09.06.2017

Ulmart leads discussion on benefits and risks of Internet of Things at SPIEF 2017

June 2017, 09.

Ulmart has brought together a number of top international and Russian experts at the St. Petersburg International Economic Forum (SPIEF) to discuss ways of how to make the Internet of Things (IoT), one of the hottest concepts of today’s tech world, work effectively for the benefit of all market participants.    

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Ulmart leads discussion on benefits and risks of Internet of Things at SPIEF 2017

June 2017, 09.

Ulmart leads discussion on benefits and risks of Internet of Things at SPIEF 2017

Consumer education is key to success

09.06.2017 – Ulmart, Russia’s leading online retailer, has brought together a number of top international and Russian experts at the St. Petersburg International Economic Forum (SPIEF) to discuss ways of how to make the Internet of Things (IoT), one of the hottest concepts of today’s tech world, work effectively for the benefit of all market participants.   

The panellists of ‘Internet of Things: Overcoming Obstacles’, a designated session organised by Ulmart and the Roscongress Foundation and moderated by Mike Butcher, Editor-at-Large of TechCrunch, agreed that the interconnection of products will soon become an integral part of our daily lives and the global economy.  However, they admitted that there are a number of obstacles that may prevent the Internet of Things from flourishing and benefiting the consumer and businesses alike.  

Opportunities:

Dmitry Kostygin, Chairman of the Board of Directors of Ulmart, commented: “It is no doubt that the Internet of Things is the future, with its own risks and benefits. We can call the concept the ‘Things of Internet’ as fewer and fewer items remain non-digitalized nowadays.  Ulmart as one of the pioneers of the digital revolution in Russia and a market leader in the country’s e-commerce sector understands that with vast opportunity comes strict responsibility. Technology is evolving faster than any legal and moral frameworks that would be required to manage it, and we need to be able to use Big Data and other tools effectively to protect the consumer while focusing on further growth potential.”

“In ten years the Internet of Things may create a market that would be the size of China’s economy, with the commercial segment accounting for two thirds of its value.” said Vladimir Cernavskis, Partner, Head of Telecom, Media and Technology Practice in Russia, McKinsey & Company. 

“The Internet of Things is much more than just the communication of things. It combines technology and platforms that ensure the collection and storage of information. It is realistic to develop the Internet of Things without waiting for a specific standard to be developed, simply by adjusting technology to customer needs,” said Andrey Kuzyaev, President and Chairman of the Management Board, Member of the Board of Directors, ER-Telecom Holding.

"Devices are fast and smart, and artificial intelligence is developing quickly, so it is possible that devices will create their own protocol and language,” commented Mark Gazit, CEO of ThetaRay.

Obstacles:

Cybersecurity, regulation and lack of consumer education were named the key challenges for the successful growth of the IoT.  A number of technological and operational barriers will also need to be eliminated to ensure smooth integration and interconnection of things, according to the panelists.

“People use the Internet, social media and electronic payment systems without the fear of a hacker attack because the opportunities are often greater than the risks. It is important to start educating people about cybersecurity. When devices start talking to each other, the vulnerability is not in the devices, it's with the human beings that use them,” noted Mike Butcher.

The moral and legal issues revolving around the IoT perhaps don't seem so obvious today, in 2017, but in the next five-seven years we will be so deep into the IoT that it will be too late to act. We must at least begin now by asking these questions," commented Brian Kean, Chief International Officer of Ulmart.

“There are issues related to the security of data, cyberattacks and privacy of communication, while the consumer is not necessarily informed of potential risks,” said Irmgard Glasmacher, Managing Director, Lead of Accenture Strategy in Middle East, Africa, Russia, Turkey.

“It is important to be able to properly analyze and use Big Data, as well as ensuring the technical compatibility of devices to develop the full potential of the Internet of Things,” commented Vladimir Cernavskis. “Devices need to be able to speak the same language with each other.”

“As a user of Internet systems, I provide my data to such systems and am no longer able to control it. People need to be educated about cybersecurity and new technology as early as at school,” said Sven Wagenknecht, Editor-in-Chief, BTC-ECHO.

“I believe that only evolution will help provide an adequate level of cybersecurity,” said Andrey Kuzyaev. “Excessive regulation can stop the Internet of Things from developing, therefore ensuring proper balance between security and progress is key. Humans and computers need to be trained to communicate effectively with each other.”

