AN EXPERIENCED and trained labour force and a fast-developing market offering new challenges; but also bureaucracy, incomplete road infrastructure and inflexibility in the labour force. These are a few of the positive as well as negative observations from French investors doing business in Slovakia. The Slovak Spectator spoke to Eric Rouffet, the director general of civil engineering company Eurovia SK, Pierre Chazerain, the director general of the electricity supplier Stredoslovenská Energetika (SSE), Milan Majtán, sales and marketing director of logistics company Gefco Slovakia and Ľubor Vrlák, the director of life insurance and investment funds at AXA in the Czech Republic and Slovakia about their experiences operating in Slovakia, their future plans, and trends and developments in the markets in which they operate.
The Slovak Spectator (TSS): What have been the positive and negative experiences of your company while operating in the Slovak market? Do you think there are any barriers to doing business in Slovakia, or do you have any ideas for improvement?
Eric Rouffet (ER): After 10 years of work and personal experience in Slovakia I can say that our company has managed excellently and relatively easily to establish itself in the Slovak market and adapt to Slovak conditions. I also assess positively the friendly stance of colleagues and clients towards me as a foreigner. The slightly cumbersome bureaucracy, which I encounter very often and whose removal would certainly help revitalise relations within the business environment, is a negative point for me. Another negative feature is incomplete infrastructure, which is a brake on the arrival of further investors.
I see the lower flexibility of workers as something of a barrier. We would prefer a more flexible labour force in Slovakia, one which is more prepared for changes and, primarily, also to accept these changes. But this requires more significant change within the so-called standard forms of employment, i.e. the eight-hour working day, five-day working week and permanent working contract. In other EU countries these forms are more and more often being replaced by other forms of work bound to performance and fulfilment of assignments, which would be interesting for us as a construction company.
Pierre Chazerain (PCh): As a foreign investor, we can see that there are mainly cultural differences in the way business is done, and from the observations we have already made it can be said that, among other positives, there is a strong commitment from employees to their company and their business, a good social climate, which is very important, and also good technical knowledge and expertise.
Regarding the market situation, we see that the market is evolving and is now in the first phase of becoming more liquid, even though liberalisation has already taken place.
Yet following the liberalisation of the market, which we welcomed, we can feel improvement and development, mainly in the quality of services rendered, customer care quality improvement and even growing competition on the liberalised market, and we believe we can contribute to more favourable energy prices for customers. Of course, all this applies to fair competition that is able to ensure electricity supply and customer care from a professional aspect, which is unfortunately not always the rule.
Milan Majtán (MM): The financial and economic crisis has influenced almost every business, but nevertheless this period can be seen as having contributed new business opportunities. Gefco Slovakia has registered a continued increase in its business as well as its economic results. The discovery that more and more companies are searching for a provider of logistics services which is able to guarantee high-quality and complex solutions with added value is positive. Another positive feature is the number of experienced and trained people, for example in project solutions of processes for customers, increasing each year.
I regard still-absent infrastructure as one of the barriers to doing business in Slovakia. Compared with other countries the progress in multimodal transport is slower in railway and air transport and is slowing down activities linked with the arrival of new investors in Slovakia. On the medium-term horizon, it will be interesting to see what the general election will bring, the development of the country itself and where Slovakia’s orientation will be directed.
Ľubor Vrlák (ĽV): Slovakia, like every market, has its positive as well as its negative features. Primarily, it is a dynamically developing market, which is a challenge for us. Growth opportunities and space for realisation of our business activities is an unambiguously positive feature.
TSS: What is your company’s vision for the future?
ER: During the recent period our company registered a significant increase in activities. Our operation has been extended to the whole territory of Slovakia and thus our ambitions are high.
For the time being it is the public sector which is bringing us business since, with the arrival of the crisis, private investments have decreased dramatically. I hope that as soon as the crisis fades, private sector demand will resume and use our experience, knowledge and technologies.
PCh: Regarding our core business, which is distribution and supply, we are already improving our operational performance and distribution network qualities and, last but not least, enriching our portfolio of customer care service and products.
We are actively following the current trends towards renewables (projects already under way include our investments in photovoltaic power, small hydro plants, and biomass), energy efficiency, smart grids (intelligence in the network and interactive exchange of data between producers, distributors and consumers), electric e-mobility (green/electric cars), etc.
