Amour Club News

Foreign investors? are demonstrating a? broad interest to Ukrainian market of trading estate. The majority of bargains take place due to an active involvement of foreign investment funds. They study thoroughly objects for capital investments, revise the costs and count pay-back periods. The first bargain that evoked noticeable resonance in the capital was purchasing of the main department store called ???Ukraine??? by Irish company ???Queen Group???. According to the words of its president, this was the only first step of their expansion to Ukrainian market. A year later complex ???Ukraine??? turned into the most expensive store of the country. Most rich tenants - the owners of prominent European trademarks, four cinemas, bowling clubs, several restaurants of fast food and multilevel parking for 400 cars occupied this giant five ??“storey building. Irish businessmen plan to invest annually as much as $1 billion into Ukrainian trading estate. The company is especially keen on obtaining logistic storage facilities, office estate and hotels. This year a bargain of selling pavilion ???Globe???, which is also a trading center took place. It was sold to British investment fund ???L&RP???. This was just another proof of existing interest of foreigners to Ukrainian estate. The company realized the potential of Ukrainian market while purchasing Russian assets.

Such international trading operators as ???IKEA???, ???Auchan???, ???Ramstore???, and ???OBI??? do not make a secret of their future entrance to the Ukrainian market of trading estate. Most probably foreign expansion will continue with an increased speed. Foreigners are attracted by impetuous rise of profitability dictated by increased rent rates. This positively reflects on the capitalization of trading estate. The period of payback for trading premises in Ukraine is approximately 5 years, while European is 10 on average. So high popularity can also be explained by yield reduction of trading centers of Western Europe and, what is more, USA.

The market of cottage building experiences a real boom today. ?? noticeable stirring up of investors in this segment can be explained by increased demand for cottage cities. The significant part of citizens does not consider that a flat in the city center is something very prestigious. Citizens are not satisfied with numerous trading centers, large transport streams and therefore constant traffic jams. The price of cottage house is practically the same as the price of the flat in prestigious district in the city.
? The consumer started to pay more attention to out-of-town building which became more moderate in price and is worth alternative for flat. ? People try to change their living styles. They desire to have an own house and lot, breath the fresh air and forget about ???hustling and bustling??? of their cities. On the other had, it has become more difficult for building firms to find free lots within the precincts of a town. The competition becomes tougher, the quality gets better ??“ all this has a positive impact on consumer culture. An attraction of foreign marketing specialists allows applying foreign experience and new technologies. The chaotic out-of-town building will be soon replaced by projects with unified conceptions, developed social infrastructures and other services. More cottages will appear in Odessa region as well. Larger projects may turn into reality thanks to increased incomes, the popularization of cottage building and general public excitement about cottage cities. There is also a threat of mass speculations on this segment. 40% of most liquid houses are bought with the idea of future selling.

Today almost 45% of built cottages could be referred to the business-class and 22% of cottages could be viewed as elite. However, analysts forecast re-orientation of the market. Elite cottages could be less demanded in the future. This happens because the quality doesn??™t match the price today. Most demanded will be those communities that will have developed engineering and social infrastructure. An income of future buyers is estimated on the level above average. The majority will be represented by families those annual incomes increase 300 thousand dollars. However, an increased interest will be demonstrated by middle class and top managers, who are ready to spend 200-250 thousand dollars on their houses. Buyers of elite cottages will remain people with leading positions in large firms, who run their own businesses and those age is approximately 35-50 years.?  Another part of future consumers will be represented by young families, wishing to live in ecologically clean areas. Their age is around 28-40 years. Buyers will pay special attention to such criteria as convenient transport connection with the city, the closeness to the water and correlation between the price and quality. All analysts agree with the point that buildings firms must sharply define their future clients and keep positioning on the market. The most successful firms will offer truly serious and well thought-out projects, which will have good policy of selling. The prices will remain on the same level until people find any other adequate alternative for investments.

The majority of Ukrainian managers note that corporate activities represent a special kind of motivation. Effects of such activities may be noticeable not only inside the company, but outside it in case if activities involved trainings and public actions. ???Corporate leisure also results in the rise of motivation and strengthening of the corporate spirit. In some cases it even brings new clients and increase brand popularity??? ??“ says marketing-manager of Kiev office of international law firm ???DLA Paper??? Natalie Marchenko. From the words of the HR-department director of ???CITIUS??? company it is clear that main tasks of corporate activities are: the development of positive inside relations between colleagues, increasing of self-reliance and reliance in members of own team, development of the ability to make quick decisions and think unconventionally.? 

