Economy

Billionaire Tatyana Bakalchuk and her Russian Amazon competitor

Alexander Shcherbak / TASS via Getty Images

Tatyana Bakalchuk is different from other billionaires. The founder of the Russian online mail order company Wildberries does not live in an expensive villa, but rather, according to Bloomberg Businessweek, for rent in a house outside Moscow. Until 2019, she didn’t even own her own car.

According to the magazine, the trained English teacher and mother of four built her own company at the age of 28 – in her Moscow apartment. She started Wildberries for other mothers with little time to shop. She initially resold clothes from the catalog of the German mail order company Otto online and delivered the orders to her customers’ homes by hand.

Clothing and cosmetics are still part of the main business today. With a net worth, according to Forbes, of 13 billion US dollars, Bakalchuk is now, 17 years later, a multi-billionaire – and still the sole head of her company. According to “Bloomberg”, Wildberries has a market share of 14 percent in Russia, which makes the company the largest online mail order company in the country. It also beats financially strong rivals such as Alibaba or the local technology giant Yandex. Amazon does not operate in Russia due to political tensions and the special logistical challenges of the largest state in terms of area.

Wildberries have been selling in Germany since mid-January

Encouraged by the upswing in the wake of the corona pandemic, Wildberries is now increasingly being launched in the EU: the retailer has also been selling in Germany since mid-January. France, Italy and Spain followed in February. In general, Bakalchuk’s company has repeatedly benefited from crises in its history, as reported by “Bloomberg”. “Thank God there are crises,” Bakalchuk told the magazine.

During the financial crisis in 2008, she bought the excess stocks of global fashion brands and then resold them in Russia. During the collapse of the ruble in 2014, it cooperated more closely with local producers by renting storage space to them and taking over sales and distribution for a commission. As a result, she was able to drastically increase her range. And finally, in the wake of the corona pandemic, sales of wildberries almost doubled, according to “Bloomberg” – to 437 billion rubles, just under six billion US dollars.

Competition with Amazon – strengths through logistics and cooperation with retailers

Bakalchuk told Bloomberg that Amazon’s sales figures astonished her two years ago. L’Oréal, one of their top suppliers, sold 400 times as much on Amazon at the time as on Wildberries. Despite the disillusionment, she is motivated to the financial magazine: “There is still so much to achieve.” And meanwhile L’Oréal only sells 70 times as much on Amazon.

The Russian online mail order company has particular strengths when it comes to cooperating with small sellers. Her marketplace model has increased the number of her partners just as drastically as her range – and the model can be easily transferred to new markets. Wildberries are also strong in logistics, as “Bloomberg” goes on to say, even though the onslaught in the wake of the corona pandemic brought the online shop and the shipping and pick-up logistics to their knees at times. 90 percent of the orders in Russia are sold via pick-up stations where customers can try on clothes and return them directly if they don’t fit.

Bakalchuk wants to continue expanding its range and increasingly focus on electronics, kitchen items and alcoholic beverages, “Bloomberg” continues. She also recently bought a small Moscow bank, as the line between online trading and finance is becoming increasingly blurred. “The race in Russia has only just begun,” she told the magazine.

sb

Tags

Related Articles

Back to top button
Close
Close