A company such as SSE, providing a ‘public service’ and a vital commodity, must be a key player in operating modern technologies, committing itself to maintaining a high level of investment in the future in order to reach within a limited time frame the best quality standards of distributed electricity in the market, while implementing in all its processes principles of sustainable development and social responsibility – and all this while following basic moral and ethical values.
MM: The strategic goal of Gefco Slovakia in the medium term is to grow continuously. Logistics is a segment which has to adapt constantly to the needs of the industry and follow all modern world trends. Our company also wants to extend its activities across the whole territory of Slovakia and in the near feature it plans to open new logistics platforms in Košice and Žilina. We want to offer to our existing as well as to new customers complex logistics services including solutions with added value. Another of our goals is to build multimodal transport. Slovakia is nowadays linked to international routes connecting the east of Europe with the west, and serves as a corridor for penetration into strategic zones such as Russia. Thanks to our extensive network of international branches our customers can focus on their business activities at the international level.
ĽV: The aim of AXA is to become a preferred company for its clients, business partners and employees. We subordinate all our activities to this aim. We want to be successful and create new standards in providing financial services.
TSS: In general, how do you see trends and development in the market in which you operate?
ER: With regards to the development of our market, I firmly believe that working on the improvement of the highway network, without which development of the country is impossible, will continue in Slovakia.
PCh: Several changes have occurred in both the retail and the wholesale market for electricity here in Slovakia. As I said, we are still in an evolving environment regarding electricity supply. We are seeing the ongoing opening of the market and the first residential customers have now had their first experience with alternative suppliers.
To be more specific, based on these experiences, we also see that services and customer care are becoming more and more important for customers – definitely more than in the past. We always rely on this and from the beginning of the market-liberalisation process we have followed this principle by giving the best service to our customers through our contact offices, the call centre and our well-trained people.
Actually, we see a big number of customers coming back to us, missing our good service when compared to their new alternative supplier. This underlines our approach and we continue to increase our services and customer care to reach best in class customer satisfaction.
In B2B, so with industrial customers, we still see the effects of the economic crisis. Here – in dialogue with our customers – we introduced new products and consultancy which gives the customer betteropportunity to act flexibly and to mitigate electricity purchase risks. The positive feedback from our customers shows us that we are on the right path, based on partnership.
In wholesale we see a more and more transparent market, which gives us and the customers the possibility for a transparent and reliable price signal.
MM: As I’ve already said, the trend in logistics will be orientation towards complex solutions, ability to fulfil flexibly the requirements of customers on one hand and on the other hand to bring them alternative or tailor-made solutions. We also foresee the development of multimodal transport, environmental solutions and services with added value.
ĽV: As in every sector, financial services too have felt the impact of the global recession. It has caused a drop in all indicators. From the long-term point of view these are temporary fluctuations. We are convinced that each individual is responsible for his or her future as well as the future of his or her relatives and AXA can help them meet this goal. I can promise on behalf of our company that we will do our utmost to adapt products and services as far as possible to the needs of clients and to be a responsible partner.
The future belongs to products and services which are ‘tailor-made’ and adjust to the changing needs of specific clients.
PCh: Electricité de France, a worldwide and European leader in electricity, entered Stredoslovenská Energetika as a strategic investor on 31 October 2002. Stredoslovenská Energetika and its subsidiaries (SSE-Distribúcia, Elektroenergetické Montáže, SSE-Metrológia, SSE-Výroba, SSE-Project Development, and SSE-Solar) comprise the SSE Group, which now has 1,795 employees and a consolidated turnover of more than €700 million.
MM: Gefco Slovakia was launched on August 31, 2004. As early as in September we started working for the Peugeot car marque, for which we secured distribution and storage of cars. We have obtained a share of the Slovak market also thanks to the fact that we are a member of PSA group, for which we secure complex services – cross docking, monitoring of stocks and ordered goods for both customers and suppliers, distribution of Peugeot and Citroën cars, storage and also customs and tax representation.
We have managed to find in Slovakia experienced employers who want to progress and offer our customers complex solutions with added value. Nowadays our company has 240 employees.
Professionalism in this segment has become a competitive advantage. In general, requirements placed on providers of logistics services have been constantly growing and thus our goal is to offer customers effective and innovative solutions with the aim of searching for possible savings and creation of tailor-made logistics solutions.
ĽV: AXA entered the Slovak market in 2007. In Slovakia it acts in the segment of life and non-life insurance, pension savings (the second and third pillar of the old-age pension scheme) and mutual funds. At the end of the year it will extend its portfolio of services into banking activities.