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Undoubtedly, there are lots of firms celebrating only New Year and 8^th of March. However, the quantity of those which gather not less than 5-7 times a year is increasing. Each year large companies spend more and more money on corporate activities. This expense item in the company??™s budget becomes more important.? Ukrainian company that wishes to celebrate New Year, 8^th of March, its corporate birthday and professional day, as well as gather two times a year for business trainings and 2 times for an active rest, must be ready to spend $80-150 thousand.? 

All corporate activities could be divided into two main categories: business-meetings and corporate holidays. Practically all Ukrainian enterprises arrange both types of events as they purpose differ. Business meetings, conferences and congresses are essential components of every business community, company or fund. Meetings of interested parties represent an excellent possibility to sum up everything, change plans or the strategy, come to an agreement. Most popular business activities are trainings, symposia, business trips, team-buildings. The price of usual training for a company is on average $3 thousands. An average price of business-session is about $4-5 thousands. The workers of above-mentioned company ???DLA Paper??? attend special course of English. Each worker can also visit 1 or 2 trainings abroad annually in order to raise qualification or to broaden contacts.? 

The best way to relax after hard project is to organize a corporate party, visit a bowling-club, to arrange some kind of corporate holiday and entertainment. Such amusements are even more popular in Ukraine than business-meetings. It is worth to mention that their price is higher (from $2 thousands to $40 thousands).? 

Here are prices on different types of corporate activities (an average price for one person):? 

Training abroad - $500-1000? 

Corporate training - $70-250? 

Team-building - $20-150? 

Corporate banquet - $50-150? 

Outdoor corporate holiday - $300-800? 

Corporate picnic - $5-30? 

As we can see in Ukraine are popular almost every kind of corporate gatherings. The choice depends on company??™s age, specialization, an average age of its workers. Organizers should think of every detail and avoid turning corporate leisure into banal ???booze-up???. They must answer questions: what is the aim of gathering, for whom is it held and which sum of money is acceptable for firm.? 

Ukrainian shipbuilding facilities only start today overcoming a crisis. The impulsive force for such development introduced orders from abroad and purchasing of Ukrainian factories by foreign companies.? 

American cruise company ???Celebrity Cruises??? earns milliards of dollars holding giant liners ???Millennium???. These ships were included in company??™s fleet at the end of 90-ties. Due to them American organizer of popular round-the-world voyages at a moment’s notice took leading positions on the market. Unfortunately, Ukraine doesn??™t have such orders for shipbuilding today. Though, the only building of one similar hull at least, would afford our shipbuilders to overcome crisis and reach good level of profitability needed for the further well-being. Meanwhile, Ukrainian shipbuilding facilities are obliged to stay content with the orders from Dutch and Belgian companies. Most often they envisage building middle-size ship hulls. Of course, such projects had saved the branch from decline earlier. But now our branch is looking for new sources of funding and more serious projects.? 

Ukrainian shipbuilding has huge potential. Before 90-ties the ship production of the USSR was quite successful. If we would like to operate with facts, Soviet shipbuilding enterprises were supplying the world with one third of military and civil ships. Our country inherited this mighty basis for production, but unfortunately was incapable to use it. The branch had experienced series of misfortunes in 1991, which resulted in drastic collapse of production and numerous bankruptcies. The main reason of crisis was minimization of orders made by state (main source of funding earlier). The rebirth of branch had started only at the beginning of the century thanks to two interrelated factors: the privatization and foreign orders for shipbuilding. The biggest foreign customers who signed contracts with Ukrainian shipyards are ???Damen Shipyard Group???, ???INDA???, ???Dof Industry AS???, and ???Ulstein???.? 

