Vera Vitynska, Eldorado.ua: The main conclusion of 2022 is the value of partnerships

The CEO of the company Eldorado.ua about the losses of the network during the war, changes in sales in various segments of technology and electronics, and priority areas of work. During the year of the war, the chain of Eldorado.ua stores decreased by 34 outlets. Despite the losses, the retailer continues to withstand difficult business conditions, fakes in the network and is actively developing.

How the company survived 2022 and what it is working on further, in an interview with RAU, Eldorado.ua CEO Vera Vitynska told.

– How did Eldorado.ua go military 2022? What are the main conclusions?

– Like many Ukrainian companies, we have significant losses in fixed assets, commodity balances that were in destroyed stores, or those over which we lost control. Warehouses were also damaged, and vehicles were lost. Losses are estimated at hundreds of millions of hryvnias. However, the first thing we did when we returned to work in March was to process the requests of the Defense Forces. Our assistance in technology and electronics, including the participation of specialized funds, is more than 10 million UAH. In the early days, we took care of our people: we helped them to relax and provided organizational, moral, and material support. Targeted assistance amounted to 2 million UAH. We didn’t cut anyone. More than 3,000 employees are our main asset for restoration and rebuilding. Our 176 employees who protect the country continue to receive regular assistance from the company. In addition, we provide support after injury. The total amount of such assistance is more than 10 million UAH. All these are indispensable decisions that every responsible Ukrainian business makes to support the country and win.

– What has this year taught you?

– One of the more satisfying takeaways this year is the value of partnerships. I am grateful to all partners who, despite the difficulties faced by the entire market, find common solutions to continue cooperation and resume work. And I am sure that after such difficult joint tests, our relations will only get stronger. Market contraction, inflation, and rising prices, loss of assets, the complete restructuring of logistics, the possibility of only short-term planning are the new realities of wartime, with which we have learned to work since February 2022. – How many stores are online now? How many are closed and destroyed? – As a result of hostilities, one of the central warehouses was destroyed, and assets in stores in Mariupol, Kherson, Bucha, Melitopol, Irpin, Novaya Kakhovka, Kharkiv, Berdyansk, Brovary, and Kyiv were damaged. The chain was reduced from 129 stores before the war to 95. 6 stores were destroyed, 3 – were under temporary occupation, 25 – closed or frozen due to changes in consumer demand, reduced traffic, forced migration, and for reasons of reducing the cost of maintaining retail premises, logistics, and ready-to-work staff.

– Have there been any store openings during the year?

– After February 24, three new stores were opened: in Chernivtsi, Bila Tserkva, and Chervonograd. In addition, as planned before the war, the format of the store in Uman was updated. In June-July, as soon as possible, the shops in Bucha and Irpyn were repaired and returned. In January 2023, the first among large retailers, Eldorado.ua reopened the store with an area of more than 1000. square meters in the Kyiv shopping center Retroville, which was destroyed during shelling in March. As soon as the security situation allows, we will return to Kherson and other liberated cities. Now residents of these cities can buy via the Internet, including through an updated mobile application, and receive orders by mail. We are considering opening stores in the central, northern, southern, and western regions, but much will depend on the state of the economy and the recovery of consumer demand.

– How to solve logistical problems?

– Realities of wartime: broken and broken supply chains, changes in foreign trade routes, a sharp and rapid change in warehouse conditions, difficulties with the purchase of goods, complications of logistics operations, and rising prices for carrier services. Blocking Ukrainian ports and loading on European ones significantly influenced the delivery time and, especially, its cost. Our warehouse in Brovary district was damaged in March, and we urgently transported the remaining goods to the west to new warehouses that were opened in Ternopil, Lviv, and Ivano-Frankivsk. In July, a new built-to-suit warehouse was opened in Brovary with an area of 24,000 square meters. m, with the highest standard of quality and energy efficiency. Optimal geographical location allows you to ensure regular deliveries of goods to the stores of the network. We reduced the warehouse space in the west but did not completely abandon them to be able to decentralize supplies and refrain from accumulating goods in one warehouse.

Restored store in Retroville shopping center

– How did you adapt to the situation with the electricity supply?

– 60% of the Eldorado.ua chain stores are energy independent, and some have become “indestructible points” for our customers. By the way, we will soon start implementing the Starlink RV version, which works regardless of the installation location and has the ability to pay only for the time of use.

– How much have sales in different segments of technology and electronics changed due to the war? How have consumer demand and consumer behavior changed?

