Rustam Minnikhanov: ‘I am ready to answer questions for 1-1,5 hours every day’
The Tatarstan president has launched anti-crisis online conferences for businesses
Businesses have turned out on the edge of a catastrophe during the total self-isolation because of the coronavirus and the ban on activity. To support entrepreneurs during this uneasy period, the president of Tatarstan has launched online conferences where specialists are ready to consult SMEs. A meeting named Adaptation Technologies: How to Survive and Grow? on 1 April gathered over 3,000 viewers, not to mention the huge audience of spectators with Realnoe Vremya’s correspondents among them. Directors of big companies Tatiana Bakalchuk (Wildberries) and Sergey Akulchev (Akulchev) as well as specialists in hospitality, legal and financial affairs were the speakers. A total of over 20 experts explained how to act during a crisis and save their business in stages.
“You’re not alone”
The Ministry of Economy of Tatarstan together with the Entrepreneurship Support Fund of the Republic of Tatarstan and Entrepreneurship Factory project has launched a series of anti-crisis online conferences on President of the republic Rustam Minnikhanov’s instruction. There has already been a webinar for public catering this week. The second one about technologies of adaptation to the current conditions began with a series of videos where entrepreneurs shared their problems and fears: “The production has closed”, “We have to give about 10 million back for the tours sold”, “We’ve sent 80% of employees home”, “We’re writing letters to the lessor asking him to cut the rental”, “We aren’t protected, we have become a buffer zone between tourists and operators, we are receiving threats”.
Others explained what steps they took in this complicated situation:
“We’re adding new products: online courses, marathons, online consultation, improve online advertising”, “We’ve begun making multi-use masks”, “We’re transferring some staff to telecommuting, we are refusing the office, we will be developing new areas”.
“The times are tough today, all supporting measures must be provided. And you should mobilise, the authorities will listen to you, react to your requests. We are working every day, this is why we will find a way for entrepreneurs to ask questions if needed. I am ready to answer questions for 1-1,5 hours a day. We will stay together,” Tatarstan President Rustam Minnikhanov addressed businesses.
“Black Swan, this is how unpredicted events in social and economic life with significant consequences are called. Apart from the coronavirus pandemic, there have been one of the lowest oil prices now since 1999. Experts are waiting for about a 2% recession in the economy, and this is an optimistic version. The Tatarstan president’s initiative is helping to lift the information blockade, understand an entrepreneur he or she isn’t alone, give power and tools for the future,” continued moderator, Board Chairman of Bulatov Group GC and founder of Entrepreneurship Factory project Bulat Ganiyev.
As an example, there were put situations when businesses created new successful products and ventures amid a crisis. LEGO company went up during the American depression. Famous Pepsi is also among them.
Self-employed people will appear in all regions
Director of the Department of Investment Policy and Entrepreneurship Development of the Russian Ministry of Economic Development Milena Arslanova told them about business supporting measures at state level. She also said that micro-enterprises were allowed to get closed to excise goods. Small enterprises will be able to take out a loan for a product.
Despite outstanding debts, banks are obliged to accept loan applications from entrepreneurs, moreover, current debts must be refinanced.
“Go to banks, your credit story will be reconsidered to reduce the rate. All these measures are being considered, we are waiting for approval these days.” A programme on concessionary rates of microloans will be launched soon. The Central Bank has extended the programme to stimulate lending and reduced the rate to 8,5% so that commercial banks wouldn’t raise current rates.
Arslanova urged entrepreneurs to go to the centre My Business where supporting measures are accumulated. It is also telecommuting.
“What has happened around the world overnight? New cases in the USA have reached a record high. Trump’s mood is alarming, he said that they were entering a tunnel, and the end wasn’t seen so far. It seems that Italy has passed its peak. Germany has accelerated a bit, France has unexpectedly added up 14%, Great Britain has 14% too. Japan, Sweden don’t have any catastrophe, we’re keeping an eye for their experience. Russia has had 27% more. Doctors’ infection, yesterday’s case, is the most alarming thing. We should take measures to train doctors as much as possible,” the Russian State Duma’s deputy Ayrat Farrakhov described the current state of affairs.