Today Ukrainian flagships of domestic shipbuilding must solve hard tasks. We can understand the nature of these problems better if we look on the work of ???Black Sea shipbuilding plant???. The new management of the company is ready to start everything afresh reviving production powers of enterprise that were almost buried by the previous owners. The factory stopped its existence as a valuable shipbuilding company under their control or better to say in conditions of the lack of any control. Because of this, the shipbuilding objects are now in a sad state and enterprise is working on the verge of its abilities. The only margin of safety remained since Soviet times and efforts of work collective had finally prevented the factory from the quick destruction. However, present managers believe that the current situation is far from catastrophic and assure that it is still possible to win international recognition in case of rapid modernization and large investments. The mill had already hired 1200 workers, and the process of recruitment continues. Though, new top-management understands that is only the first step. Workers do need worth conditions for life like road networks, infant schools for kids, conditions for cultural leisure, etc. And it is not a question of charity, but business practice. Each worker must feel protection, the same as his family. New management is looking for orders. The enterprise works in partnership with foreign company ???Blue marine limited???. Long-term plans are quite ambitious: an entry on international market and to the world shipbuilding holding. It is realistic goals as an enterprise is familiar with technologies of trawlers and barges production. Nowadays, according to press, they are searching potential financial partners both among profile companies and portfolio investors.
According to expert’s views, there are three main reasons why foreign customers started to give preference to Ukrainian shipbuilding facilities. Firstly, we have cheap working forces with substantial share of qualified specialists. Secondly, Ukraine produces its own steel needed for the shipbuilding. Thirdly, during last years the world center of international shipbuilding has shifted from East to West. European shipwrighters hold only 13% of the world production today; other share of 67% is in the hands of producers from Japan, China and Southern Korea. These countries have one vital benefit -they are granted strong state support: low tax rates for imported equipment and raw materials. It allows them to make orders in time and supply clients with production quickly. Analytics also mention that because of the branch boom, Asian shipyards are overloaded. And that is the reason why foreigners are forced to search free facilities and develop them, as in the case of our country, at their own expenses. Some large world leaders are trying to conquer the East. For them Ukraine is ready to became a bridge between two shipbuilding civilizations.

The sea food ??“ is a favourite food for the majority of Ukrainian oligarchs and politicians. Not only theirs, though. There are plenty of worshippers of sea dishes. During last few years a real sushi-boom can be observed in the country. Today restaurants of Japanese food gained a wide popularity among Ukrainians. The consumption of sea gifts has noticeably risen. Ukrainian market of sea dishes is one of continually growing among other markets of foodstuff. An import is expected to increase by 30-40%.? 

There are few explanations for such increased demand. The first one - is the partial legalization of the market. Only 2 years before, around 40% of the market was shadowed. Now it is almost completely legalized. The sea food is not something exotic yet. Such rise of appetite analytics explain by growing incomes of population. Especially fast-growing can be considered the segment of sea delicacies, represented by octopuses, squids, mussels ant other range of unfamiliar to ordinary consumer sea creatures. Even in spite of expensiveness, sea dishes become almost day-to-day products for people, those incomes are above average. The popularity can also be explained by ???infatuation??? for healthy lifestyle. This reflects on the consumers??™ choice. People try to eat healthy food, containing vitamins and that is, sometimes, dietetic. However, such choice can afford not everyone. By the way, scientist had found out that while eating sea food our organism produces a special amino acid that fights with a bad mood.? 

The domestic sea production makes up only 10% of total market. The major share of imported sea gifts comes from Norway. This Nordic country satisfies 75% of our needs. The rest of production is being imported from China, Peru, Russia, Chili and New Zealand.? 

