GROWTH POTENTIAL IN ATYRAU AND AKTAU

Kazakhstan 2018 | TOURISM | VIP INTERVIEW

TBY talks to Aslan Koishubayev, CEO of Baytak Dala, on the retail construction sector, accessing more clients, and objectives for 2018.

Baytak Dala was set up in 2009, which was a difficult time for the global markets. What opportunities did the company's founders see in the retail construction sector at that time?

Baytak Dala's founders were working on construction projects in Aristan EPC in 2009. For various reasons they decided to leave Aristan and open their own company in the same field of construction and fitting out retail stores and malls. The initial years were difficult because of the global economic crisis and the fact that we only had a few malls. Mega Mall was a pioneer in Kazakhstan. Our founders realized this is the future for retail and the sector would continue to grow for another 10 or 20 years. They therefore decided to grow in this direction given they already had experience in terms of the specifications, requirements, and rules in the construction field.

How has the business evolved and expanded its line of work?

We focused on stores because we did not want to work in every area of construction. By specializing in this niche area, we have been able to build up our experience, qualifications, and reputation with an emphasis on quality. By providing a quality service, we satisfy our clients and that ensures they will continue to work with us and, more importantly, recommend us to new clients. This is how we have built up our client base over time and captured bigger clients as the market changes. Baytak Dala has completed around 250 projects across 16 cities in Kazakhstan. To begin with, we only worked on two stores when we started construction work in 2010. We started working with the Almeo Group on two stores in the Mega Mall for the Cortefiel and Springfield brands. Our founders were working in Kazakhstan so they knew the Mega administration and the client who decided to work with us. They gave us two stores to start with on the understanding that if we did the work well, they would continue their relationship with us and give us other shops to fit out. Mega Mall saw that our work was of a high standard and recommended us to new stores. Our relationship with Mega is excellent in terms of our construction, engineering, and our work with clients, and it continues to recommend our work. Baytak Dala is not a low-price company; our work is expensive because providing quality requires money. For example, we do not hire people just for one project like certain players in our industry.

How can Baytak Dala access more clients across different lines of work?

Our growth was mainly through word of mouth; in fact, we did not advertise our services for years and only in the last two years we have started to advertise our work through magazines. In terms of growth, we are always seeking bigger clients and larger challenges; for example, we recently held discussions with H&M because it had heard of our work and liked it. In 2018 we intend to open a company in Russia to work with our existing Turkish clients there, such as Koton, FLO, and perhaps DeFacto as well. Those three are our main clients that want to grow in the Russian market. Looking at the local retail market, it has the potential to grow and this will then lead to more retail brands coming here. Geographically speaking, the biggest potential in the future will be in west Kazakhstan, for example in Atyrau or Aktau. They do not have large malls in that region yet. There is only one small mall in each of those centers and the other retailers are street retailers; the potential is there.

What projects does Baytak Dala have in the pipeline for 2018 and what are your main objectives for the coming year?

For the next year we will develop our business in Russia and start our relationship with H&M. H&M has a plan for two new stores in 2018 and is happy to engage us as its main constructor. H&M is new to Kazakhstan; it only has three stores here to date, including in Mega Silk Way in Astana, Mega Mall, and Mega Park in Almaty. We have also been to Istanbul to meet with Collezione, another established brand in Turkey, though it only has two stores in Kazakhstan. It has a new concept that we looked at in Istanbul with a view to doing it in Kazakhstan. We have submitted our proposal and hope to start working with it as it has two more stores planned for 2017 and another four or five planned for 2018 in different cities around Kazakhstan.