24.05.2017

The Internet of Things: Ulmart proposes honest oversight

May 2017, 24.

Ulmart, Russia’s leading online retailer, plans to tackle the moral and legal issues surrounding the Internet of Things (IoT) at the dedicated session “The Internet of Things: Overcoming Obstacles” to be held at the upcoming St. Petersburg International Economic Forum (SPIEF) on June 1, 2017.

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The Internet of Things: Ulmart proposes honest oversight

May 2017, 24.

Ulmart, Russia’s leading online retailer, plans to tackle the moral and legal issues surrounding the Internet of Things (IoT) at the dedicated session “The Internet of Things: Overcoming Obstacles” to be held at the upcoming St. Petersburg International Economic Forum (SPIEF) on June 1, 2017.

Invited by Rosongress Foundation, Ulmart decided to take the lead on one of the hottest issues in tech today.  Moderated by Mike Butcher, Editor-at-Large of TechCrunch, the session will challenge the panel of international and Russian experts to weigh in on this latest consumer revolution. The panellists will debate on whether manufacturers, retailers and governments should be responsible for sparing citizens from constantly being followed, monitored and analyzed solely to increase profit, as well as addressing other important aspects of  IoT.

Currently, GPS locators and many smartphone applications require the user to ‘agree’ to be linked in. 

It is estimated that by 2025 one trillion products will be “communicating” with each other.  As a result, a figurative matrix will surround consumers 24/7 and they will not even know that they are at the center of the virtual conversation. 

“As a retailer striving each day to use big data to increase sales, I realize just how easy it may be to abuse the growing network of interconnected products that surround us in every facet of our lives,” remarked Dmitry Kostygin, Chairman of the Board of Directors of Ulmart.

 “Imagine every day 'speaking' to hundreds of products, ‘telling’ them: “Yes, pillow, no, socks, behave yourself refrigerator,” commented Brian Kean, Ulmart's Chief International Officer. “None of us has time for the daily oversight of the ‘conversation’ with products but unscrupulous companies could abuse this trust. As the first online retailer to pose the question of morality and suggest that perhaps retailers and other market participants should protect consumers from the downsides of IoT, Ulmart again proves that its priority is customer satisfaction and customer interests.”

The session will take place on June 1, 2017 at 3pm at Congress Centre, Conference Hall D3. 

10.05.2017

Ulmartthe future is today; Company to look at bitcoin

May 2017, 10.

Ulmart, Russia's largest online retailer, plans to start accepting bitcoin as a form of payment.

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Ulmartthe future is today; Company to look at bitcoin

May 2017, 10.

Ulmart, Russia's largest online retailer, plans to start accepting bitcoin as a form of payment from 1 September 2017 as technology has continued to evolve and blockchain has arguably become even more important than the currency it created.

Currently, Ulmart sells close to 150,000 SKU in its “first-party seller” format.  With the launch of marketplace, the company is slowly building out its online inventory.  By year-end an additional one million items could be on offer from “third-party sellers.”

“Ulmart started closely monitoring the market and regulatory environment for the use of crypto-currency in Russia as early as March 2014. As the blockchain technology is coming into our operations to fight counterfeit items, we see that the mystery that existed around the bitcoin three years ago has significantly receded,” explained Dmitry Kostygin, the Chairman and majority shareholder of Ulmart.

While the company has not yet decided which products will be available for purchase by the bitcoin, it expects that the higher-priced ones will be targeted first.  Items such as used cars and apartments, which may soon be sold via the marketplace, will be well positioned for purchase by the bitcoin.

Brian Kean, Chief International Officer of Ulmart, commented: “Life is ever in flux.  The bitcoin was created to offer security against fluctuations in hard currency.  As the technology behind the crypto-currency slips unseen into our everyday lives via the Internet of Things, it has become one of those 'why not' moments. Tomorrow is today in the world of blockchain and as a leader Ulmart strives to be ahead of the market. We welcome the willingness that the Russian government has demonstrated with regards to the review of the bitcoin technology and look forward to cooperating with it in this area.  Ulmart believes such initiatives as bitcoin can be part of the efforts to develop ‘smart’ economy and cities and will aim to play a major role in this process.”

12.04.2017

Ulmart to explore blockchain technology to help fight

April 2017, 12.

The #Blockshow2017 conference ended in Munich on April 7 and the presence of Russia's leading e-commerce player, Ulmart, came as a surprise to many of the participants. 