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Local retailers already know the answer to that question; international entrants that plan to join them must also understand Ukrainians??™ unique needs and behaviors.
In Ukraine people are less brand conscious price sensitive than their western counterparts. They tend to buy their vegetables, fruits, meat and milk from private seller that can sell for less. Ukrainians tend to focus on price more that convenience. As a result, well-known local goods continue to dominate the marketplace, with about 80 percent of all products sold domestically. Local retailers are beginning to recognize the value of the brand, however, and are creating their own advertising campaigns as a result. With more advertising, customers of modern format stores seem to be paying more attention to brands and quality of products. The process is slow, but it does give foreign retailers a foundation from which to begin building the presence.
The Russian network ???Okay??? had finally obtained a legal right to develop its business in Ukraine. Now it aims to apply an aggressive strategy on Ukrainian market. There is no other way out, as it must catch up with Ukrainian strong players. The undisputed leader of Ukrainian market is the network ???Silpo???, holding more than 120 supermarkets. Coming from the same group ???Fozzy???, the network ???Fora??? contains 70 shops. Another network ???Furshet??? consists of 80. This autumn will appear the first supermarket of the ???Okay??? group. The company is going to run 25 supermarkets till 2011. The commercial manager of ???Okay??? Armen Papazyan tells about Ukrainians??™ consumer needs:
???Our company is making research of consumer preferences and already has first results. Ukrainians tend to eat well. ? They prefer pickings, sweet stuff, meat, and fish mostly. An indispensable condition for good sales should be a diversity of choice. Another finding - Ukrainians can??™t live without bred. Surprisingly, but there almost none high-quality bred that would come from the stove to the shops. Most likely, some technological problems exist. We would like to change this??? He also shares his thoughts about the future supermarket strategy: ???We would pay special attention to home goods. Such decision is connected with the current building boom and constant striving of Ukrainians for repairing of their premises. Considering the fact that healthy lifestyle is becoming more and more popular, we are also ready to trade with goods for an active pastime. The general conception is to gather everything that is possible under the single roof. Though, we are not going to compete with particularized shops. They should remain in the category of professionals.??? The purpose of ???Okay??? in Ukraine is to create such atmosphere, that consumer spending his money and time in the shop, would think of coming back to the shop again. This also means that he should find the products to which he is used. The management of ???Okay??? grants for this reason that 30% of total assortment will be supplied by local sellers.

One very popular Ukrainian politician had invented a method of how government officials can rid of traffic jams. Premier Viktor Yanukovich is going to propose his colleagues to forget car seats and starting using helicopters. The same interest to flying was also demonstrated by the head of Emergency control ministry Nestor Shufrich during summer. However, his interest has other roots. It may be explained by the often summer fires caused by the drought. The rare person, who had finished courses of pilotage and now actively uses helicopter is famous Ukrainian racer and ex-minister of transport Eugeniy Chervonenko. The governor could be noticed flying in the red French helicopter of ???Gazelle??? brand. He says: ???Sometimes I fly to Kiyiv from Zaporiggya using a helicopter. This takes only two hours and a half. Additional time is occupied by the trip to an airport and registration procedures.???
? A private aviation ??“ is something completely new for Ukrainians. First helicopters were bought only few years before as an alternative to airplanes. Helicopters are more expensive, but easier in use. These flying machines can board not only on an aerodrome, but also on the office roof or simply the lawn. That is why helicopter romance has finally attracted our Ukrainian businessmen. ???Helicopters are usually bought for work goals???, - says the director of club ???Autopilot??? Andrew Omelchuk. According to him, 25 helicopters were delivered to Ukraine during the last year. Aviation is especially popular in Dnipropetrovsk. During 2006 eight French helicopters ???Gazelle SA341??? and six American ???Robinson R44??? were bought.
? It is not very easy to buy helicopter in Ukraine. The machines are usually imported from abroad. Ukraine doesn??™t produce helicopters, apart from one model ???AK-1???. This model can be referred to ???light??? class and costs around 150 thousand dollars. The most moderate helicopter is ???Robinson???. It costs 250 thousand dollars. But it needs special fuel, which can??™t be bought in Ukraine. That??™s why ???Eurocopters??? are highly demanded instead (such technique cost 1,5 ??“ 2 million dollars). Ukrainian helicopter market stays in shadow. There are no official saloons, representative offices or official dialers. However, the amenity of using helicopter is obvious: the high speed, no problems with traffic jams, very small ground for landing. That is why helicopters are usually chosen by people, who demand practicality and functionality and have money of course. Such people are real experts of comfort. Today helicopters are actively used in other world as aero taxies and are also helpful during various excursions. It can be forecasted that the demand for helicopters will rise in the future, taking into account the problem of numerous jams in all main cities.

Here are some facts that will be interesting to helicopter amateurs:
?·? ? ? ? ? ? ?  the registration takes place in State avian service of Ukraine and lasts 1-2 months
?·? ? ? ? ? ? ?  it is permitted to fly everywhere, except of above electro stations, strategic and military facilities
?·? ? ? ? ? ? ?  value added tax is 20%
?·? ? ? ? ? ? ?  the theory costs 1000$ per hour and practice ??“ 300$ per hour