– The market for consumer technology and electronics in 2022 has declined significantly. According to various estimates – by 35-40% in quantity and 20-25% in monetary terms. And the forced migration of the economically active part of the population, the decline in consumer demand, the restructuring of logistics, inflation, and the suspension and change of supply conditions – all had an impact. Like colleagues in the market, there were spikes in demand caused by the current needs of Ukrainians. So, in the first months of the war, we fulfilled many requests for equipment and electronics for the military. For Ukrainians who moved, it was important to stay in touch with their relatives and continue to work remotely, so the demand for phones and laptops, as well as small household appliances, increased. In the summer there was a surge in demand for heating equipment, and in October sales of chargers and generators increased 17 times, now this interest is already subsiding

– How was the “high season” of sales for the company?

– The traditional “high season” in 2022 was very moderate. Of course, Ukrainians bought gifts for their loved ones and took the opportunity to buy equipment for themselves with discounts for Black Friday. However, both the average bill and sales volumes were significantly lower than those in peacetime, including due to shelling and blackouts. Although we provided the opportunity to buy in the absence of electricity in almost all stores and online. A separate new category of buyers is now the military, for them, we provide a discount of 5-10%, and for eight months of the action they purchased almost 40,000 gadgets, the total discount is almost 16 million UAH. In general, demand is gradually returning. Resilience is the main thing that we must learn from this war, life goes on, if it were not difficult.

– Tell us about social initiatives Eldorado.ua.

– In addition to what I mentioned above, we have a separate project aimed at helping families. In September 2022, they launched the Brick for a Mole initiative. Our customers in stores or online will donate “bricks” for 23 UAH for the construction of modular housing for families who have lost it. The keys to the first modular house, half of the cost of which was paid by Eldorado.ua, have already been transferred to the family of a serviceman from the Chernihiv region. Clients continue to donate and soon the construction of a new house for another family will begin. The project continues.

– What will the marketing of the company in 2023 focus on? Has creative competition returned to the market?

– We take care of families, providing all the necessary equipment, leaving time for the important – this is our mission, which is realized in each of our actions and passes the test of time and war. So, for the New Year holidays, to support Ukrainian families, we made an inspiring video about care, love, and intimacy even in this difficult time. Among market participants, there is an increase in competition for the consumer. Hence – the high role of the service, various shopping scenarios, providing remote sales channels, creating eco-systems of care for the consumer, the life of him and the whole family – 360 degrees. I will also add the second part of the question. Unfortunately, we have the facts of the appearance of non-random publications, which our company is again associated with the aggressor country. Of course, this is a sensitive topic now. Although it has long been known that we are a Ukrainian company, we give work to Ukrainians, and pay taxes in Ukraine and the relevant information is contained in open sources. Instead, completely unproven compromising info is selectively compiled. Whether this is in the interests of competitors or other detractors – we find out.

– What are Eldorado.ua ‘s priorities and plans for 2023?

– In 2023, we will continue to develop in all directions: shops, online, mobile applications, strengthening of service, lending, and delivery opportunities. Already this year, we will add solutions to the mobile application that will be the beginning of the introduction of a new quality of care for the consumer, taking into account all its main needs, and ensuring their “seamless” satisfaction. We focus on digitalization: to speed up processes, control them, and optimize costs. In 2022, there were many changes in the processes, which made it possible to simplify the everyday life of both employees and buyers: we added a chat on the site with the operator, developed new sales scenarios, and introduced new standards of services and a whole eco-system for consumers. We have a pretty good NPS, but we still have a lot of good ideas.

– We are all waiting for victory. Do you have plans after it?

– We all passionately want an early victory. At the same time, let us be realistic: rebuilding and rebuilding will not be quick. Therefore, “if you want peace, be ready for war,” let’s expect the best, but prepare for complex scenarios. Our people are all war-weary, so brands can support them in ways like shopping comfort and quality of service. Companies in Ukraine before the war were quite a service, and now impeccable attention and care will become an unconditional trend. Business knows how to develop, create jobs, pay salaries, expand the range of goods and services, and help their people and army. All this will be the main task next to the restoration of housing, and modernization of energy and infrastructure. Our company will definitely continue to take care of Ukrainian families, providing their needs in technology and electronics. We will develop the CSR direction separately, for this purpose we created the Charitable Foundation “For the Sake of Families.” There will be a lot of work, but I know one thing for sure: Ukraine after the victory will be a renewed country of free people. This is a great achievement and a great responsibility to rebuild and change the country so that all the efforts made for this were not in vain.