WOLF TALES Club News
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Anniversary Special
UE: S S I S I H IN T E 20 T L E M I KR ROM F S N O I ECT RECOLL EES AND EMPLOY RS PARTNE MUUD! -PALJU
JA PALJU
Our magazine is printed on recycled paper ♻
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PRODUCT BRANDS
OVER
50
EXPORT MARKETS
BRAZIL
OLIVÉ QUÍMICA S.A. SPAIN & FRANCE
KRIMELTE ESTONIA
PRODUCERS
KRIMELTE
7
PRODUCTION COMPANIES
RUSSIA
ELASTEQ DO BRASIL LTDA.
ELASTRA CHEMICALS ESTONIA
KRIMELTE TEMPSI ESTONIA
BRAZIL
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RUSSIA
ESTONIA UK
LITHUANIA
LATVIA
UKRAINE FRANCE
ROMANIA BULGARIA
PORTUGAL
SPAIN
OVER
350 EMPLOYEES
OLIVÉ QUÍMICA S.A. SPAIN,FRANCE, PORTUGAL & UK
PENOSIL EESTI
KRIMELTE LATVIA
ESTONIA
LATVIA
DISTRIBUTERS
KRIMELTE LT LITHUANIA
KRIMELTE BULGARIA
KRIMELTE UKRAINA
BULGARIA
UKRAINE
PENOSIL ROMANIA
12
SALES COMPANIES
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1994
SEPTEMBER 30 OÜ KRIMELTE IS REGISTERED – A GIANT PRODUCER CREATED FROM NOTHING irst there was nothing. There were only two university graduates - Jaan Puusaag and Jaanus Paeväli. It was their hard work that made a successful recognized company out of nothing. Previous failures as a salesman in Paekivitoodete Tehas, Mateki and Parmek had scared Jaan. "I had been told I was not up to my job," he describes the reasons behind the job change to the Director magazine, admitting at the same time that he probably was a bit of a smart-ass as well who always had a loud opinion about everything.
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KRIMELTE WAS ESTABLISHED IN THE BASEMENT OF THIS HOUSE 20 YEARS AGO
KRIMELTE'S OLD LOGO
This disappointment actually helped me to realize that I was an entrepreneur at heart.” So, in 1994, he created a business with Jaanus Paeväli, 51% of which is still in their ownership. Jaan was 25 then and Jaanus 23. It was a classic beginning. People with a similar work background decided: we can do the same on our own, or even better. "As a paid employee, you can make tremendous effort, but only earn 500 kroons more than before," Jaan adds, when talking about the birth of the company to Ärileht (Estonian business newspaper). The company’s birth date in the business registry is September 30, 1994. That day, Ärileht’s lead story was about the sinking of the cruise ship Estonia and about the future of the Estonian shipping industry. Some space was also spared for the scandal of the Innovation Bank and for the Latvian business man captured in Sweden. “We started out empty handed, so Jaanus and I have been joking that if at one point we’ll go back to having nothing, at least we haven’t lost anything,” Jaan reminisces about the begin-
ning of the company in an on-line interview on ehitusuudised.ee. Jaanus shares with Wolf Tales, “I was at my parents’ house in Kohtla-Järve and speaking on the phone in Russian about pistolets, sea containers and Russia and my father happened to overhear, so a few minutes after the call, he came up to me and, very worried, started warning me about the dangers of such business. It took me at least a quarter of an hour to explain to them that I was speaking about gun foams, because they didn’t really seem to understand what their son was involved in. "We started out as a distributor and took advantage of the contradictory feelings of fear and temptation that Western companies had towards making business with Russia. We bought in construction foams from a Danish company Baxender Scandinavia and sold it to Russia," Jaan describes. The first sea container from Denmark set off to Russia in 1995. "It was really stormy and I myself was running from one toll booth to another. But we already made a profit with the first container," Jaan remarks and adds that they had to hand load the container to a truck taking it to Russia. To make the most of container space, it had been loaded manually, using no pallets and filling it up from top to bottom. “Container day” meant rolling up the sleeves and spending two hours loading foams in the customs warehouse. “Back then, we used to load like two containers per week,” Jaan accounts, amused. In 1995, they leased the company’s first cell phone that cost 16 000 kroons. It was a Nokia NMT mobile phone with a long tail. A phone
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number where foreign customers could easily reach them had become essential.
and water-resistance became important,” Jaan relates.
came a client and it felt great. That's how.”
CONQUERING THE WORLD TOGETHER
Jaanus adds that the product concept itself was something entirely new and he had to go driving around former Soviet Republics looking for customers: "There was a period in my life where I was simply travelling around and explaining our business in Kazakhstan, Kiev, Moscow, St. Petersburg, Novosibirsk and Kishinev.” Jaanus says that they are often asked how they found their customers, but the answer is very simple: they worked for it. “I remember that one night we just took the Belarusian phone book and sent 200 faxes to phone numbers we found in it. Some of them ended up in women’s prisons, barber shops and god knows where else, but four companies out of 200 answered and one of them be-
Jaanus admits that they are still surprised how customers trusted them, as the product concept was something entirely new on the Eastern market. "Of course we didn’t know how to do everything. We used to joke among ourselves, wondering how things were done in “real” companies," Jaan describes the start of the company to the Director magazine.
There was one thing both men were sure of - dedicating to a field that is limited only to Estonia is pointless, the world is wide and if you do something, do it big. The Russian market was emerging and stabilizing, so it seemed like a great opportunity to the guys. “We were simply following our instincts; we didn’t really realize what we were doing. All the more amazing it is now to think back on how we put all our risks on the fact that a fifth of the world had just experienced a change of order, which also had to mean a change in construction quality. Until that moment, simply boxes had been built, but suddenly insulation
1995
OCTOBER 28 JAAN PUUSAAG AND JAANUS PAEVÄLI ARE HIRED. BOTH ARE NOW MEMBERS OF THE BOARD AND BLACK WOLVES
The profit report of 1996 in the Business Register said that in 1995, the company turnover had been 5.6 million kroons. Yes, it meant a 25 045-kroon loss, but a year later, the turnover was already 28 million kroons and the profit 76 759 kroons.4
CO-OPERATION WITH STROISISTEMA. TWENTY YEARS HAVE PASSED LIKE 20 MINUTES!
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troisistema’s representative Vsevolod Zorin, Wolf Group’s first client and partner, remembers it like that, “It was exactly 20 years ago, when the two very brave Estonian boys, Jaanus Paeväli and Jaan Puusaag thought they ought to make their life interesting and “set up a business”. On a rainy October day, having drunk a beer or two, they decided to create Krimelte. There was no indication it would be a bad idea, but neither were there any to suggest it would
FIRST FOAM BOTTLES HAVE ARRIVED
be a good one, because you need money to do business and that was something they didn’t have. So, instead, they invested their knowledge, energy and most importantly, their soul.” The company’s first office was situated in Tehnika Street 95. It housed the Sales and Purchasing Departments, the negotiation room and a warehouse. It was located next to the railway station, where you could often spot Jaanus Paeväli loading wagons with construction foam.
