Even in cri­sis, DHL Ex­press head sees how made-in-Ukraine prod­ucts can spur re­cov­ery

Kyiv Post - - Business - BY BRIAN BONNER BRI­BON­[email protected] Kyiv Post chief edi­tor Brian Bonner can be reached at bri­bon­[email protected]

For Vadim Si­doruk, the “made-in­Ukraine” coun­try manager of DHL Ex­press Ukraine, life-shap­ing events took place dur­ing his uni­ver­sity years just be­fore the dawn of the Mikhail Gor­bachev era in the Soviet Union.

In 1983, the Lviv na­tive started work­ing as a tourist guide, putting him in close con­tact with hun­dreds of for­eign­ers over the nearly 10 years he held the job. He grew con­fi­dent speak­ing English in front of crowds, trav­el­ing widely (at least around the U.S.S.R.) and learn­ing about the out­side world from con­ver­sa­tions with the vis­i­tors.

Si­doruk said the ex­pe­ri­ence has stayed with him his whole life. In his case, it helped him suc­ceed in his ca­reer at DHL, the global lo­gis­tics and ship­ping gi­ant, which he joined in 1993. Some of those lessons? Con­trary to the hypocrisy of Soviet politi­cians and bosses, he learned that man­agers should com­mu­ni­cate with em­ploy­ees hon­estly and fre­quently, even when mak­ing un­pop­u­lar de­ci­sions.

He prides him­self on a low turnover rate, un­der 10 per­cent an­nu­ally. While he de­scribes the pay as only av­er­age, the wages are 100 per­cent of­fi­cial, trans­par­ent and taxed. He think that em­ploy­ees should be happy at work, since they are spend­ing as much time with their col­leagues as they are with their own fam­i­lies.

“I am in the peo­ple busi­ness,” Si­doruk said. “Ev­ery day has to be the best day.”

Si­doruk’s love of travel and meet­ing peo­ple con­tin­ued af­ter the demise of the Soviet Union in 1991, an event that he con­fesses that he did not see com­ing “up to the last day un­til it col­lapsed.” In­de­pen­dent Ukraine opened new vis­tas for him. So far he’s vis­ited 80 coun­tries, where he in­dulges in his hobby of na­ture photograph­y.

Fast for­ward to to­day’s chal­lenges in his third year as DHL’s coun­try manager. There are plenty of them.

Some 20 per­cent of the DHL Ex­press busi­ness in Ukraine came from the eastern Don­bas be­fore Rus­sia launched its war a year ago. Af­ter the fight­ing started, DHL Ex­press of­fices were looted in Donetsk and nine de­liv­ery vans stolen. The com­pany also shut down its op­er­a­tions in Crimea af­ter the Rus­sian an­nex­a­tion in March 2014.

So does this mean that the ex­press de­liv­ery ser­vice is hurt­ing? Far from it, says Si­doru Si­doruk, whose Ukraine op­er­a­tions are a tiny, but bright, sliver of the glob­al­glob gi­ant’s busi­ness. Deutsche Post DHL Group’s

world­wide rev­enue came in

Vadim Si­dor Si­doruk

Coun­try Mana Manager, DHL Ex­press Na­tion­al­ity: (born in Lviv) Birth: 1962. How to s suc­ceed in Ukra Ukraine: “Pa­tien “Pa­tience and fo­cus fo­cus.”

Ukraini­anUkrain at $60 bil­lion in 2014, some 70 per­cent of Ukraine’s ex­pected gross do­mes­tic prod­uct of $85 bil­lion this year. The com­pany that em­ploys 150,000 peo­ple glob­ally doesn’t give out rev­enue break­downs by coun­try, but “you can hardly find a coun­try where DHL is not suc­cess­ful,” he said of the com­pany with the dis­tinc­tive red-and-yel­low lo­gos.

