EBRD and donors help Araz supermarket remain number one in retailing
Azerbaijan is one of the birthplaces of the global oil industry. At the beginning of the last century its wells accounted for half the world’s supply.
But hydrocarbons will not last forever, and a transition to a lower carbon, resource efficient and diversified economy is critical to ensuring a modern and sustainable private sector in the country.
With new concepts, new brands and new outlets, retail has become one of the most dynamic areas of the Azeri economy in the past 10 years.
“We’ve revolutionised the supermarket retail business in Azerbaijan,” said Holger Wagner, CEO of Araz Supermarket, the biggest supermarket chain in the country.
“Until quite recently, people had to visit several small markets to get what they needed. It was inefficient. Now customers can find quality products at a competitive price under just one roof.”
The story of Araz supermarket goes back to 2011 when it opened its first outlet next to Baku’s Azadlig metro station.
Within a short period, it was the leading retail chain in Azerbaijan, thanks to its affordable prices, locally sourced products and high levels of service.
But, as Mr Wagner explained, times change quickly and, despite ongoing success, the company needed to change with them.
To secure its position as number one in the country and to gain an international perspective, the company turned to the EBRD for its advice for small businesses programme.
Through the EBRD’s Early Transition Countries Fund (Canada, Finland, Germany, Ireland, Japan, Korea, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland, Taipei China and the United Kingdom), the Bank provided Araz with the knowledge and expertise it needed to capitalise on the growth of the booming local retail market.
Happy employees, happy customers
Through the EBRD’s Early Transition Countries Fund (Canada, Finland, Germany, Ireland, Japan, Korea, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland, Taipei China and the United Kingdom), the Bank provided Araz with the knowledge and expertise it needed to capitalise even further on the growth of the booming local retail market.
For Araz, the EBRD-led project focused on designing a more effective marketing strategy to distinguish itself from the competition. The project also helped them prepare a business plan, building teamwork, improving quality and design of products and services.
The results speak for themselves: today it operates over 120 stores throughout the country and has introduced a “Spar” franchise as well as a hard discount “Oba” with 700 stores in operation, establishing itself as the indisputable number one in the country.
“I come here every morning to do my daily shopping”, said Leyla Mammadli, a regular costumer. “Vegetables are always fresh, prices are very reasonable and, most importantly, I’m always welcomed with a smile!”
But quality products and low prices are only half of the story. The company is also an exemplary employer in a region where effective Human Resources practices are still slowly adapting to the needs of market economy.
The scholarship scheme for employee’s children to pursue studies is one of the innovative HR policies that Araz supermarket has introduced.
“We understand that companies are reliant on the people who run them: from sales staff to senior management. Our key priority is to create a stable, comfortable, family environment for the employees of the company,” Mr Wagner said.The success of Araz translates into market-driven diversification of the economy and a boost to Azerbaijan’s private sector, both in line with the EBRD’s priorities in the country.
Araz retail is just one example of how the EBRD and its donors are supporting the development of the private sector in a healthy competitive environment, in accordance with international experience.