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1995 Now, do you think it was the healthy lifestyle, proper nutrition and exercise that made him the tough guy he was? No! It was beer, physical labour and colorful vocabulary that made him a strong stout successful businessman. Jaanus was a real competition to the local transportation companies. He could easily load a wagon of foam and reload it also, if it had been the wrong one. Later, he would take off his black hat, wipe away the few drops of sweat and turn to his next assignment with a smile. Just as Jaanus, also Jaan Puusaag is both smart and strong, but in another way. He didn’t go loading wagons, he was doing the analytics, financial prognosis and statistics in the meanwhile. It was his calculations that indicated they needed a third man to be successful… With time, an excellent team was
formed: Asko, Ard, Marek – all three have been in Krimelte since the beginning. None of them imagined the semidestroyed mazut station of an office-warehouse-negotiation room to become a leading factory in Europe and even the world. And it is indeed hard to believe it happened despite all the cataclysms, explosions, fires, company parties and also the Tamogawk Browser testings… Krimelte’s technical equipment is in no way lesser than that of his European competitors. Actually, it is even better than some others with its fully automated production cycle, robots, a great number of “weird” appliances, but most importantly – with all
IN PRODUCTION. JAANUS PAEVÄLI, VSEVOLOD ZORIN, ALEKSANDER KALININ AND JAAN PUUSAAG the pretty ladies on the assembly line. It has been rumored that Star Wars VIII will be filmed in the silicone line and Armageddon 2 in the Zhukovsky warehouse. 20 years have gone by like 20 minutes. I’m just now starting to realize that space can shrink and expand just as Penosil. And Krimelte is expanding and growing as it can. What else is there to do! 4
TO START PRODUCTION, JAAN WRITES A BUSINESS PLAN
1998 AUGUST 17 INGRID LILLEMAA, LINE LEADER AND BLACK WOLF IS HIRED.
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aan Puusaag says they knew that starting production was the only way to survive, but it felt like jumping into unknown waters.
Among other firsts, Jaan also had to write his first and only business plan to get a loan from the bank. “If I remember correctly, we took a 3-million-kroon loan from the bank in 1998. At that moment, it was a great deal of money for us,” Jaanus thinks back on the days on ehitusuudised.ee Internet portal. The guys didn’t know much about producing construction foams, but the
Danes had promised to share their skills. The Estonians were expecting detailed drawings and precise instructions, but all they received was a casual sketch that made no sense to them. Krimelte’s first paid employee, Asko Kruusement had a brother named Ard that was a great car mechanic, so he was called to help. “It was clear he knew much more about technology than us, so we asked him to become our Technical Director,” Jaanus Paeväli relates, amused. Jaan adds that the agreement with the Danes was that the Estonians would get a production license and the Danes help to train them. “I thought
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1998
FIRST PEOPLE STARTING WORKING ON THE LINE AND FIRST DEVICES ARRIVED they would send us detailed plans and projects, but they just faxed us a simple hand-drawn sketch – this is the pot, here is the tube, that is the tap and this is the machine. It looked like Chinese to me. I showed it to Ardi, so he would explain it to me and he looked at it and said – ok, I got it,” Jaan remembers the first a confusing puzzle that later turned into a beautiful picture of production. 4
IN THE RUSSIAN CRISIS The Russian crisis in 1998 was not good for business – as money was stuck in Russia, Jaan Puusaag and Jaanus Paeväli were forced to ask themselves, if this was the end of their enterprise. "The crisis influenced us greatly. Most of our assets had been invested into starting production and a month and a half after it had begun, the economy basically stopped. In February 1999, the factory was shut down with no orders," Jaan Puusaag remembers. Jaanus says the Russian market was their main export market back then. Luckily, their German partners believed in them and waited for the money
to arrive. "It was a very difficult time, indeed. What did we do? We came to agreements with partners who we owed money to and urged the ones who owed us to pay up faster – that was it," Jaanus recalls. He says they tried to avoid thinking about the worst possible outcome, which would have been that the waiters stop waiting and payers won't start paying. Jaan notes that, luckily, just a year later, Krimelte was back on track and business starting rolling. "If it weren't for good client and partner relationships, this crisis could have been fatal for us," Jaan is sure. 4
RUSSIAN FINANCIAL I.E. RUBLE CRISIS August 17, 1998 the Russian ruble was devalued and the country proclaimed insolvent. The reasons for it are considered to be decreasing production, constant financial deficit and artificially high-fixed rates between the ruble and foreign currency.
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2000
THE KING OF FOAM DEVELOPMENT TOOMAS SEPPER IS A PERSON WHOSE CONTRIBUTION TO KRIMELTE’S GROWTH CANNOT BE OVERRATED, BECAUSE HE IS RESPONSIBLE FOR ALL THE COMPANY’S MOST POPULAR FOAMS. to show his “prey” to the rest of the group,” Tiit accounts.
JANUARY 10
TOOMAS SEPPER, PRODUCTION DEVELOPMENT MANAGER AND BLACK WOLF IS HIRED
oomas came to us straight from university and except for one small detour, has always worked with us. Chemists are a special breed with a unique way of thinking. Toomas is a hermitic person, very calm on the outside, but very passionate about his work on the inside,” Jaan Puusaag characterizes Toomas Sepper.
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Toomas, born in Rapla, has graduated Rapla’s II Secondary School and studied Textile Technology at the Tallinn University of Technology. As he has always been interested in chemistry, he didn’t even think about going to study anything else. Tiit Arro has only good words to share about Toomas Sepper. “Toomas Sepper,
or Tom, is a special member of the group that by status is already a Black Wolf.” Tiit adds he has never heard anyone criticizing Toomas. If something hasn’t been ready as quickly as first needed, they’ve just dealt with it. “Tom always has a reason. Either the experiments haven’t worked out as hoped or some urgent matter needs handling first. In the end, he always keeps his promises and everybody knows that. He just needs time. Chemistry is a natural science and as we all know, nature is not very predictable,” Tiit accounts. “Tom’s professional knowledge, successful experiments and brainwork have given us most of our iconic construction foams. Tom is the kind of wolf that sometimes separates from the pack to do some thinking, but then returns
According to Jaan Puusaag, the Pärnu laboratory was created only for Toomas. It is thanks to Toomas that Krimelte has become a world player. “We’ve gone a long way from a small enthusiast to a world class company and it has only been possible thanks to our team. Tom’s tenure goes back to the previous century when our laboratory was a poorly isolated booth in the courtyard of our factory, whereas the factory itself could be named a “factory” only conditionally,” Jaan remarks. According to Tiit, Toomas doesn’t get a lot of visitors in Pärnu. He says the laboratory is like the “black box” of Steve Jobs’ development centre where only a few can enter. Just recently, another experienced development worker Tanel Toomela joined the laboratory. “His arrival gives faith to the rest of the wolves that some projects that have been living their own lives for a long time, will now find their solutions. Two heads are better than one,” Tiit believes. According to Tiit, Toomas loves music and his taste varies from hard rock to classical choir music. He also loves the cinema and he is a computer game enthusiast. “He doesn’t say no to a nice beer either,” Tiit points out. In Audru, Pärnumaa, Toomas has a spacious garden that takes up most of his free time. He has two sons. 4
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INTERVIEW WITH TOOMAS How long have you been working in Krimelte? 14 years and 9 months What do you like most about working here? The exciting job. Each day is different and full of challenges. What do you think is your greatest contribution to Krimelte’s production development? Can’t say, really. A bit here and there, I guess.
What do you think is Krimelte’s best foam? The fire stopping foam, because it has a greater added value and its area of use is more exciting than that of normal foams. You’ve been named Krimelte’s foam development genius - how do you feel about it? In no special way, really. What does the title "Black Wolf" mean? I guess it means I’m an experienced worker with a considerable baggage of information.
2001
OCTOBER 25 JANNO VILBA, MASTER AND BLACK WOLF
AUGUST 7 ELISABETH OORN, OPERATOR AND BLACK WOLF IS HIRED
AUGUST 13 VALLI LEPPSALU, LINE WORKER AND BLACK WOLF IS HIRED
AUGUST 21 ELLEN MESIPUU, LINE WORKER AND BLACK WOLF IS HIRED
SEALANTS ARE ADDED TO THE PRODUCT PORTFOLIO KRIMELTE'S QUALITY MANAGEMENT SYSTEM RECEIVES THE ISO9001 CERTIFICATE
2002 NEW PRODUCTION BUILDING IS FOUNDED
COMPANY'S QUALITY MANAGEMENT SYSTEM RECEIVES THE ISO14001 CERTIFICATE
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2003
ur official co-operation with Krimelte sarted in August 2003. That’s when first Krimelte products were released from our assembly line. But before that, there had been a long familiarizing and negotiation period since October 2002,” Metaprint’s CEO Martti Lemendik describes the beginning of collaboration with Krimelte. Martti says the only problem they have had so far has been that until 2005, Metaprint’s bottle production capacity was smaller than Krimelte had hoped for. “Our production capacity was limited at first, so gaining quantity quickly was an issue. But of course, for us, it was a positive problem,” Martti recalls.
