EBRD and EU assist Ukrainian wine producer in times of war

By Nigina Mirbabaeva

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Читати українською

Vitalii Ukrainets remembers the day Russia invaded Ukraine as clearly as anyone. He was on holiday with his wife, Yuliya, and knew immediately he had to get his mother and two children out of Odesa to safety.

But beyond this, he needed to rethink the future of his Odesa-based wine business, Ambassador Trade.

Vitalii is currently an EBRD client receiving advisory support on marketing his company via digital tools from the Advice for Small Businesses programme in Ukraine, funded by the European Union. The ongoing support has helped him grow his company’s sales and relocate to Europe during the war. The Bank has committed an initial €2 billion resilience package of measures to help citizens, companies and countries affected by the war on Ukraine.

Wine for the times

Vitalii is no newcomer to winemaking. For more than 20 years, he has been supporting the development of the Ukrainian wine market, working with local wine producers to distribute their products at home and abroad. In 2016, partnering with the best winemakers, he founded Ambassador Trade, a trading company that introduced Ukrainians to a new wine concept: boxed wine.

“We wanted to help manufacturers take their products to new levels,” says Vitalii. “In a market as saturated as that of wine, we saw boxed wine as the product that could achieve this.”

In just six years, thanks to the new concept, Ambassador Trade grew in ranking from the 36th wine trader in terms of sales in Ukraine to the 6th, while ranking number one in sales of boxed wine.

With a strong hold on Ukraine, Ambassador Trade set its sights on European markets, and requested advisory support from the EBRD to raise its digital presence. “We understood the importance of digital tools for reaching new customers, and wanted to grow our brand awareness,” explains Vitalii.

Supported by an Odesa-based consultant, Ambassador Trade developed its social media pages, which helped the organisers of the Kyiv Christmas Fair in Kontraktova Square in December 2021 to find the business and invite it to participate. And, thanks to an online tool with e-commerce capabilities developed as part of the project, the company gained substantial new orders from local and European retailers, already achieving to date approximately 25 per cent of last year’s entire annual sales.

And then the war…

“Of course the war has impacted our business in Ukraine,” says Vitalii. “If we usually sell 350-400 tonnes of wine in a given month, in March of this year, we sold only 79 tonnes in the country.” Several of the local producers Vitalii works with have ceased operating due to the conflict, and the speed of delivery has become a problem – whereas before a lorry could reach Kyiv from Odesa in a single day, it now takes five to six days due to fuel shortages and road blockages.

But there is positive news as well. Although intended for local promotion, the company’s new Facebook page also helped a business partner in Austria, Johann Müllner, to discover Vitalii. The two entered discussions to establish a wine trading business in Austria, and when war broke out, Johann –­ now a dear friend – was the first to offer to host Vitalii’s family and assist with business relocation.

But more importantly, Vitalii got his family to safety in Austria.

“It was quite a trek – my mother and children had to cross from Odesa to Romania and then to Bulgaria, while my wife and I had to cross from the Maldives, where we were on holiday, through Poland and Hungary to meet in the middle. But we got there in the end,” he laughs.

While the war in Ukraine continues, the EBRD’s advisory support is delivered online. Vitalii is developing social media campaigns to raise awareness of Ambassador Trade and the products it offers with the aim of attracting new business partners both inside and outside of Ukraine.

A sip of the future

Vitalii is also developing his business in another direction.

“We’ve discovered that there is growth in the canned wine segment and are focusing the new chapter of our business on this area,” he says.

The team have already found local wine producers in Austria and Italy ready to supply the raw product, as well as production facilities to can the wine. They are now in the process of marketing their private label product and setting up their company in European jurisdictions, meaning non-stop fairs, exhibitions and meetings.

And yet, despite the consequences of the war in Ukraine on the business environment, Vitalii has managed to retain his team and continue operations as far as possible, assisting its country through tax payments and supporting local supply chains.

“It’s a difficult time for businesses in our country, but we all have fighting spirits. We know we all need to continue to support business activity and help restore the economy. And I have no doubt that we will prevail.”

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