BELGRADE. Serbia (ViaNews) – Established in 1996, the Firm Mikromarket is known for its small shops where you can quickly and easily purchase bread, milk, tobacco, and other goods. After nine years in business with only one shop, Mikromarket started to expand and grow. They opened shops on different locations in Novi Sad and also in its surrounding towns such as Rumenka, Futog, Kisac, Sremski Karlovci, Backi Petrovac, Kuplin, Beska, Krcedin, Novi Slankamen, Bukovac, Cenej, Veternik, Cortanovci, Petrovaradin, Budisava, and Kac. Today this company employs more than 700 workers.
How did it start? To know all about it, including the plans for this year and the business situation in Serbia, we talked with Aleksandar Cokorilo director of Mikromarket.
Comparing to the year when your firm was established, how would you describe doing business in Serbia today?
Mikromarket was founded in 1996 and I can say a lot has changed since then. At that time when we opened our business, there were a lot of small shops. Now when we compare it with the situation today, the business situation has changed. It has grown, and it will continue to grow in the future. Before you had thousands of store owners, today we can count them in hundreds. The situation was simple, you either grow or you disappear.
Back then our firm had one shop, today we have more than a hundred. There were some store owners that weren’t so fortunate. Many shops disappeared, and some of them started doing something else. The situation has changed drastically during the 22 years we have been doing business.
Talking about the current business situation in Serbia, what do you believe to be the main challenges and benefits?
Benefits? Honestly, I don’t really know if there are any. As for the challenges, I would say in our branch, but also in the entire economy, domestic companies are discriminated against foreign companies. Foreign investment is being subsidized while for the domestic companies that’s a rare case. This unequal struggle is one of the challenges for which the government needs to find a better solution for.
Do you think the government will be able to treat equally both domestic and foreign companies?
I don’t know. I hope it will, but I really don’t know. There are also a lot of problems at the local level, not everything we fancy can be made into reality. But in my opinion, for foreign businesses everything gets done at a higher level, everything is done quicker and more efficiently. As for us, domestic businesses, we have to start from scratch and we have to fight our way to the top with some technical issues that pose a problem to us; they make us lose our main focus.
How would you compare the domestic market to the region’s market?
To be honest, I don’t know much about it because our firm only does business at a local level in Vojvodina. I would say we’re local players, but I know a little about the market in Croatia and Bosnia and Hercegovina. In Croatia, the market is much bigger than in Serbia. When it comes to Bosnia, I think there are more players on the market than in Serbia. The markets are polarized. You have two or possibly three big players that hold 80% or more of the market. In Serbia this is different. We, small shop owners, hold maybe 50% or a bit more of the market. We still don’t have the same kind of politics the west has. I presume this will change in the future. The 2008 crisis slowed this down a bit. I heard that some small shops were opened in the west too, the difference is that they are opened by those big players. For the sake of faster shopping because people don’t have time.
You mentioned that Mikromarket was founded in 1996, how did it all begin? How did that one store has multiplied into more than 100?
After starting our business, we spent nine years with only one shop. It was a different time then so I finished college I found myself a job. Today the situation is different when it comes to employment, today it’s very difficult to find a job. During that ninth year, they began to open those big supermarkets, I felt that my business is endangered. I realized that if I want to continue what I was doing, I need to expand my business. So we started to open more small shops. At first, we opened two or three in a year and then in time this number grew. Last year we opened 16 new small shops, the year before we opened 31 and so on. That is the economy of scale, the more goods you sell you have better conditions on the market.
Owning just one or two stores is very difficult because you can’t buy at a good low price point and you need to sell high which might mean you end up losing customers.
What are your plans for this year?
We plan to open a few more stores, but our limiting factor is labor power. In other words, we plan to employ more workers. Last year, we reduced the opening of new stores almost in half as compared to 2017. Labor is a serious problem but also an inadequate workforce. Many people decide to go to foreign countries to seek employment. This is a serious problem, we lose workers but also customers. I think this year our main focus will be the quality, we may also close some of our stores.
What is the business philosophy of Mikromarket?
To be a good neighbor to our customers. A place for quick and easy shopping. To continue doing our business.
And finally, do you have any advice for young entrepreneurs?
Honestly, I wouldn’t advise anyone to follow in my footsteps. Don’t get me wrong, I don’t want to sound arrogant. Thinking as I did it so no one else can do it. No, I don’t mean it like that. It is just like I said, the situation now is very different to 22 years ago. When I was starting my business, we were in the transition period, going from one political system into the next. We live in a different era now, instead of trying to open a traditional brick and mortar shop, I believe going online is a good move. Young people today use the Internet and mobile apps for almost everything. So I think it’s better to go directly into online sales and shopping.