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In 2005, Metaprint, the Estonian producer of decorated metal tare, opened a new factory in Pärnu, which was a great relief. “We’ve always tried to work as closely as possible. They are a good partner. They know exactly what they want and we have developed our service according to them. Plus, their product portfolio is wide and all in all we supply around 450 products to them,”
CO-OPERATION WITH METAPRINT DEVELOPS STEP BY STEP
Martti comments. “We hope our efforts pay off, since we give our best to be better than our competitors every day. We hope our relationship with Krimelte to be permanent and long lasting, but as always, in these questions, the ball is on Krimelte’s court,” Martti shares.
AN HISTORIC PICTURE. FIRST GOLDGUN FOAM BOTTLES ARE BEING MADE ON THE METAPRINT LINE
ESTONIA IS TOO SMALL FOR METAPRINT
Metaprint mostly produces aerosol containers and Estonia has grown too small for them in the field. “It is geographically impossible for us to reach new customers. Most of our business is located in Central and Western Europe; we cover Germany, Holland, Belgium, Poland, the Czech Republic and Great Britain. We consider Scandinavia to be our home,” Martti accounts. He says that Metaprint’s circle in Estonia is closing up and it is time to take on new challenges across the borders.
Metaprint has been active as an independent corporate body since 1995, but its production experience in the field dates back to more than a hundred years. The company has approximately 200 employees and production has constantly been modernized.
METAPRINT SUPPLIES
450
PRODUCTS FOR KRIMELTE
“When Krimelte set up a unit in Russia, they invited us to go with them. It seemed like a good idea to us and we’ve set up a network in Russia to offer a good service to both Krimelte and other companies as well,” Martti reveals. He adds that Russia’s market is
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GOLDGUN
big and full of opportunities, but he also states that it’s a market with great political risks. “The present developments in Russian politics are quite alarming. But at the end of the day, Russians also want to live in a modern way,” he shares his opinion. As long as it is possible to operate in Russia, it is worth it.
ENTERS THE MARKET WITH A LITTLE HELP FROM JAMES BOND
HOW ARE PENOSIL FOAM BOTTLES MADE? “The production of this specific brand is not much different from other similar products on the field. Aerosol bottles arrive to Metaprint in the shape of metal boards from the steel producer. A part of them is used for bottle tops and bottoms and the rest are printed as bottle bodies. After printing, bodies are cut out of the bigger boards, rounded into cylinders and brazed. Then the tops are attached to the bodies and they move on to the pressure tester. Tests successful, they go on to robot operated filling where they are laid down on a base, pulled together with birches and laminated in the end,” Martti describes. 4
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AUGUST 19 ANDREA PRUNT, LINE WORKER AND BLACK WOLF IS HIRED
AUGUST 18 RAISSA BORISSOVA, PERSONNEL SPECIALIST AND BLACK WOLF IS HIRED
OCTOBER 18 JANEK LEPPIK, MECHANIC AND BLACK WOLF IS HIRED
AUGUST 18 KALLE KAASIK, WAREHOUSE OPERATOR AND BLACK WOLF IS HIRED
he birth of the construction foam GoldGun was inspired by a James Bond movie and has now become one of the most popular products.
“This foam has gone through several stages of development. If I remember correctly, the GoldGun idea comes from the James Bond movie The Man with the Golden Gun. When Bond’s slogan was “Golden gun, licensed to kill” then ours was “GoldGun, licensed to fill”,” Jaanus Paeväli tells the humorous story of how the product was born. Some products even had product codes beginning with 00, just as we all know James Bond’s code was 007. “But we didn’t put enough effort or time into the idea, which is essential in marketing. We were clueless, when it came to copyrights, so in order to avoid a possible conflict, we simply stuck with GoldGun and stopped selling it with reference to James Bond,” Jaanus explains. Tiit Arro says that when talking about GoldGun, it is important to keep in mind that at the time of release, Krimelte’s main market was Russia. “We had concentrated on creating joint filling foam for windows that would handle Russia’s continental climate with very low temperatures and extremely dry air,” Tiit relates. “One component polyurethane foams need a fair amount of air humidity and preferably room temperature to be produced. Neither of these conditions
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2003
exist in the Russian winter. Actually, it may be overly dry also in the summer. Therefore, the cheaper simpler foams are not good enough for the professional window installers,” Tiit explains. Krimelte’s distributors in Russia had already obtained a fair customer base and regional distributors by then, so when Krimelte’s development chemist Too-mas Sepper introduced a foam that would work well in a dry cold climate, also enabling vast quantity, having excellent creamy consistency and a fantastic structure, the product quickly gained popularity. Later, GoldGun 65 al-
lowing even more quantity and GoldGun 65plus followed. The present product portfolio is numerous. “Our laboratory holds 180 different recipes, only 70 of them being in everyday use. Some recipes may never enter the market. We only look at new recipes when there is need,” Jaanus adds. Foams are constantly being developed in the laboratory and there are now 15 people working in the Development Department – chemists, technologists, lab workers and many others who all play an important role in the making of construction foams. 4
SALES TO FINLAND BEGIN Having lived in Finland for a bit more than two decades, Aivar and Külli Saviauk were the ones who introduced Krimelte to the Finnish market that loves loyal and stable partnerships. By today, they have become an influential stable partner to many Finnish companies. Their first product was the GoldGun gun foam. “We started going from site to site, where windows were being installed and convincing workers to use our foam,” they recall and add that window installers were chosen because that was the field that used foams most professionally. By today, the produce of Estonian wolves is a recognized product. 4
ENTERPRISE AWARD 2003
MOST COMPETITIVE SMALL INDUSTRIAL AND ENERGY ENTERPRISE
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THE HEAD OF THE LATIVAN SUBSIDIARY VIESTURS SALTAIS
2004
SUBSIDIARY IN LATVIA IS FOUNDED Krimelte Latvia SIA’s Executive Officer Viesturs Saltais says that having gained a reputation of a stable trustworthy company on the market, their production capacity has grown by 40-50%. “The PENOSIL brand is mostly seen as a high quality brand. Even more so, as we do not only offer products, but also a secure relationship. We offer the full service: delivery, good conditions and we go on-sight in case there is a problem – that’s the kind of service customers appreciate,” he claims. 4
WOLF CLUB IS CREATED TO UNITE PEOPLE he idea for Wolf Club actually came from the advertising agency called Wolf that suggested us to pick an animal as a central figure for the company story. They told us about an example of an enterprise in the USA, where everything was related to fish. We kept thinking and thinking and the most suitable creature from the entire zoo seemed to be the wolf," Jaan Puusaag shares the story of the beginning of the Wolf Club. Coincidentally, it was also Krimelte's 10th birthday and so it was decided it would be the occasion on which Krimelte's wolves will be presented for the first time. "At the beginning, we were worried, whether the story would survive, because it needs constant contribution.”
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Jaanus Paeväli believes the Wolf Club is an excellent means of co-operation that unites people. "It's not a temporary project, but meant to last for many years, decades even. It's a story and a story always brings people together. Stories make everything more valuable," Jaanus remarks. Tiit Arro recalls that when he joined Krimelte, the Wolf Club had already been created and his first contact with it was at the company summer event. "Unexpectedly for me, a part of the employees were asked on stage and then began the ceremony of be-wolfing, where we had to recite the Wolf Club oath and were invited to participate in group howling. After that, all puppies were named wolves,” Tiit shares his experience and adds that two years later, he witnessed that same ceremony as an experienced wolf.
THE OPENING OF THE WOLF CLUB FAMILY DAY IN 2014
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2004
mon goal are valued, promoting shared virtues such as courage, wit, team work and care. To keep the relationships close and improve collaboration, fun gatherings are organized for wolves of different levels. "Occasions that join the entire Wolf Club are the summer and the Christmas events. The more active members do sports every day, which is supported by the NGO Krimelte Wolves," Tiit explains the club’s activities.
