Article written by Natalie Mchedlishvili (Georgia Today, 12-03-2010)
Since Georgia is becoming a more and more developed country, society is facing an increasing demand of high quality goods, high fashion brands to wear and high technology equipment.
Georgian agriculture is the most attractive field for investments. According to local consultancy groups, after the global financial crisis and the August war, investors avoid entering the Georgian trade market but they cannot stay away from the agricultural sector.
As a matter of fact, businessmen used to be more interested in fancy and fashionable types of businesses, but for some reason the agriculture is getting one of the most developed and one of the most profitable business activities.
More foreign consulting groups are getting interested in the Georgian economic situation, searching for investors and local partners.
Larive International is a Dutch-based, well-established consulting company with an expertise in assisting Europeans with investing in and trading with emerging markets as well as assisting companies in the developing countries to explore business links with the developed world.
Georgia Today met Davinia Lamme and Wouter van Vliet, senior project managers, to learn more about the company’s cooperation in the Georgian trade market.
According to the representatives, Larive International contacted TBSC, Georgian-based consulting company present on the Georgian market since 2001. Over the past nine years, TBSC has helped nearly 100 organizations to make better decisions including the largest Georgian banks, highly diversified Georgian companies, foreign investors, international financial institutions, the government of Georgia, diplomatic missions, donors and non-governmental organizations.
“The management consulting helps companies to start or expand business in Georgia and our mission is to help western countries to enter emerging markets. So we cooperate with each other to assist Georgian and Dutch business connections. Joint projects can be retail or distribution in Georgia but also it can be establishment of a joint factory,” Lamme told Georgia Today.
TBSC signed an affiliation agreement with Larive International in March 2009.
The partnership provides TBSC with not only access to Larive’s 2 offices in Eastern Europe, the Russian Federation, China and other Asian Pacific countries, but also access to Larive’s long-standing blue chip clients in the Netherlands, Belgium, the UK and Germany.
“Larive has provided local support to hundreds of clients in diverse industries that enabled them to enter emerging markets successfully. We provide local expertise and practical assistance whilst maintaining a Dutch contact point at all times,” Van Vliet said. “We are performing a feasibility studies for several Georgian companies, assisting them to find corresponding foreign partners.”
Cheese production
Currently, the cheese market in Georgia is in its early stages of development and is mainly dominated by farmers with small-scale production. However, consumers start to demand high quality branded and packaged cheese that farmers are not able to supply.
Nowadays, it is a big problem to buy cheese and the only cheese that one can find on the local market will be with unknown quality and wrapped in maximum cellophane. Nobody knows who has produced it how sanitary it is and what’s in it. Meanwhile, cheese is one of the main products. There is a demand because people spend money and buy cheese. The Georgian society is very price-sensitive but incomes are slowly increasing and people want more than just cheese; they want to know whose production they eat. Eco-Food, one of the leading dairy producing companies, noticed the gap and decided to produce Sulguni and Imeruli types of cheese.
“The only problem is that there is no experience and know-how in Georgia on cheese production. Whatever they call factory it is still handicraft goods, which is very far from what is called producing cheese in factory,” stated Nino Vashakidze, Partner of TBSC Consulting. “The only way is to invite corresponding specialists from foreign countries. The demand is so high that the project will definitely be successful.”
Eco-Food has won the Golden Brand for the third time. According to 2008 results, Eco-food was the best dairy products company in Georgia. It is the most stable growing company on the Georgian trade market.
“We and TBSC helped Eco-Food to make a project. We established a group of specialists and we help in terms of business plan to establish cheese production in Georgia on a professional level,” Lamme told Georgia Today.
The work includes market analysis and most importantly technical concept of the optimal production line for Georgian Eco-Food.
“Cheese production is a very interesting issue and we have been thinking to start working in this direction for a long time. The main reason is that the cheese market is very important in milk segment and the most demand goes for factory cheese,” Shalva Alavidze, Head of Marketing Department of Eco-Food told Georgia Today. “Maybe there has been a production of factory cheese in the past, but nowadays the regulations are not followed and according to our foreign consultants the cheese that we get is unacceptable.”
Alavidze said the first stage of the project is the most important and the matter of investor will be under discussion later.