He explained what decisions the parliament made to prevent the coronavirus from spreading and enumerated supporting measures for entrepreneurs:
“The State Duma adopted eight laws, and the Federation Council immediately approved them yesterday. It is the enhancement of criminal and administrative liability, a big set was adopted that will allow transferring payments to the Russian regions. There is a big package for SMEs in tax legislation on three pages, including about unlimited insurance premiums — about 350 billion rubles nowadays. Laws regarding the Bank of Russia’s activity have changed: mortgage extension and extension of the right to consider a holiday for a business. Today all Russian regions have had the right to turn the regime of self-employment on. There is an important issue about the support for agrarians with seeds. We can create requests directly and answer entrepreneurs’ questions.”
“Many travel agencies will die”
A survey via teleconference showed that only 8% of companies kept working steadily, the rest of the enterprises were experiencing either catastrophic problems or a fall in their business; 19% of entrepreneurs replied they had had a wait-and-see attitude, 20% were waiting for help, 11% were expanding capacities, 50% were actively cutting expenses. The experts of the conference noted that in any case, Russians were in a more favourable situation. They can have a look at tomorrow as if they had a time machine and see how events in other countries are developing to take necessary measures in advance to reduce risks in both incidence and economy.
“30% of clients are agreeing on interest deferment, the rest is asking for a return. Companies can’t return most of the money. Companies will simply die if the quarantine lasts for 3-4 months. Companies have a chance of survival if the quarantine lasts for 1-2 months. Many travel agencies can’t return even the advance payment,” stated Director of Alyona LLC (tour operator in domestic, inbound tourism, children's tourism) Yelena Ilkun.
Commercial Director of Kazan Riviera Hotel and Entertainment Complex Yelena Voitko told us that 2-4 rooms were occupied in the hotel, entertainment areas weren’t functioning amid the unusually empty foyer of the complex. Somebody out of a thousand employees had to be laid off, somebody had to have a furlough or paid holidays.
“We have returned our clients’ money, we have cancelled a lot of weddings and conferences. People almost don’t have a stock of money in our country to live for more than a month. I think the sector can’t endure for longer than a month, then companies will go bankrupt and ruin. It will be very sad to lose all the effort we have invested to develop tourism in Tatarstan in the last 10 years. We hope for support when it comes to taxes like it other countries where the support is significant.”
Cattle breeders are fine, but there can be problems with seeds
Farmer Albert Smirnov from Mendeleyevsk District has a family farm — 100 hectares of land for cultivation and 600 head of cattle that are fattening. He has had to stop construction because sites with materials are closed. But the farm keeps working, the closure of car traffic hasn’t influenced the household. Neither does he have problems with diesel fuel and supplies of spare parts — the enterprise has agreements signed with companies. Albert Smirnov is concerned about the closure of an agricultural R&D centre in Ulyanovsk Oblast. Farmers won’t be able to take original seeds. For this reason, seed farms that prepare seeds for ordinary enterprises can be hit next year.
Chairwoman of the Agrarian Youth Association of the Republic of Tatarstan Dilyara Shuvalova has begun supplying green across Russia. Her company works with organisations that plant seeds on sale, for individual orders. Demand for products has gone up four times overnight. The head of the company is considering how to expand supplies.
To stop feeling nostalgia but charge with positivity
“It has been a roller coaster. We should forget what was yesterday, stop feeling nostalgia, immediately change views. Those will save money for a company’s living, solutions are individual everywhere,” Director General of Akulchev Sergey Akulchev believes.
His company has cut expenses as much as possible, suspended a construction. By accumulating a financial backstop, he is spending all the money on feedstock and buying ready-to-use products for a long term, he is selling products, first of all, to those who are paying right away. The staff of salespeople, selling channels, the number of shelves in every city have increased. “During a 10-minute briefing in the enterprise, we explained what was going on in the company, what’s happening to sales. After these briefings people understand what is awaiting them tomorrow, communication is as important today as never”.