“When five years passed, I was attributed the Grey Wolf title, after seven years, the White Wolf title and the coming spring, when 10 years will have passed, I hope to become a Black Wolf," Tiit shares. For the moment, no further titles have been announced nor has anyone been erected a foam sculpture. “There exists, however, a Brotherhood of the Ring, the shortlist of which remains unpublished, but some sharp colleagues have noticed a Wolf Club ring on the fingers of some of the wolves,” Tiit notes. According to Tiit, Wolf Club conveys the metaphor of a pack of wolves, where collaboration and orientation to a com-
The more important partners in different parts of the world may also be attributed the Wolf or Honorary Wolf status so they would feel like a part of the wolf pack. They just need to share the same values as the rest of the pack. 4
THE NEW WOLF CLUB LOGO WAS DESIGNED IN 2012
ENTERPRISE AWARD 2004
JUNE 7 URMO LAMP, SALES MANAGER AND BLACK WOLF IS HIRED
LARGE EXPORTER
JULY 1 JAAK KRUUSEMENT, LEAD MECHANIC AND BLACK WOLF IS HIRED
NOVEMBER 1 JÜRGEN KOOSAPOEG, LINE LEADER-FITTER AND BLACK WOLF IS HIRED
DECEMBER 1 VIESTURS SALTAIS, HEAD OF THE LATVIAN SUBSIDIARY AND BLACK WOLF IS HIRED
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2005 WOLVES NEAR MOSCOW THE UPCOMING YEAR, KRIMELTE’S RUSSIAN FACTORY WILL BE CELEBRATING ITS 10TH BIRTHDAY. ACTUALLY, IT HASN’T EXISTED IN ITS PRESENT FORM SINCE 2005, BECAUSE THE RECONSTRUCTION OF THE OLD BUILDING AND CHANGING IT INTO A MODERN PRODUCTION CENTRE ACCORDING TO THE EUROPEAN STANDARDS TOOK A FEW YEARS, BUT IT WILL BE TEN YEARS FROM THE LIFECHANGING DECISION TO START FOAM AND SEALANT PRODUCTION IN RUSSIA, NEAR MOSCOW, IN ZHUKOVSKY
he new-born company was actively working since the first day and, as a result, a new sealant entered the Russian construction market in 2007 that was suitable even for the most demanding customers. Production of foams began in 2009, which made the company second biggest producer by capacity on the Russian market. where the company had only recently sky-rocketed.
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At present, their portfolio includes a wide selection of high quality modern foams and sealants, including some that have no alternative producers in Russia, thanks to which the company has found its place among the leaders of the construction market. Krimelte’s products are special and partners as well as employees are well aware of it.
JOB INTERVIEWS DON’T REQUIRE SINGING “What most struck me, when I first got to know Krimelte was its extremely unusual approach to recruiting managers,” Andrei reminisces, “I am a production person from head to toe and I thought our first meeting would be about what it means to work with Russian men, how to solve problems with appliances and materials, etc – basically, about the tough everyday life. And I was indeed explained all that, but it was followed by a completely different set of assignments: I had to complete psychological tests, answer riddles, draw circles and crosses, solve logical problems on the count of time and more. The only thing I didn’t have to do was to sing. Which is a pity, I would have managed perfectly,” the manager jokes.
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2005
months for the answer, but I survived.” Customer needs have always been the center of attention in Krimelte and three partnership rules have always been followed: consistent product quality, fair prices and timely delivery. That is why Krimelte is now the producer for the biggest production and industrial enterprises at the Moscow region. But the work continues.
new system that enables transfer to other recipes without stopping, which has made the percentage of technological loss very stable. Product shipment is organized in a way that cull and delay are out of the ques-
“At the moment, the situation on the construction material market is complicated with all the sanctions and the decreasing sales. What does it say to us? Just one thing – now is not the time to relax,” the manager believes. “On the contrary, we have to work even harder and get ahead of our competitors and find new markets. I don’t doubt we can manage, because I have a great team backing me up that can take us through any difficulties. We are not the kind of team that gives up to difficulties or sinks in stormy waters.”
ANDREI ŠUMSKIH - HEAD OF THE FACTORY IN MOSCOW
Krimelte’s approach to the recruitment process was very impressive for him. “I guess that’s when I really started wanting to work for this company – something got to me and intrigued me. Though I didn’t know what would happen, I refused all other offers the following days. I wasn’t interested in them anymore. I only wanted Krimelte and kept believing they would choose me. It was very difficult to wait for two
Shumskih says the company’s priorities are expanding production and improving product quality. Numbers prove they are doing a good job. When last year, one line was producing 15 000 bottles, then this year, the digit has already gone up to 16 500. One of the reasons for this notable increase is that with technical errors being constantly monitored in the factory, there are less technical stoppages. Product quality has gone up as well: a year ago, cull formed 0.1% of produce, but the same number for the first three quarters of this year is 0.06%. This success is a consequence of the hard work of the Production Manager and the Engineer who have achieved a remarkable technical stoppage decrease together with the plant specialists. The mechanics have also implemented a
tion and this has had a positive impact on customer relationships. “Clients like working with Krimelte, because we speak Russian to them, but work according to the European standards,” Shumskih notes. Constant development is a norm for Russian Krimelte. At present, two construction projects are underway: warehouse for acetone and water containers for fire safety. Yes, the company operates using the newest technology and that is very important, but what always has mattered
WOLF TALES - ANNIVERSARY SPECIAL • 2014 > 17
most is the team. The manager confirms that each and every employee contributes to the well-being of the company. “Take accounting, for instance. It might seem as if they are far from production, but good control over cash flow is substantial. Or our small sales department,
consisting only of one person, that has managed to find a great number of new big customers this year, creating a good base for the future,” Shumkish describes his team. During the 10-year history of Krimelte Russia, different and also difficult times have been seen. Sometimes, the number of employees has had to be optimized; organizational structure and responsibility fields have had to be changed, etc. Some unpopular steps have had to be made. The company management thinks it’s a part of evolution and usually people understand.
“Krimelte Russia’s history is full of hard work, preservation, team spirit and good strategic decisions,” Andrei Shumskih believes. “Our factory has something to be proud of. In light of the upcoming 10th anniversary, I think about the future of the factory and I believe in its success
and prosperity. I thank everybody that has participated in the birth and life of the factory and dedicated a significant amount of work to it.” 4
WAREHOUSE OF THE ŽUKOVSKI FACTORY
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2005
Why was it decided to open a new factory in Russia in 2005? Russia has always been Krimelte’s biggest market and despite the recent decrease in its proportion, it still is. Basically, there are two reasons for opening the factory – a “political” and an economical one. The “political” reason was that since in the beginning of the new millennium, it was normal to wait in lengthy queues at the Russian-Estonian border (we all remember having to wait in line for ten days or even two weeks), our Russian partners insisted we open production in Russia to avoid risks that the borders would entirely close for import from Estonia. The economical reason was and still is the peculiarity of the Russian market and customs. More precisely, a large part of the Russian market is occupied by big foam containers that are only filled up to 1/3 of the entire package. Yet, the company has to pay taxes according to the larger size, which makes the taxes significantly higher than the real value of the container, so the import turns out to be quite costly, hence, the idea to set up a factory in Russia. The first products produced in this factory were actually these cheap foams for the Russian market.
INTERVIEW WITH
ALAR SALUM What were the goals? Have they been achieved? The most important goal was to satisfy the requirements of our Russian customers. Looking at the situation today and considering our customer base, it is safe to say these needs have been met, but at the same time, new ones have been developed, so work continues and the Zhukovsky factory has a lot of room for growth. Enhancing productivity is something we are dealing with every day and there are still enough customers on the market to lure into our “boat”. How were the location and management of the future factory chosen? The location was the idea of our biggest Russian distributor – Stroisistema’s owners Vselovod Zorin and Alexander Kalinin. A suitable plot was available in Zhukovsky, not far from Reutov, where Stroisistema’s office was situated and thanks to Sassi-Seva’s contacts, we also found the factory’s first employee – Andrei Kudrjashov, whose job was to put together the rest of the team.