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Ulmart to explore blockchain technology to help fight

April 2017, 12.

The #Blockshow2017 conference ended in Munich on April 7 and the presence of Russia's leading e-commerce player, Ulmart, came as a surprise to many of the participants. 

“It's all about blockchain.  We keep talking about the 4th Industrial Revolution as if just by saying it things will change and we will become more tech savvy.  However, the heart and soul of this revolution is the blockchain,” said Brian Kean, Ulmart's Chief International Officer.

Over 500 participants from all over the world gathered at the Munich conference.  The mood among the participants was as if they had uncovered a secret and were setting sail onto an uncharted path to the future.

Many participants represented fintech but discussions about the legal aspects of the Internet of Things (IoT) and using blockchain to protect the virtual identities created some heated discussions.

 When asked by the organizers what Ulmart wanted to get out of the conference, Mr. Kean said the goal was to explore whether the blockchain technology can help fight the flood of counterfeit products.  “Consumers complain to us about this issue and ask us to do something. The blockchain will let us join forces with major manufacturers and anyone can then merely point a bar-code or QR-code and follow the entire history of the product from production line to Ulmart's fulfillment center,” explained Mr. Kean.

 Can the blockchain technology end counterfeiting by shining a light on illegal manufacturers and retailers selling the goods?  Will the blockchain protect consumers from mistakenly buying fake iPhones?   Russia's leading e-commerce platform, Ulmart, believes it can and the company will work tirelessly with major manufacturers to end the blight that is the counterfeit market.

 “It's a unique idea and speaks to the potential and excitement that blockchain brings to the world.  Everything will eventually become linked in through the blockchain,” commented Angie Bernstein, local Munich entrepreneur and bitcoin trader.   

09.01.2017

Ulmart Russia House 2.0 to serve as Russian residence in Davos

January 2017, 09.

Ulmart, Russia’s leading e-commerce company, and the Roscongress Foundation, a major business forum convener in Russia, are pleased to present Russia House, the official residence for the country’s business community at the World Economic Forum in Davos (January 17–20, 2017). Russia House will host a series of business and informal events under the overarching themes of the fourth global industrial revolution and Russia’s economic development in the context of digital transformation. It will serve as a platform for dialogue to promote innovation and advance the success of Russian businesses globally.

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Ulmart Russia House 2.0 to serve as Russian residence in Davos

January 2017, 09.

Ulmart, Russia’s leading e-commerce company, and the Roscongress Foundation, a major business forum convener in Russia, are pleased to present Russia House, the official residence for the country’s business community at the World Economic Forum in Davos (January 17–20, 2017). Russia House will host a series of business and informal events under the overarching themes of the fourth global industrial revolution and Russia’s economic development in the context of digital transformation. It will serve as a platform for dialogue to promote innovation and advance the success of Russian businesses globally.

Russia House will be located in KaffeeKlatsch at Promenade 72, just 200 metres from the Congress Centre and 120 metres from the Grandhotel Belvédère.

Russia House will welcome the heads of major global digital, e-commerce, and IT companies, renowned politicians, economists, and business leaders, as well as prominent voices from academia and the arts to discuss ways to stimulate the Russian economy, attract investment to the country, and encourage innovation.

Commenting on Russia House, Dmitry Kostygin, Chairman of the Board of Directors of Ulmart, remarked “Ulmart is delighted to have the opportunity to co-host Russia House at Davos with our partners, and to contribute to expanding dialogue with the international community on improving Russia’s investment climate and fostering its digital transformation. I hope that the success of Ulmart as a leading player in Russia’s evolving technology sector, the achievements of a number of other major Russian and international companies, and our ongoing joint efforts to advance the economy and promote innovation will demonstrate to the international community the attractive opportunities to be found on the Russian market. We are hosting Russia House because we believe that Russia needs to highlight commercial success stories and focus less on geopolitics. We are also confident that the world will be pleasantly surprised by what they will learn about our country in Davos.”

“Russia House is another example of constructive engagement between Russia and the West. This modern and welcoming venue in the Swiss Alps will allow us to highlight the opportunities which Russia offers for business to our international friends and partners, and to talk about our investment climate. Making use of innovative technology, a presentation of the St. Petersburg International Economic Forum and other Roscongress Foundation projects will enable us to clearly demonstrate the potential of modern Russia through the prism of holding major international events”, said Sergey Vyazalov, Chairman of the Board of the Roscongress Foundation.

