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Making Bitter
Prospects Sweet as Honey |
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| In the Russian city of Glazov, 700 miles
northeast of Moscow, an optimist is as hard to find as a well-paying job or a factory
running at full capacity. But optimists do exist, and Constantine Utkin is one of them. Utkin is president of a beekeeping farm called Roy Company, which employs 80 people and cultivates 2,400 bee colonies. In addition to processing and packaging honey, the company specializes in breeding queen bees with a high resistance to desease. But like many businessmen in Russia, Utkin has problems that would seem to leave little ground for hope of success. He has workers he often cannot pay and customers who often cannot pay him. The loans he needs to improve and expand his business are out of the question because interest rates at commercial banks are out of sight. Worst of all, most people in the Glazov region cannot afford the honey he makes because the average salary is a mere $60 per month. So why is Utkin optimistic? The short answer is that he has no time for pessimism. He has too many projects underway. He's building a bakery to expand his product line, he's developing a line of honey-flavored soft drinks, and he's organizing a cooperative with local beekeepers in the region. Utkin is also talking with American firms about a variety of business opportunities, including exporting his honey as well as attracting U.S. investment in Roy Company. All these projects were conceived or developed during two exchange programs in which Utkin participated: the first sent two American beekeeping experts to work with Utkin for two weeks in September 1994; the other, coming shortly after, sent Utkin to the US for three weeks to work with experts in honey processing and cooperative development. Both exchanges were part of the Farmer-to-Farmer Program administered by Winrock International and funded by the U.S. Agency for International Development. For his training, Utkin had requested help in expanding Roy Company's market share. George Scholl and Charles Shipp, both Americans with long experience in beekeeping, visited Utkin and immediately set out to fulfill his request. Scholl and Shipp persuaded Utkin that he must do more to distinguish his honey products from his competitors'. "We were advertising our honey but we couldn't prove that it was better," says Utkin, referring to his recent introduction of honey packaged in single servings." Scholl's and Shipp's answer was to create a difference in the product's content, not just its packaging. Utkin learned the same lesson in the US during the Reverse Farmer-to-Farmer Program, which sent him to Minneapolis to observe honey- processing techniques at Land O'Lakes Inc. It was there that Utkin saw a packaged product containing a biscuit and a single serving of honey. This was just the kind of difference in content he was looking for. He is now building a bakery to make the biscuits and plans to introduce the product in the fall. Another ambition of Utkin's is to organize a cooperative consisting of Roy Company and the many private beekeepers in the region. The united effort will free up money for technological improvements at Roy Company in addition to allowing for a more effective marketing campaign. Local beekeepers have agreed to the idea and Utkin is currently seeking financial assistance from the regional government to help with implementation. "It was necessary to go to America to learn about how to set up a coop," says Utkin. "Land O'Lakes was able to teach us much from their experience." The Farmer-to-Farmer Program gave Roy Company a powerful boost in the two areas it most needed it: development of new products and organization of a cooperative, according to Utkin. "They gave us the direction we needed. Together we solved many of our problems and now I have a better understanding of how to avoid failures." That's why Utkin is an optimist. |
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