What do you remember about opening the factory? I have many memories of that time. Starting from the feeling of hopelessness, when I first went to see Zhukovsky up until the opening party with a fire-show. The most vivid ones are probably not directly connected to the factory, but to Zhukovsky and its surroundings – the hotels, where we spent our nights at first are quite a big contrast to the present day, mostly because of the quality and culture of construction. I vividly remember how I once woke up in a hotel called Tihhaja Zavodi, because of a noise that seemed to be coming from the room I was sleeping in. Turned out, they were actually voices from the corridor, but since the doors were not soundproof at all, it seemed as if they did not exist. Or the memory of the Russian army fighter aircraft flying over the factory with everything around us trembling so that it was impossible to speak to each other – the Zhukovsky factory is located right next to the Ramenskoje aerodrome, where the international aviation exhibition and show Aviasalon MAKS takes place every two years. Before that, trainings are held, which we’ve had the chance to observe several times from the courtyard of the factory. 4
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ROUND TWO IN KAZAKHSTAN KAZAKHSTAN IS AMONG THE TEN MOST EMERGING ECONOMIES TODAY AND KRIMELTE HAS BEEN KEEPING AN EYE ON THAT MARKET FOR QUITE SOME TIME ALREADY. BUT BEFORE CONQUERING THE PROMISING MARKET, THERE WAS A PROBLEM TO BE SOLVED – A FUNCTIONING DISTRIBUTION CHANNEL HAD TO BE FOUND.
tween the Estonian producer and the Kazakhstani distributor began, but along came the economic meltdown. As a consequence of the recess, Turkuaz decided to leave the market of construction materials and the merchandise network Karimov had built up during the years, stopped existing. “Liquidation of a company that I had dedicated years of my life was tough for me, Penosil was a hope of rebirth for me and my companions,” Karimov relates. Together with Krimelte, he set on to creating a new distributors’ network in Kazakhstan. They were back to zero, as the old one had been destroyed and everything had to be started all over again. They could only count on themselves and the support of the Estonian partner.
100 TENGES FOR CHILDREN WITH HEART FAILURE ŽENIS KARIMOV WITH JAANUS AT A WOLF CLUB EVENT IN 2010 y co-operation with Krimelte started out in 2004 at the International Construction Fair MosBuild2004 in the Moscow exhibition centre Krasnaja Presnja,” Zhenis Karimov, Krimelte Kazakhstan’s General Manager says. At that time, he had just been selected to run one of Kazakhstan’s biggest administration companies – Turkuaz. His trip to Moscow was not purely curiosity. He had a mission: to start off the company he was working for as quickly as possible and to do that he needed construction and finishing material distributors he could rely on.
M
Krimelte’s booth immediately got his attention. But his first attempt to start ne-
gotiations with the representative failed. “There were too many people at the booth. I passed by several times, but there were always so many people and many of them wanted to speak to the representatives. So, I couldn’t start negotiating then. I just left my contacts and it worked,” Karimov shares. His first conversation with Jaanus Paeväli was held on the phone, but the head of the Estonian company soon travelled to Almatõ himself. Meeting him really made an impression on Zhenis Karimov and he realized immediately he could and should co-operate with a person and a company like this. The mutually beneficial collaboration be-
By now, the Kazakhstani enterprise Ideal Trade is so secure it can contribute to charity and participate in the Give Life initiative with Krimelte Estonia, organized by the Kazakhstani public foundation Mercy Volunteer Society. 100 tenges of each sale of Penosil GoldGun65 goes to curing children with heart failure. “I often go to Estonia because of commerce and it keeps amazing me how fast and effective is Krimelte’s growth,” Karimov shares. “The annual seminar organized by the company and the following celebrations are always an important event for me. Not just pleasant, but also useful, because I always find new friends and partners. Especially now that the factory belongs to the Wolf Group which unites companies in many different countries. Meeting representatives of this business family just confirms my conviction that together we can do even more and even better.” 4
2005
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AWARDED COMPANY In 2003, Krimelte was chosen as the best Large Exporter and a year later, the company was again among the finalists. 2005 was a year of growth for Krimelte and the Entrepreneurship Award coincided. “In 2005, Krimelte grew significantly, which suited well with the selection methods of the Entrepreneurship Award. That’s how the honor came to us. We did not make any special efforts to participate in the contest. But it was very pleasing to receive this recognition and of course, it was nice to use this in our marketing materials as well,” Tiit Arro describes participating these contests. 4
ENTERPRISE AWARD 2005
LARGE EXPORTER
PENOSIL BRAND WAS CREATED THINKING ON THE CUSTOMER evelopment of the Penosil brand was generated by practical need. “Our product portfolio had significantly grown during the previous 10 years and it was full of products with very different names. First, all markets, customers and competition were discussed among the management. Then we concentrated on the positioning of the price and quality of the new brand and set on a concept what the new profile would represent to our sales channels and end user,” Tiit describes. Luckily, Krimelte already had a very clearly posi-
D
tioned reference point, which was the highly valued GoldGun product. After careful positioning and deciding that the marketing would only be dedicated to one principal brand, the three price ranges of Penosil were created: Gold, Premium and Standard. “The Premium level included the whole Penosil range, except GoldGun that became the flagship of Penosil brand. As GoldGun was already very highly valued on the main markets, we used it as an engine to gain popularity also for the new brand,” Tiit explains. 4
KRIMELTE'S WIDE PRODUCT PORTFOLIO BEFORE PENOSIL TRADEMARK
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PROFESSIONAL FOAM, NO GUN EasyGun has become an icon. “It is a very high quality joint filler, special for its internationally patented applicator EasyGun developed in Krimelte. When normally the construction foams in foam guns or straw applicators differ greatly among each other, mainly because of the foam structure and quantity, then EasyGun made it possible to use professional foam without owning a gun,” Tiit Arro says and adds that Krimelte’s promotional materials state Easy Gun to be the world’s cheapest foam gun. 4
FIRST PACKING ROBOT IS PUT TO USE
2006
2007
SUBSIDIARY IN ROMANIA IS CREATED • From 2013, Romania’s subsidiary is led by Sebastian Carstoiu. • In Romania, the straw applicators are more popular than foam guns. • Penosil foams are sold to big dwelling and office developments and even to the Bukarest underground. • Krimelte’s products are sold in retail in about 600-700 shops. • The Romanian market is wide and construction foams cheap. It entails about 25 000 construction companies and 300 000 constructors.
ENTERPRISE AWARD 2007
EXPORTER OF THE YEAR
CORNER STONE FOR THE NEW FACTORY IS PLACED
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2007 JANUARY 5 ALAR SALUM,
CEO AND WHITE WOLF, IS HIRED
ALAR “ALARM“ SALUM – THE METICULOUS AND HUMOROUS LEADER KRIMELTE'S CEO ALAR SALUM LOVES HIS JOB, BECAUSE IT GIVES HIM AN OPPORTUNITY TO INTERACT WITH PEOPLE FROM DIFFERENT CULTURES. OUR RUSSIAN COLLEAGUES LIKE TO CALL HIM "ALARM"
hen one of our biggest customers in Russia heard Alar’s name for the first time, he said jokingly it sounded like “alarm”. And it's funny, because the comparison is actually quite accurate," Jaan Puusag describes the company's hard working and meticulous CEO Alar Salum.
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Alar Salum found his way to the company through a coincidence. "As it often happens on these occasions, Mr. Coincidence had a lot to do with it," says Alar who got the job thanks to Tiit Arro. The men knew each other, but had not met for a long time when one day they happened to do business and play tennis together in Pärnu 10 years ago. That’s when Tiit introduced Alar to Jaan. Jaan started thinking Alar would be a perfect Sales Director for Krimelte and in the end, he offered him a job as the CEO. That's how it went. And now, Alar has been in a working relationship with Krimelte for 8 years already.
