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Estonian logistics firm expands to Mexico

Estonia’s leading maritime agency CF&S Estonia has found customers in Mexico and has begun offering logistics services to transport goods from Mexico to Columbia and the Dominican Republic.

The logistics firm found new customers at the official visit by Estonia’s foreign ministry to Mexico in May, where business leaders were co-invited. The company’s managing director Harri Rästas said that he had no high hopes for Mexico at first since he knew that the country’s economy is mostly tied to the U.S. The actual results are above the company’s expectations since CF&S Estonia has already managed to start doing business in Mexico after just one meeting.

Rästas said that doing business in Mexico is different from Europe, but the fact that Mexico is the nineth biggest economy in the world is a sign that Mexican businessmen are not resting on their laurels. Speaking about cultural differences, Rästas said that one has to be ready for meetings to be cancelled at the last moment. However, finding a mutual language at the meeting was easy, he added.

CF&S, one of the largest Estonian-capital based logistics and forwarding companies, had the most successful financial year in history in 2012. Established in 1997, the company managed to grow its turnover by 65%, hitting 55 million euros. The company provides a broad spectrum of logistic services from road, sea, railway and air transport to warehouse and customs services. The Tallinn-headquartered firm employs a total of 140 people and has subsidiaries also in Latvia, Russia and Kazakhstan.

Estonia’s foreign minister, Urmas Paet, said that Estonian IT companies (Regio, for example, offering GPS solutions) also have good experiences doing business in Mexico. There are also talks to export other innovative e-solutions to Mexico, such as e-health development. "We are ready to share our experience with Mexico and to introduce our solutions in other fields," he added.

Source: Ladõnskaja, V. (2013) Logistikafirma alustas koostööd Mehhiko ettevõtjatega. Äripäev, 28. mai.

How to enter a retail chain in Sweden?

Time : May 30th, 8:45

Place: Restaurant CRU, Viru 8, Tallinn

Exporting food to foreign countries has never been a simple task. Shops and wholesalers often have well-established contacts with local producers who provide fresh products on a regular basis. How to change this? How to enter foreign retail chain?

Experience on how to establish fruitful cooperation with Swedish partners and enter a retail chain will share Mats Hvalgren - central sourcing director at ICA Baltic branch – Rimi Baltic and Avo Kaasik, general manager of Hallik AS.

Following topics will be included in the discussion:

- What are the requirements to become a supplier for a retail chain in Sweden? Sourcing model of ICA

- What adjustments one should make in order to expand successfully in Sweden?

- Challenges to enter Scandinavian Market

- Importance of constant product development

- Exporting to Sweden is a long-term project


08:50 - 09:00 Arrival and Morning coffee

09:00 - 09:20 Getting to know each other

09:20 - 10:00 Presentation held by Mats Hvalgren (in English)

10:00 – 10:20 Networking

10:20 – 11:20 Presentation held by Avo Kaasik (in English)

11:20 – 12:00 Discussion, questions and answers

Fee: 10EUR +VAT

Free of charge for DNB and GatewayBaltic clients.
Register: ej.uz/Ekspordihommik
Info: This email address is being protected from spambots. You need JavaScript enabled to view it.

*Mats Hvalgren

ICA Group, former Central Sourcing Director of Rimi Baltic
Mats was working in one of the ICA’s branches – Rimi Baltic. He is engaged in establishing and sustaining good relationship between Baltic and Swedish businesses, and is responsible for sourcing processes across Baltics.

*Avo Kaasik

Hallik AS, Chairman of the Supervisory Board
AS Hallik manufactures bakery products under the brand name Hagar and is the 5th biggest manufacturer of bakery products in Estonia. Today the product range includes more than 80 different products. Company is operating in Finnish and Swedish markets.

Export to Russia boosts furniture producers’ turnover

Estonia’s furniture producers had a year of ups and downs — those active in the Russian and German markets were successful, while those selling to domestic and Scandinavian markets were not so well-off.

One of the flagships of the sector, Standard, increased its exports by 86% in 2012, compared to the year before. The hotel and office furniture producer had a turnover of 12 million euros last year with export markets including Europe to Western Africa. Low demand in the office furniture market was partly compensated by sales of kitchen furniture and hotel furniture. Despite its company name, Standard, 75% of its production is non-standard and most of its clients are 4- and 5-star hotels.

Soft furniture producer, Bellus Furniture, had a stable year. Sales to Europe decreased, but turnover grew in selling sofas to Russia. Rolf Relander from the company’s management said that the Russian market moves in a different rhythm compared to the rest of Europe, as the EU’s economy does not have much impact on them.

The total turnover of companies in the Furniture Producers Association was 165 million euros in 2012, stable from the year before. Ain Tats, head of the Association, said that Estonian furniture producers have been able to establish successful contacts in Russia which has boosted sales to substantially.

Source: Stadnik, A. (2013) Mööblitootjate ameerikamäed. Äripäev, 10. aprill.

Baltic business leaders optimistic about future, study says

Baltic business leaders see signs of security in the outlook of Estonia’s, Latvia’s and Lithuania’s economies, reveals the recent survey by KPMG auditors.

Leaders have faith that the 2–4% economic growth will continue, and they have plans to increase salaries and personnel. “80% of Estonia’s leaders think that economic growth in all three countries will remain between 2–4 %,” CEO of KPMG Baltics, Andris Jegers, said.

The confidence of Estonia’s business leaders has risen during the last three years. This year, 76% of Estonia’s entrepreneurs estimate a salary increase and 32% have plans to raise their employees’ salaries by more than 5%.

Estonia’s corporate taxation model, where earning profits in itself does not bring income tax liability, seems to be popular in all three countries, the study said. However, if earned profits are distributed to shareholders, the company has to pay a 21% rate in Estonia, compared to a flat corporate tax rate of 15% in Latvia and Lithuania. It seems that there are some misunderstandings about the Estonian model in other Baltic countries; for example, in Latvia it is thought that there is no corporate income tax in Estonia, KPMG said.

Source: (2013) KPMG uuring: Balti äriliidrid tuleviku suhtes julgemad. Delfi Majandus, 8. aprill.

Estonian trade turnover down in February

Estonia’s export was down by 2% and import by 3% in February, on an annual basis. The fall in trade turnover was due to a substantial decrease in the trade of mineral fuels, the Statistics Estonia office said.

Machinery and equipment had the highest share or 30% of total exports, followed by mineral fuel (13%) and agricultural and food products (10%). Mineral fuel outflow (gas, shale oil and electrical energy) was down by 37%. Out of all imports, 27% were machinery and equipment, down by 34% annually.

The top export target country was Sweden (18% of all exports), followed by Finland (15%) and Russia (11%). Electrical equipment, wood and wood products plus furniture were the most exported goods to Sweden and Finland. Mostly machinery and equipment as well as plastic products were sent to Russia.

Compared to January 2013, exports were down by 15% and imports by 7%.

Source: Linkgreim, I-G. (2013) Eksport vähenes veebruaris aastaga 2%, import 3%. ERR Uudised, 9. aprill