casual dining restaurants, though this will likely take place in 4Q2018 or even 2019. We have a great deal of work to do with our current brands to make sure that we remain market leaders. If we are to introduce a new brand to the market, we need to be well prepared in terms of understanding the segment, demand, and target audience as well as the supply chain logistics and infrastructure that would support any new brand.
DP We see huge potential in e-commerce. It is clear from the activity in other markets that doing business and making transactions online is the current trend. Sooner or later, it will also come to Kazakhstan in full force. Over the past five years, the growth of our online channel has been huge. Seven years ago, we began investing in the infrastructure of our website. Now, our online store is by far number one in the sector. It is extremely convenient for our customers, though it hasn't completely caught on yet, and that is because consumer electronics are becoming more complicated. Our strategy is to develop multiple channels with multiple teams. We follow a “multi-channel" strategy that allows consumers to have access to multiple channels, such as online, over the phone, or in-person. Our main advantage is that we have a strong online presence with a great website as well as traditional, conveniently located stores that are close to our consumers on major roads. These two channels feed each other in this way. Additionally, we have a unique feature in the market: separate, branded departments in our stores that offer services for consumers with different needs.