ALAR IS AN EDUCATED AUTOMATION ENGINEER "I got my diploma from the Dresden Technical University in Germany (when it was still the GermanDemocra-
tic Republic), which I graduated in the spring of 1988," Alar recalls. Apart from the fact that automation also deals with system and process management, his present day job is quite far from his original profession. In 1997, Alar started working in Hamburg, Germany where his job was to build up and manage a sales distribution network for the then famous Estonian textile company Kreenholm. "But at one point I realized I really wanted to go back to Estonia. It was much sooner than the "Talents home!" campaign had begun, in 2003, when I landed in Pärnu and took charge of the Western Estonian branch of G4S," Alar recalls. "I've been intrigued by the internationality of this company since the start. By nature, I'm a person who likes interacting with different people and
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often go berry and mushroom picking in the forest, swimming at the beach and riding bicycles – all fun things any normal family does. "As my children love singing and dancing, we often have concerts and dance shows at home where we have to fill in the role of the audience," Alar adds.
KRIMELTE'S BAD BOYS HAVE BECOME FAMILY PEOPLE
cultures. I like mediating, connecting dots, organizing activities and teaching people," Alar shares. Krimelte is constantly growing and operates in very global competition terms – most of its markets are located outside Estonia, its distributors are foreign companies, and even the majority of Krimelte's competitors are European. "Looking at our team, I feel I’m surrounded by people who also enjoy the global reach, the communication between different cultures and constant growth. I love working with people who are eager to learn and develop in order to take their work/Krimelte's produce to the world and represent our small country," Alar shares happily. He is responsible for the organization of Krimelte’s daily life. "Somehow I'm often asked what I do in Krimelte. I usually answer, joking, that I do everything no-one else wants to do!" He is actually motivated by everything that makes him feel he's growing while doing it. Alar's work days are all different. Some days are about answering e-mails and sitting through meetings, others about making business abroad. "My children also ask me what I do at work. I guess I just don't have a "normal working day" –
despite some repetition, every day is different," Alar says.
A FEW MONTHS A YEAR HE WORKS ABROAD Alar has the kind of job that takes him abroad at least a month or two every year. "Some months I don’t leave Estonia at all, but then there are others when I'm almost always travelling." This year, when renewing his travel insurance, he had to calculate how many days he approximately spends travelling – last year, it had been around 70. "2014 has not been much different." Despite this, he believes he is a family man. "My wife says she is used to dealing with everything alone, because I'm never at home, but I still think I'm a family person," Alar says. He has four children the two elder ones from his first marriage are students in Germany and living their own independent lives. The two younger ones – a 10-year old daughter and a 5year old son are at home. "They go to school and kindergarten and still wait for their father to come home and help with the mathematics quiz, play checkers or "Trip around the world" or just fool around with them," Alar shares. He likes travelling with his family both in Estonia and Europe. Together, they
When Alar has time, he likes to keep in shape and do sports. He also enjoys learning different languages. "I just started learning Spanish this year to speak with my colleagues from Olivé in their mother tongue in the future. Sometimes I meet my friends or indulge in reading, going to the theatre, visiting concerts or simply watching TV," Alar lists his preferences. Alar believes Krimelte is an enterprise, where you can have a good time with your family and colleagues. “We just realized the other day that during these 20 years, Krimelte has changed from a youth company to young families' company. Around 10-15 years ago, Krimelte's employees were mostly single and liked hanging out together, but now you can mostly see them having a good time with their families at the company events and that's why the nature of the events has changed as well," Alar explains. Alar is not quite sure about how far Krimelte will go, but he's positive it will be far, very far. "As Jaanus once said – and I completely share his feelings – it's not the destination that matters, it's the journey. I don't think we need to be the number one in the world or Europe or wherever. It is important to do our job well, quickly react to the changing circumstances, develop, be flexible, maintain close relationship with our clients, distributors, and colleagues, and if we can do all that, then success will follow," Alar is sure and adds that then maybe one day Krimelte will be number one in its own field. 4
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JAAN PUUSAAG:
JAANUS PAEVÄLI:
Our board consists of three members –Jaanus Paeväli, Alar Salum and I. The management wing is a cozy hard-working space always accompanied by fun. Our team spirit is great and what is even more important – we complete each other. Alar may seem like a control freak and he certainly is that to a certain extent, but it is necessary to compensate for the tendency of Jaanus and me to slip over details. Alar is incredibly hard-working and I am often not able to keep up with his e-mails after midnight. Last summer was his first vacation ,where he didn’t react to every e-mail he received.
Alar is a highly appreciated person and colleague. Working with him is pure joy - he's thorough, sometimes even frighteningly so. He doesn't like loose ends.
Alar will soon have completed eight years in the company. It is a long time and looking back to where we started and where we are today, it has also been incredibly eventful. Luckily, we've left behind many road signs that remind us where we come from.
WOLF CLUB PUBLISHES THE FIRST CLUB MAGAZINE KRIMELTE WOLVES
2008
NEW FACTORY AND OFFICE BUILDING IS OPENED A new factory building is opened in Tallinn. The size of the investment is 90 million kroons. The new factory houses the joint filler production, so construction foam production can be enhanced in the existing one. The entire area of the new production is 7100 m2 with the factory covering an area of 6000 m2.
When Alar had been working with us for years already, it turned out he and I were related. We realized we were 5th generation relatives, so we come from the same tribe.
JAAN PUUSAAG IS ATTRIBUTED THE TITLE OF ENTREPRENEUR OF THE YEAR (EOY) 2008 BY ERNST YOUNG
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DIVE INTO THE FAÇADE AND CONSTRUCTION BOARD BUSINESS
In March 30, 2008, Wolf Group starts the façade and construction board business under the name of Krimelte Tempsi. The Tempsi brand was already known on the
Estonian market as a trustworthy façade solution with a good price. Wolf Group started selling the boards in Lithuania and Latvia as well. By now, the export has also extended to Norway, Finland, Poland and Belarus that make 30% of the whole turnover by now. The most popular Classiko category ven-
tilated façade solutions are the stone-covered cement boards Granito and paint covered Colore boards. Architects mostly prefer the Superiore category fiber cement porcelain boards. On the Estonian, Latvian and Finnish markets, the smaller Zoccolo socket boards are more popular. The team of Krimelte Tempsi OÜ is constantly coming up with new façade and construction solutions and expanding to new export markets. 4
KRIMELTE LT IS CREATED
WOLVES IN BULGARIA
The manager of Krimelte UAB LT, Dovydas Austras was first Krimelte’s customer, working as the Senuku Prekybos Centras’ Purchasing Manager. His contact in Krimelte was Artur Meeksa. The latter was actually the one who proposed Dovydas to come and join Krimelte. “I accepted the challenge, because Krimelte’s products are of very high quality and it is easy to sell quality,” Dovydas admits.
Even though the enterprise was founded already in 2009, real operations were started in 2010. Although Krimelte arrived late compared to all main competitors, it has managed to position its presence among distributors and retail chains. Now it is much easier to redirect end customers in all major cities, who call the office and ask where they can purchase a certain product (in comparison with 2010,2011, when end customers had minimal opportunities). Currently, the team is comprised of three people – a Sales Manager in Sofia and Sales Representatives in Burgas and Haskovo. Krimelte was the first company to introduce the “wooden frame” – used mainly for trainings and presentations in stores and in front of professionals. All trainees respond well to such tryouts and claim that this is the first time they get to try out foam this way. 4
Penosil’s practical construction project LAB is very successful in Lithuania and significantly contributes to the sales. “On demonstrations, we present the entire Penosil portfolio, concentrating on the most important and more specific products, such as EasyGun, BathCoating, GoldGun 65, General silicone, Waterstop and Dustproofer. LAB demonstrations are clear and easy to grasp as we always perform experiments, have customers try our products and are open to any questions they might have,” Dovydas adds. Besides handling the Krimelte LT, Dovydas is now active also in exerting retail conceptions in Romania, the Baltic countries and the principal markets of Olivé Quimica. 4
SUBSIDIARY IN UKRAINE IS FOUNDED The leader of Krimelte Ukraine, Andrei Fedko believes it is the growing product portfolio that helps to conquer competitors. Andrei, “Price is the most important factor for the Ukranians, but they are already realizing that it is better to buy Penosil, because in the end, it is cheaper than any other product.” 4
PENOSIL PRESENTATION PROJECT LAB IS SUCCESSFUL IN LITHUANIA. THE HEAD OF THE LITHUANIAN SUBSIDIARY DOVYDAS AUSTRAS
THE HEAD OF THE UKRAINIAN SUBSIDIARY ANDREI FEDKO
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2009
COMPANIES UNITED UNDER
j
WOLF GROUP UNITES ALL KRIMELTE’S SALES AND PRODUCTION ENTERPRISES IN ESTONIA AND ABROAD, INCLUDING ALSO THE BRANDS PENOSIL AND TEMPSI
WOLF GROUP
aan Puusaag says the new common brand was necessary, because of the quick growth in recent years to new production fields.