“Banks must be on the list of enterprises that can operate at a distance. Telecommuting creates difficulties with bank resources. Establish communication of bodies of authorities with the population, slow down the speed of decision-making and give people at least a day or two to think of the decisions. Nervousness on roads must be excluded. Transport with food must be let go without obstacles. Every region has standard-issue passes. Problems arise when going to another region: the seal is wrong, the design isn’t correct. There is extortion. Unified passes for all Russia are needed,” Sergey Akulchev addresses bodies of authorities.
“It is necessary to keep our composure, think and talk positively. People are cheered by it. Cheer them by positivity, then life will be easier,” Akulchev urged his colleagues.
Lively trade isn’t eternal
Director of Ozon in Tatarstan and Volga region Rustem Kasimov share that during the high demand for goods via the Internet, the retailer is developing the service of delivery by reinforcing security measures.
Director General of Wildberries Tatiana Bakalchuk said about 100% growth of goods purchased online. The company has simplified the sign-up, which takes just 5 minutes, and one can go shopping. If an entrepreneur doesn’t have an electronic digital signature, the retailer will help to create it, the sign-up will stretch into two days. The company carries all costs and grants loans to suppliers.
Wildberries will hold webinars in Tatarstan for suppliers and self-employed people. “We will teach entrepreneurs in affected sectors how to digitalise their services and sell goods online,” Bakalchuk noted.
Founder of Get Out of Room quest project Artyom Kramin whose locations in Italy, Spain, Great Britain and the USA closed, has dived into problems because of the restrictions as early as 2 months ago. He warned that lively trade wouldn’t last forever. People will start to economising soon. Kramin noted that the government in Great Britain was promising to cover 80% of costs to pay salaries to workers in the companies. But the mechanisms aren’t well-oiled yet: “where to go, what documents are needed — this is absent. Lessors don’t want to lose a normal lessee, at the moment they aren’t replying to my letters, it seems they are getting ready to discuss issues”.
Retrain during crisis
Managing partner of Zarubin and Partners juridical company Filipp Zarubin advised entrepreneurs to use the website of the authorised body of the Russian region on your territory. It has documents about business supporting measures.
“The lessor shouldn’t be offering zero rental holidays, one can be linked with interest on income. If an agreement isn’t reached, invite professionals who can consider the conflict as an outsider. If neither this helps, only the court is the solution,” Zarubin recommended. He advised going to the website Law.ru that has a full plan of actions, what to do with employees during the quarantine.”
Director of Special Projects Department at HeadHunter Vitaly Terentyev provided statistics: about 64% of job seekers in the Russian labour market claimed they kept working, 1% said the management sent them home with pay, 8% were sent without pay, 7% were laid off, companies of 3% of the respondents went bankrupt.
“To keep the staff, HeadHunter will help employers to employ people in other, more popular spheres as drivers, couriers, warehouse workers. There isn’t a global fall in vacancies. There are 563,000 vacant jobs across the country, each of them requires more than one person,” Terentyev explained.
Goal isn’t to make money but survive
Financiers have predicted a crisis in the last two years. Warren Buffet withdrew $120 billion from assets six months to the crisis. He probably drew up an anti-crisis plan, said consultant in business systems and finance Mikhail Nosov. He thinks that “we have 60-100 days to reach the bottom and go upward”. It is the time when one can establish trusting relations with one’s clients. The goal during this period isn’t to make money but have a turnover and survive.
“Unemployment in the USA is over 20%. The situation is just starting to develop. The good news for us is that Russians are one of the peoples that constantly lives in a state of crisis, our subconscious immunity of survival is high,” Mikhail Fyodorenko, candidate for economic sciences, an adviser to the head of the Russian Federal Anti-Monopoly Service, expert in public administration, optimistically noted.
He warned that a wave of fraud was awaiting Russia. Many companies now are doing they didn’t have time for earlier: they are conducting audits, inspections, detect where there is a surplus, and where there is a lack of effectiveness. In Fyodorenko’s opinion, reforms are awaiting public administration and businesses. A crisis is a period for “for personal enhancement, improvement of physical and mental health”.