LogyCom Has Been Developing a Retail Chain
LogyCom has been operating in the IT market for the past 14 years, and is a major producer of computers in Central Asia. In the previous issue we discussed that a key component of LogyCom's success was their production system processes which are unique in the domestic IT market. At the same time, it is not enough just to make a product, but there should also be an effective system to sell it. Considering this, it is not surprising that another cornerstone of LogyCom's strategy is to develop its own retail chain. The commercial director of the company's retail chain, Yevgeniy Kudryavtsev, has told us about the company's priorities in this sphere and the reasons for significant growth in the number of shops.
Mr Kudryavtsev, let us start our conversation with a discussion about the development of your company's retail chain.
LogyCom opened its first retail shop in Almaty in 1995 when the IT market was not yet very well developed. Soon after, with growing consumer demand for computers we opened another shop. Later, to make it convenient for our clients we decided to gradually "cover" all the zones of the southern capital with our shops and a further two shops were opened in Almaty. Thus, we launched a programme to develop our retail chain. At the moment LogyCom retail outlets are located almost in all parts of the city and this, of course, has a favourable impact on our reputation among our clients. In addition, all the shops have a practically identical range of products which means that clients can buy everything they need in a place that is convenient for them.
After we opened five LogyCom retail outlets in Almaty, we started to enter regional markets. First we opened a shop in Astana and then within six months we opened five shops at once in Uralsk, Aktobe, Kostanay, Shymkent and Karaganda. We also opened a retail outlet in Pavlodar in 2003. Despite the transport costs, we have kept regional prices almost the same as Almaty prices to benefit our clients by meeting them halfway.
How many shops does your retail chain have now?
Over the past two years alone, we have opened a further 17 LogyCom shops. This means that the company has 29 retail outlets in the country at the moment: nine in Almaty and 20 in the regions. Through these stores we have covered all the major Kazakh towns. That is why we can say with confidence that LogyCom has the largest IT retail chain in the country. And this is true even though many towns in Kazakhstan are far from being major cities but some of them have significant customer demand. These towns have already got two shops each, mainly in different parts of town.
What are priorities of LogyCom retail outlets?
The main task, of course, is to satisfy consumer demand to the maximum extent possible. In particular, we are trying to select a range of products that means that both beginners and professionals can buy everything they need in our shops. For example, the computers currently offered in LogyCom shops are designed for three main groups – for children and adults (who have never used computers), home computers (to play games on, watch films on and use programs and applications) and a super powerful line for professionals. A similar approach is pursued for peripheral devices.
Another priority is to constantly monitor the changes on the market and the emergence of new technological solutions. This is why despite the rapid change in IT generations, our clients can always find the latest products in our shops.
The third important task, in my opinion, is to offer quality, professional and convenient services. Don't you agree that it is pleasant to come to a shop and see smiling and polite sales consultants who are able to tell you in detail about each model and their technical specifications and help you make the right choice? For these purposes LogyCom has set up a special training centre where all the staff members of the company's retail chain undergo not only technical training but also acquire the skills they need to have informed discussions with our clients. Competition is quite tough in the IT market, and that is why treating clients right is a key factor for success. Different companies often offer the same product but they offer it absolutely differently. Naturally, the winner is the one who manages to present their product in the best way.
One further aim which we have already started working to achieve is to set up service centres in all the shops in the regions. This will enable clients to not only buy products from us but also receive quick and, importantly, smart services for their equipment. Isn't it the case that all these components are a significant factor for the long and faultless functioning of any equipment purchased?
What is your assessment of the current level of development of the retail segment of the Kazakh IT market? How do you see its future?
The IT market is developing rapidly at the moment, I would even say stunningly. The trend of constantly falling prices for digital equipment makes a PC affordable for the majority of users with average incomes. By buying a PC people receive a powerful instrument for their self-development. Internet access enables them to collect a lot of information, including on IT. Consequently, with the improvement of knowledge there is a need for better equipment. In the near future this process will not slow down but accelerate further. This means that newer models and faster solutions will appear on our market, and this will expand the capabilities of computers and, consequently, users. We, for our part, will do everything possible to satisfy the growing demand from our clients.
I would like to point to the great prospects opening up in the public sector because equipment operated by many government structures has become obsolete and is failing to solve tasks set efficiently and so it should be modernised.
Could you please tell us about the plans adopted by the LogyCom retail chain for the future?
Growing demand for computers makes it possible for us to plan to expand our chain further. By the end of 2006, we intend to open a further six shops to increase the total number of retail outlets to 35. Bearing in mind the tough competition, we, as in the past, will pursue a balanced pricing policy but also aim to offer as wide as possible range of products. LogyCom's focus on our clients will remain unchanged because this is the main reason the products we offer are in demand.
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