“The objective of this brand is to make sure all the group’s enterprises follow the same principles in product quality and business conduct, and also to make the company structure a bit more logical and easier to understand for both clients and partners. The change helps customers to relate equally qualified products and enterprises in more than 30 countries,” he explains. The Wolf Group logo portrays a wolf. “Wolf is a good northern symbol reflecting intelligence, ambitions, and courage, but also collaboration skills. And that is how we see ourselves. The wolf theme is not new for Krimelte. We’ve been calling ourselves Krimelte wolves for years now. We operate as a pack and follow the same credo as real wild wolves. So, using the wolf symbol in the new brand was a natural course of events. We hope our clients and partners also feel like a part of our wolf pack,” Jaan shares. 4
BRAZIL CONQUERED UNEXPECTEDLY QUICK
T
he Brazilian market is attractive mostly because of its size, but it is not very easy to enter. It’s a highly bureaucratic and protectionist country. Krimelte’s export manager Tarmo Nork remembers that when he participated in the country’s biggest construction fair Feicon in March 2008, he returned with modest optimism. “I made some contacts, but it’s no secret that in our business, bigger deals take a year or more to be made,” he remarks. Surprisingly though, things went smoothly. The visit to the fair aroused interest in Krimelte and the contacts created with two companies immediately turned into co-operation. “Negrao, one of Brazil’s biggest wholesalers of construction materials and Ancora, a producer of fixers that has lately added also construction foams and sealants to its portfolio, both have be-
THE BRAZILIAN MARKET HAS A GOOD OUTLOOK FOR CONSTRUCTION MATERIAL PRODUCERS
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come our partners. Only a few months after the fair, it was clear we would be selling in Brazil! In October 2008, first containers were sent off,” Tarmo says and adds that of course, entering the new market required long intense work days as there is also the time difference to be considered. When Erik Henno who resides in Brazil became Krimelte’s Sales Manager, communication with customers became significantly easier. This year, Wolf Group has found two new partners. Altogether, they now have eight customers in Brazil. Brazil is not accustomed to renovating old buildings. Everything old is demolished and new houses are built instead. That’s why the market is so promising for all construction material producers. Compared to other South American countries, Brazil is the most advanced and prosperous, both financially and business-wise. “If you can make it in Brazil, it’s a good reference to all South American countries. I can be happy with what Wolf Group has achieved on the Brazilian market so far, but I see there is a lot of room for growth,” Tarmo recognizes. Krimelte’s products have become very popular in Brazil and the export turnover has grown since 2010 by almost 20% a year. However, from last year on, the statistics of the Brazilian economy have been modest. The recess on the market started in 2013, when there was no growth. The first half of 2014 has shown a sudden growth, but because of the 8.4% downfall of the construction market in the second quarter, we can’t count on an overall growth.
KRIMELTE’S PRODUCTS HAVE BECOME VERY POPULAR IN BRAZIL AND THE EXPORT TURNOVER HAS GROWN SINCE 2010 BY ALMOST
20% A YEAR
“We have to keep in mind the cultural peculiarities as well. Preparations for the World Cup of football paralyzed the rest of the life and sales were frozen for a couple of months,” Tarmo remarks. Krimelte’s products’ export capacity is around 1.1-1.2 million euros. In South America, personal contacts are very important, but in general, the relationships are loyal. “You never know what to expect when entering the new market, especially if the markets are so far and you don’t exactly know how your product chemistry will work in the local climate. For instance, our product packaging was not suitable for the Brazilian conditions at first and they dried out before even put to use,” Tarmo exemplifies. The Export Manager has only one word to describe the Brazilian market - passionate! “This market has certainly taught us a lot. Most of all – patience, in many variations. It is quite usual that the locals expect us to be fast, but are not so themselves. Plus, you always have to be ready for surprises.” To reinforce their position on the market, in 2013, Wolf Group obtained a 40% partnership in a Brazil-based Estonian production company Elasteq do Brasil Ltda that specializes in production and sales of hydro isolation products. By now, Wolf Group has extended their partnership to 2/3 of the company and as a majority stakeholder is setting higher goals. Elasteq started producing hydro isolation materials in 2012. Wolf Group bought the partnership because Krimelte needed a big base country for its hydro isolation products. The customer relationships created by Krimelte have certainly been of help on marketing
KRIMELTE'S SOUTH-AMERICAN EXPORT MANAGER TARMO NORK
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Elasteq’s products. Brazilians believe in private labels and they don’t embrace new brands easily. Local re-sellers have been participating in the marketing of the products so far, but that’s about to change. When so far Penosil brand has been officially represented by TBR in Brazil, then from January next year, Elasteq Penosil will start selling the brand, so more attention will have to be paid on marketing. The first step is to participate in the biggest construction fair of South Brazil – Feicon, right where the conquering of the market began seven years ago. In the meanwhile, the product portfolio has been improved: in addition to silicones and foams, new cement-based products have been released. In Tarmo’s opinion, the principle opportunity for sales growth is advancing Penosil sales. “It is difficult to say whether the market will grow. Now, we are at a low point, but there is reason for optimism as Brazil is organizing the 2016 Olympic Games and constructions works are in order,” he shares. When Krimelte first started off on the Brazilian market, construction foams were unknown and not in use, so competition was scarce. In 20092010 many construction chemistry producers from all over the world arrived to
ELASTEQ SPECIALISES ON THE PRODUCTION AND SALES OF HYDROISOLATION PRODUCTS the Brazilian market with construction foams, so the situation has changed. Brazilians are very protective about their market, for example, the taxes on most construction chemistry are 14%. Local foams are not of very high quality, but the higher rate of imported material also increases their prices. Yet, if the country would lower the taxes, it would be the end of the local producers. During the last couple of years, competitors haven’t released any new brands and a decrease in competition is notable, also because some weaker producers with lower quality products have disappeared. The greatest challenges
on the Brazilian market are advancing Penosil sales and extending the product portfolio, but also developing sales of Elasteq’s products. “Actually, the sales of construction foams are proportionally small in the construction business, so we want to offer many different products. Luckily, the Brazilian market welcomes innovative products much better than other South American countries. If you’re good, they will come to you,” Tarmo reassures and believes the sales numbers will go up again and return to the 20% growth rate per year soon. 4
PENOSIL IN POLAND Penosil’s distributor Giedrius Saltaise and his team in Poland work hard every day to make Penosil a leading brand among construction foams. Most of the windows sold in Europe are produced in Poland and window installers pay a lot of attention to the quality and price of the products used in window installation. Many Wolf Group’s sales people have learned from Giedrius Saltais how to make a good show out of product training. 4
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2010 PLASTIC PARTS FACTORY FOR OWN USE
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olf Group started producing plastic parts in July 2010. The first product was a cross adaptor and the machinery consisted of three appliances. By now, four machines have been added, plus an extruder or the socalled straw machine. “We bought new appliances, because our machines have to work 24/7 throughout the whole year. Now, we can say that we chose wisely and we have almost no problems with the machines,” Danel Pleiats, the Plastic Production Manager explains. With years, the production list has grown longer, involving, besides cross adaptors, also EasyGun straw triggers, other straws, caps, cleaner sprays for foam department, and silicone cones and cone bottoms for the silicone department. The production capacity is
