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What were the biggest successes and projects for Atropatena in 2014?

Atropatena is both a distribution and, over the last 7 years, an investment company. We started 3 projects in 2014, which are ongoing. We are setting up a dairy plant, a 3,000-head cattle station to ensure supplies of quality meat for the company’s meat processing plant, and Fresco retail project. We are expanding in terms of our product range as well. One of the major highlights of 2014 was the contract that Atropatena signed with Danone. We will be producing Danone’s products at our facilities. In a way, we are pioneers in producing global brands for Azerbaijan’s market. 2014 was also the Year of Industry in Azerbaijan. The Ministry of Economy and Industry awarded us with a prize for our implementation of high technology and innovations in the agriculture sector.

At the moment, what is the balance between the distribution and production side of your company?

Any business starts with sales, and we are quite experienced in that area. We partner with about 10 TNCs, including Danone, Kimberly-Clark, Nestle, GlaxoSmithKline, Henkel, Schwarzkopf, and others. Once the market is deep enough, we start production. That is the case in each and every market segment we are operating in. At Atropatena we always consider the potential of each product.

What is the potential for manufacturing elements to increase?

We are in the early stages of our manufacturing business, as it has only been four years. The market is quite young and is still developing. For example, the share of the dairy products produced industrially is quite insignificant, and so there is great potential for it. On top of that, we are studying export options. We consider Russia, Kazakhstan, and Georgia, as well as some Arab countries as key potential markets. There are quite a few successful examples of Turkish dairy producers exporting their goods to Arab countries. Thus, we have prepared for further expansion and obtained various international quality certificates such as the ISO-22000 and BRC Global Standards. In 2014, we gained special Danone food safety certificates. The company’s laboratory has also obtained international accreditation. Now, we are expanding our resource network to ensure the consistency of supply and to launch exports to neighboring countries.

In terms of revenues for the future, how important are the investments to the dairy factory and cattle farm?

Azerbaijan is encouraging the development of the non-oil economy. One of the alternatives is agriculture—the sector enjoys government support and has a great potential for growth. Development of agriculture is essential for replacing imports, and we are actively contributing to that with our distribution network and marketing support.

With 2015 being the Year of Agriculture, in what way can Atropatena have an impact on the success of the sector?

Naming 2015 the Year of Agriculture was not random as there is a great potential in this area. Atropatena runs the largest dairy plant in the country with a capacity of 250 tons of milk, which is a significant amount for Azerbaijan. On top of that, we have a large cattle farm. We have two major areas to develop. The first is creating feed supplies for the cattle, which is most likely to be our focus this year. The second area is developing small farms. Atropatena will transfer its knowledge and quality standards to small (30-100 head of cattle) Azerbaijani farms. It will allow us to manufacture high-quality products in line with our standards. Focusing on feed supplies, we are trying to get a plot of land and are preparing a project that will allow us to grow all the necessary feed supplies. It will, in turn, increase the capacities of production and reduce the costs of the dairy products. The average amount of milk a cow produces daily is 28 liters, and we aim to increase that to 33-35 liters. The leading producers in terms of efficiency are Israel (12 tons of milk per cow a year) and the USA (9-9.5 tons per year), the European average is 7 tons. Atropatena is between Europe and the US in terms of efficiency.

The first European Games are coming up. In which ways can the games benefit Atropatena?

It is a milestone event for the country, and we are all getting ready for it. Atropatena is launching a number of products dedicated to the Games. On the other hand, we are a distribution company and will provide distribution support. It is a mutually beneficial partnership.

What are your main expectations and targets for 2015?

It will not be an easy year, and we have been preparing for it. It will be necessary to be more productive this year. The devaluation is affecting purchasing power; however, it is also creating opportunities in the domestic market, as well as for exports. The cheaper the manat is, the cheaper our products are. Our goal is to grow in double digits and to maintain our leading position. Over the past few years, the manat was stable and we all got used to that. In 2014, we felt that the manat was overvalued and it was hard to develop our exports. It was quite noticeable when compared to other currencies, such as Georgian lari, Turkish lira, and Russian ruble. Thus, their exports were cheaper, and it was hard for us to compete with them.