De­spite war, revo­lu­tion and re­ces­sion, DHL Ex­press Ukraine will “ex­ceed pro­jec­tions” with dou­ble-digit sales growth this year, Si­doruk said. That’s good news for the 350 em­ploy­ees who work from a gi­ant of­fice-ware­house com­plex, for­merly a steel mill, where they share space with Ukraine’s Cus­toms Ser­vice. The 9 Lu­gova St. ad­dress is near Kar­a­van Me­ga­s­tore.

Si­doruk said that Crimea never gen­er­ated a lot of rev­enue. And, while the war has been dis­as­trous for Don­bas busi­ness, he es­ti­mates that the com­pany lost only half of its cus­tomers there. The other half, he said, mi­grated to Lviv, Odesa, Mariupol, Kharkiv and other rel­a­tively un­af­fected cities.

Si­doruk sees one big and op­ti­mistic trend from his perch. “Ex­port is our driver at the mo­ment,” he said.

While hryv­nia de­val­u­a­tion has cut im­ports, as ex­pected, ex­ports are in­creas­ing as do­mes­tic com­pa­nies send out more sam­ples or prod­ucts all over the world in hopes of land­ing new con­tracts. The made-in-Ukraine list is im­pres­sive and in­cludes food­stuffs, fast-mov­ing con­sumer goods and tex­tiles. DHL Ex­press Ukraine sees that ship­ments to all re­gions of the world are up, ex­cept for trade with Rus­sia, which has dropped sharply.

The de­vel­op­ments sug­gest to Si­doruk that Ukraine’s path to a brighter econ­omy is through greater ex­ports. He says he’s “amazed by the qual­ity” of Ukrainian-made goods, not just the prod­ucts but also the pack­ag­ing, which Si­doruk says has im­proved greatly in re­cent years.

He’s seen progress in his 22 years with the com­pany in other ar­eas as well.

Up un­til a few years ago, Ukraine’s Cus­toms Ser­vice held up de­liv­er­ies of even small packages with items worth less than 150 eu­ros. “Ev­ery­thing that came into the coun­try was stopped,” he said with amaze­ment. No longer. But those changes, along with “try­ing to make things hap­pen with­out bribes,” took years of lob­by­ing gov­ern­ment of­fi­cials at var­i­ous lev­els, he said.

While he doesn’t like talk­ing about com­peti­tors TNT, Meest, United Par­cel Ser­vice and Fed­eral Ex­press, Si­doruk touts DHL Ex­press Ukraine’s 65 per­cent mar­ket share -- prac­ti­cally a mo­nop­oly, al­beit one with the other big names still do­ing busi­ness.

Not sur­pris­ingly, DHL Ex­press is highly au­to­mated, mod­ern and runs like clock­work: A Boe­ing 737 or Boe­ing 757 jet flies up to 15 tons of cargo into the coun­try at 9 a.m., mainly from Leipzig, Ger­many. The same plane takes out­bound ship­ments at 9 p.m. Ship­ments in Ukraine are pro­cessed at the Kyiv ware­house for lo­cal de­liv­ery about 2 p.m., which is the same time that cus­tomers need to drop off their packages to en­sure that they will make the evening flight. DHL Ex­press has 35 ser­vice cen­ters through­out the na­tion and a fleet of more than 100 ve­hi­cles.

Aside from the busi­ness he runs, Si­doruk be­lieves that his home­land is “just break­ing away from the Soviet Union and Soviet men­tal­ity,” a prospect he wel­comes. But the na­tion can’t do it alone. “The West has to help Ukraine,” he said. “Fi­nan­cial help is im­por­tant and also with the know-how. For me what is con­nected to the West is not just fi­nan­cial, it’s a set of val­ues that are close to Ukraine.”

(Pavlo Po­d­u­falov) Ti­tle:

DHL Ex­press Ukraine work­ers sort packages in the com­pany’s Kyiv head­quar­ters on March 17. De­spite Ukraine’s re­ces­sion and war, the di­vi­sion ex­pects to have dou­ble-digit growth in rev­enue, although the global lo­gis­tics and ship­ping gi­ant doesn’t...

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