THE SCULPTURE OF NUN ELSABE First foam sculpture appears in city space. The sculpture of Nun Elsabe from Jüri Kuuskemaa’s legend, designed by Kalju Kivi is exhibited on Nunne street, next to the Estonian State Puppet and Youth Theatre during the festival of Vanalinna Päevad. 4
around 60 million details a year and it all goes to use inside the company. In addition to production, the unit also does some handwork: assembling straw triggers, gluing gloves into caps, etc. The capacity of that kind of work is now 10 million. The plastic production employs nearly 5 machinery operators and 7 packers/assemblers. “We haven’t advertised our product portfolio outside the building, but we’ve
had some ideas about it. We might say that even if our plastic production is young, we are still competent enough to compete with any other plastic production company in quality. Ideally, the sales of plastic details should be as big as to cover all our expenses on the department, so that the details we use for ourselves would be free for us,” Danel reveals some ideas for the future. 4
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2011
WOLVES DO GOOD – PROTECTING THE WEAKER OF THE PACK
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part of being a successful enterprise is participating in charity. In 2010, Wolf Group started active co-operation with the Good Deed Foundation. The first project was to support the work of different organizations dealing with children’s well-being. Between the years 2011-2014, Wolf Group has supported initiatives such as Sina ja Mina Perekeskus (Family Center You and Me) and Oma Pere (Your Family) that are both involved in improving children’s well-being. With the support of Wolf Group and Good Deed Foundation, the NGO Oma Pere was able to work out an entire system to help orphaned children find new families. “It’s incredibly nice to see that since 2013, the government subscribes all public services concerning adoption from Oma Pere,” the executive manager of the Good Deed Foundation, Maris Ojamuru says. Sina ja Mina Family Centre was able to consult a greater number of parents and work towards reaching more families with the Gordon family therapy. Pursuing the guidance of Sina ja Mina Family Centre, the government is starting a similar counseling program for parents. So, Maris believes the family centre’s goal to grow the organizations in their portfolio into strong service providers has been achieved. “Our cooperation continues, but we are focused on new programs, such as the Bully Free School and SPIN, the sport intervention program, to combat bullying and youth crime,” she shares. SPIN is a sports intervention program started this autumn that helps to de-
tonian schools bully-free. Bully Free School (KiVa) is a study program containing both prevention techniques and solutions for existing problems. In 2013-2014, the KiVa program has been implemented in 19 schools and bullying has been monitored in 20 other schools as well.
crease social seclusion among youth and raise community security. The program has been started in Põhja-Tallinn and Lasnamäe where more than 200 youngsters can now do sports with the best young coaches and participate in competitions. All coaches are specially trained athletes from FC Flora and FC Levadia. In 2012, the Anti-Bullying foundation was founded to make Es-
IT’S WORTH MENTIONING THAT THE COMPANY’S MANAGER JAAN PUUSAAG IS A MEMBER OF THE GOOD DEED FOUNDATION’S COUNCIL
Wolf Group has supported the Good Deed Foundation financially and also by sharing their insight and ideas. Maris says Wolf Group is a great example for other companies. The Group’s financial support offers security to the Good Deed Foundation and enables the program managers to fully dedicate to the content of the new initiatives improving children’s well-being. “In the development phase, potential initiatives require a lot of work to construct functioning strategies, financial models, competencies and teams. Thanks to Wolf Group’s support, the Good Deed Foundation has been able to help organizations that greatly influence the well-being of many children and families,” Maris comments. According to the CEO of the Good Deed Foundation, Wolf Group is a partner you can rely on. “We’ve worked together for quite long now, which gives a great deal of security to the Good Deed Foundation – as we can count on their support, it’s easier to plan our activities. It’s worth mentioning that the company’s manager Jaan Puusaag is a member of the Good Deed Foundation’s council. Jaan’s competence, passion and dedication are values that support also the growth and development of our foundation,” Maris believes. 4
WOLF TALES - ANNIVERSARY SPECIAL • 2014 > 31
In co-operation with the The Estonian State Puppet and Youth Theatre, an exhibition of foam sculptures of Estonian culture creators was opened starring characters, such as the singer Georg Ots, ballerina Kaie Kõrb, conductor Tõnu Kaljuste, wrestler Georg Lurich, actress Ita Ever, historian Jüri Kuuskemaa, poet Juhan Viiding and a previous Estonian president Lennart Meri. 4
ENTERPRISE AWARD 2011
DESIGN AWARD
WOLVES OPEN THE MASTER’S CLUB
2012
Want to know how much glue foam it takes to insulate a socket? Why does the silicone sealant become yellow? Since 2012, both home improvement masters holding the silicone gun for the first time and experienced builders can find answers to their questions about construction foams and sealants. The Master’s Club is full of useful articles and educational videos. Newsletter subscribers are the first to know about innovation on the construction field. Be sure to take a look: www.mastersclub.eu
FORCES ARE JOINED WITH STROISISTEMA TO HELP THE PODARI ZHIZNI INITIATIVE “A successful company is not just about good financial results, but also social responsibility. We believe we can make the world a better place,” says Stroisistema’s Purchase Department Manager Natalja Hvoina. And that’s why in 2012-2013, they participated in the
work of Podari Zhizni Foundation created in Russia to help children with cancer. “People should help each other and take care of those who are struggling in difficulties and have nowhere to turn to for help. Our enterprise is successfully growing, so we can afford to donate a part of our income to charity,” Jekaterina Stepanova, Development Manager, accounts. Podari Zhizni was founded in 2006 by actors Tshulpan Hamatova and
Dina Korzun in order to help treatment of oncologic and hematologic diseases. 4
Students of Sculpture and Installation and Jewelry and Blacksmithing at the Estonian Academy of Arts prepare three-dimensional sculpture stars out of Penosil foam, using around 1000 bottles of construction foam. 4
WOLF TALES - ANNIVERSARY SPECIAL • 2014 > 32
2013 2014
2/3 OF THE BRAZILIAN PRODUCTION COMPANY ELASTEQ GO TO WOLVES
WOLVES BUY A COMPANY IN SPAIN WOLF GROUP PURCHASES A 75% PARTNERSHIP IN THE SPANISH COMPANY OLIVÉ QUÍMICA S.A. enter. We’ve now bought our way into that market. Olivé Química is a brand that is well recognized in Western Europe,” Jaan recounts. To increase the Wolf Group’s turnover of construction foams, sealants and glues, the Spanish company’s subsidiaries in Spain, Portugal, France and Great Britain can be used.
T
he deal is beneficial for reinforcing the company’s position in Western Europe and Spanish speaking markets all over the world. Alar Salum comments that buying the majority partnership in Olivé Química S.A. is a historical step and Jaan Puusaag stresses that it has given them access to the much protected Old European markets. “Old Europe is a highly protected market that is very difficult and expensive to
PENOSIL HELPS TO REKINDLE A NOVEL CONTEST
According to Alar, the company’s 40year experience in developing and producing sealants is also very valuable. “I feel there is so much synergy between us, I’m sure that by joining these two companies 1+1 is more than 2,” Alar adds. Olivé is certainly interested in Wolf Group’s polyurethane foams, as they don’t produce these themselves. The 45-year old manager of the Spanish family company Olivé Química, Luis Olivé Paul tells Wolf Tales that he hopes
the merger with Wolf Group will entail a leap in product development and becoming an international force. “My father, also named Luis, founded this company, but he has been retired for a few years by now. He is 72 years old. But you know how the entrepreneurs by heart are – they can never simply sit back,” Luis explains. He says there was no need to sell the partnership. “Keeping in mind the development of the company, it was very important for us to join forces with a professional international company, such as the Wolf Group. Of course, I was doubting and weighing the decision for a very long time, but I sincerely hope that Olivé Química will expand and become an important international company, so we can offer new high quality products to our clients in Spain,” he adds. 4
ROCK’N’HOWL BEER IS PRESENTED TO THE MASSES OF THE CLUB