VILNIUS - Snaige last week announced its official entry into the Russian market by offering consumers an unprecedented 10-year warranty. The Alytus-based company said that it would aim to win a 20 percent market share in the rapidly growing Eastern country over the next two years.
"We believe that Snaige may become one of the leading brands on Russia's refrigerator market. The mid-price segment is rising fast, and we are able to offer Russia's consumers products of European standards," said Sergei Butenka, a Snaige sales director.
Russia's refrigerator market has the potential to grow by at least one-tenth per year company, expert estimations have shown. Snaige, which currently holds a mere 1.5 percent of the market, has been boosting its sales on the neighboring market fast. Sales surged by approximately 90 percent over the past two months.
Executive management said the company could compete on the Russian market successfully, since it now had production facilities in Kaliningrad and could save on shipment costs. Investments in the plant, which opened in March, amounted to some $18 million.
In accordance with its aggressive marketing policy, Snaige has been expanding the office network in Moscow and other dynamic Russian regions. The company has pledged to earmark some $1.5 million for its upcoming advertising campaign to promote refrigerator sales with 10-year warranties.
In other news, the company reported revenues of 258.7 million litas (75 million euros) for the first 10 months of 2004, a rise of 8.7 percent year-on-year. Unit sales, meanwhile, firmed by 4.3 percent year-on-year to 378,300.
For full 2004, Snaige is projecting pretax earnings of 34 million litas on sales of approximately 300 million litas.
Established back in 1963, Snaige launched exports of refrigerators in 1983. In 1997, the company obtained a European quality certificate. In 2002, the company established a subsidiary, General Frost, in Slovakia, which produces refrigerators with the same brand.
The list of Snaige's shareholders includes the investment company Hermis Capital with a 40 percent holding, Scandinavia's investment funds Amber Trust, and East Capital, with stakes of 30 percent and 5 percent respectively, according to the Baltic News Service. The remaining 25 percent are floated on the market.
Last month shareholders selected Mindaugas Sestokas, former marketing director of Svyturys-Utenos Alus, as the company's new executive director for part of its strategic expansion plans.
Giedrius Barysas, general manager and chairman of the board, confirmed that Sestokas could succeed him as general manager in several months' time. Barysas, who has headed Snaige since last spring, is to become chief executive of the whole group of companies owned by Snaige, including the refrigerator plants in Alytus and Kaliningrad, and an electric-and gas-cooker plant that Snaige is planning to open in Russia.
Sestokas, 32, has worked for Svyturys-Utenos Alus, Lithuania's number-one beer producer in terms of sales, for seven years.