CHERBROOKE: abnormal heat for us means a pleasant surprise, however, our success does not depend on weather

In the very heat of the hot summer season we were lucky enough to talk with Alexey Shabliy, General Director of Cherbrooke company. He takes a philosophical approach to the present that the abnormal heat made to our industry and this is probably why we were mostly talking about business development and the future than about the fortune of this summer.

Please, tell us what is your company like now? What are the main fields of its activity?

- Presently Cherbrooke is one of the largest suppliers and manufacturers of air-conditioning and ventilation equipment at the Russian market. We are engaged in distribution and servicing of air conditioners by Panasonic, Hitachi, LG, Samsung, Ferolli, ventilation systems by Obsberg, DEC and a number of other European and Asian brands. Besides, our company supplies a wide range of consumables and accessories for installation.

For three years by now we’ve been developing and promoting at the market our own trademarks: Aeronik (air conditioners, fan coils, air curtains, convectors, and other HVAC equipment), and Venttorg VT (air handling units, channel fans, heaters, water and freon chilling units). The equipment under those brands is made at our own production facilities, and under special orders at enterprises in China, Russia, and CIS countries.

It is a new stage in the development of Cherbrooke which was preceded by seventeen years of operation in the industry, establishment of relationships with leading foreign and domestic manufacturers, as well as of learning needs and specifics of the Russian HVAC market. From the Chinese, we picked up flexibility and capability of adopting promptly the best, while from the Europeans we learned punctuality, stability, high quality standard, and ultimate transparency of business processes. As a result of that, the share of in-house manufacture equipment in the overall turnover is increasing at a swift rate.

We created a wide dealer and branch network with wholesale warehouses in largest cities of Russia, which allows us to make the most share of our range of products available within the shortest terms.

Did the economic crisis cause any adjustments in Cherbrooke’s operation?

- Due to the crisis we had to carry over from 2009 to 2010 the start of supplies to Russia of semi-industrial air conditioners and Aeronik VRF systems. As a result, the SMEs’ deferred demand for those systems and the extremely hot summer multiplied by the confidence in our brand made those products a success at the market.

In the heat of the crisis we were not sitting on our hands; instead, we, taking advantage of the price decrease, were purchasing new equipment, manufacture and warehouse facilities. We were fine-tuning our processes and solving staff issues. During 2009, we mastered mass production of PUMA air handling units, rectangular duct fans with Ziehl-Abegg power-wheels, hot-water calorifers, water and freon cooling units, regulating stations, and many other elements of ventilation systems.

We became one of the first air-conditioning companies with high potential in the field of ventilation equipment. In-house manufacture of a wide range of fans, air handling units and other equipment is a distinctive feature of ours. So, in general, we consider that period a rather successful one. Of course, we still have many unsolved tasks, but this cannot be related exclusively to the crisis.

– So, how are you doing in the season of 2010? What are your forecasts regarding your company and the market as a whole?

- This season features heat and commodity deficiency. Despite the fact that the employees of our company work their heads off every day, customers still have to wait in queues for hours. During past years people got accustomed to the fact that dealers always have everything, that any equipment can be purchased on credit; thereat, companies working with end-users don’t even have to have a small warehouse. Many intermediary companies went bankrupt during the crisis years, and commercial networks made small orders or even did not supply equipment at all.

The demand is likely to DROP by the end of the year. New batches of goods of leading brands will arrive and need be sold urgently. As usually, professional distributor companies will save the situation by purchasing this equipment. Due to the anticipated demand in 2011, sales season will start earlier, than in 2010. The penetration of Chinese brands and OEM-brands will increase, as well as the share of R410a-based domestic and semi-industrial equipment, including VRF-systems. Prices will grow up, however, their proportion will remain unchanged.

As to our company, this autumn we expect a strong increase of demand for Aeronik VRF-systems. Those are modular systems using the advanced inverter technology. Their outdoor and indoor units are delivered from a warehouse in Moscow. Besides, the advantages of that equipment are attractive price, three-year warranty, and service support.

In autumn and winter, we intend to hold workshops devoted to air conditioners and ventilation equipment of our own manufacture on the basis of our branches in a number of regions of Russia.

For winter, we prepared an updated range of Aeronik air curtains, fan heaters, convectors and VT packaged air curtains. We were very enthusiastic about air curtain verification project on the basis of APIC. Participation in this programme will allow us to obtain a documented proof of all the advantages of our products.

By the next season our company is preparing a wider range of new-generation Aeronik air conditioners. That equipment will be available even this year; its features and advantages will be promoted at Climate World-2011 exhibition.

- Is your company successful in reaching the goals set for this season?

- Everything that had been planned was done and we already know what we will do next year. The current season with its abnormal head is a present, good luck. However, in our business we depend not on luck; our success is based on more stable things.

2008 was a record year for many companies in terms of sales. During seven months of 2010, our sales have already exceeded the by-now largest sales volume registered in 2008. So, by the end of the year we are going to exceed the record figures by at least 15-20%. The issue of profitability is more complex: some not very pleasant adjustments are caused by exchange rate fluctuations, low profitability of import due to the changes in the structure of the Russian market of air conditioners.

- Who are your customers? How do you attract them?

- Our constant customers are more than 1500 companies all over Russia. In the conditions of the settled market, the customers are, in the first place, attracted by service quality and stability.

We are not the only ones who can offer attractive prices, goods availability, high quality of services, thoughtful logistics, credit facilities, and other things. This is why we not only try to make cooperation comfortable to the maximum extent possible, but also to become some kind of a center that unifies professional companies.

Many of our partners are personally familiar with the administration of Cherbrooke. We strive for keeping live contact and being loyal to our customers to the maximum extent possible. Besides, we constantly organize various events and pay attention to details and technologies which can attract customers’ attention to our goods. As a consequence of those efforts, it is more convenient for our customers to build their business on the basis of our range of products.

- How do you select business partners?

- We communicate intensely with companies and people within our industry. The most important quality for starting cooperation is honesty and great desire to work.

If we see any potential in a start-up company, we try to help it take start and avoid most common mistakes.

We consider it a great achievement if some well-known company starts cooperating with us. For that, we have to adjust our activities to match interests of a potential partner, to improve or change some things. It takes years in some cases.

Of course, being flexible, we do not make deals which may harm our strategic partners or have an adverse effect on the market as a whole.

- What is your competitive advantage?

- We don’t have many competitors; however, those that exist are, like we, leaders in the industry. This is why we cannot stay still, we have to move on devising and exploring new ways to develop our business. Our main advantage is our range of products many distributors and manufacturers are unlikely to offer.

Thus, during the crisis, we started manufacturing premium-class models of Aeronik room air conditioners. According to our partners, those became an actual hit of the past season.

Moreover, we offer last-generation Aeronik semi-industrial systems and VRF systems at special prices.

In 2011 we will make something else up.

- What are your forecasts, plans, and tasks for the next year?

- Next year we plan to double sales of Aeronik equipment. We also plan to pay special attention to the promoting PUMA fans and air handling units by VT at the Russian market. For that, we intend to deliver those not only to Moscow market, but also to regional warehouses, we will perform large-scale advertising campaign at Climate World-2011 and in media.

To solve the set tasks, we expand our warehouse facilities and improve the customer service system.

Even if next year there is the same extreme heat, it will have no effect on the quality of our work with customers.

- Thank you very much for the interview!

- Thank you too. I wish to all market players stable business and nice weather!