The St. Petersburg International Economic Forum (SPIEF) will be represented at Russia House for the first time. For the duration of the event, guests of the official Russian residence will be able to take a virtual tour of the SPIEF venue, visiting the plenary session hall and the Forum’s numerous exhibition stands and pavilions.

Russia House Agenda

Tuesday, January 17, 2017

7:30–9:00: The Ulmart Digital Revolution Breakfast

Moderated by Nik Gowing, a former presenter on BBC World News, the session will focus on Russia’s digital revolution and will feature the heads of companies at the forefront of the Russian information technology sector.

Speakers will include Dmitry Kostygin Chairman of the Board of Directors, Ulmart; Eugene Kaspersky, Chairman and Chief Executive Officer, Kaspersky Lab; Anatoly Karachinsky, President and Chief Executive Officer, IBS Group; and Andrey Kuzyaev, President, ER-Telecom. The discussion will be held in English.

13:00–14:00: Russia–US Relations: Post-Election Dialogue

This session will bring together leading experts from the US and Russia, who will share their views on prospects for the development of economic relations between the two countries and offer their predictions for American investment in Russia in 2017. The discussion will be held in English.

19:30–22.30: Russia House Evening Reception

This official evening reception will be hosted on behalf of the Russia House partners. It will feature musical guests Lawrence.

Wednesday, January 18, 2017

15:30–17:00: Digital Disruption – 10 Years On

Tom Blackwell, CEO of EM Communications, will moderate a session on changes in the era of digital technology. The discussion, which will also be streamed online, will feature such panellists as Brian Pallas, Founder, Opportunity Network; Fekla Tolstoy, Development Director, Leo Tolstoy Museum; and Hanna Aase, Founder, Wonderloop.

In addition to the official programme, Russia House will host a series of working meetings and conferences. The ground floor of KaffeeKlatsch will feature an open area for various events and multi-party meetings, while the first floor will offer specially equipped private meeting rooms and a media area with a terrace and a view of the Congress Centre.

The Russia House cultural programme will include a Russian horse troika available for short rides and photo and video opportunities.

At 18:00 on January 18, 2017, Russia House will continue the tradition of hosting an ice hockey match between global business and political leaders, who will be joined by prominent hockey players, including Stanley Cup stars, at the rink in Davos.

04.10.2016

Russias New Economy Driving Growth and Creating Jobs

October 2016, 04.

Ulmart, Russia’s leading e-commerce platform and first online retailer to have topped $1 billion in revenue, has demonstrated at Munich’s Expo Real why the company is the star of the “new Russian, post-commodity economy.”

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Russias New Economy Driving Growth and Creating Jobs

October 2016, 04.

Ulmart, Russia’s leading e-commerce platform and first online retailer to have topped $1 billion in revenue, has demonstrated at Munich’s Expo Real why the company is the star of the “new Russian, post-commodity economy.”

In its second year at the real estate exhibition, Ulmart’s stand was widely praised for its innovative approach.   Displaying models of its unique urban and suburban fulfillment centers, Ulmart also conducted three business sessions focusing on the company’s role in the “4th Industrial Revolution (4th IR)” as outlined by the World Economic Forum’s founder and executive chairman Klaus Schwab.

“This digital revolution is reshaping the way business is done.  The old economy, still important as a foundation for the new one, won’t be the driver for growth in the next 10, 20 and 30 years. As the leading e-commerce platform in Russia, we have taken Professor Schwab’s book on the 4thIR, and are redesigning the way we do business going forward,” explained Brian Kean, Chief International Officer for Ulmart.

As was mentioned more than once by company representatives and participants in the business sessions at the stand, the growth in e-commerce and the tech in general, is not only creating jobs in a Russian economy beginning to show new and more robust vigor; but, this new consumer driven growth is also leading to increased valuations in real estate.

“The old warehouses and infrastructure didn’t have what we needed.  Consumers in the Russian e-commerce space have quite specific demands that are different from the demands demonstrated by their European and American counterparts.  In order to meet these consumer demands, we had to tailor-build our fulfillment centers introducing technologies that had up until then simply not been used in Russia.  As a result, we have seen explosive growth in the past five years,” said Elena Smirnova, Chief Communications Officer for the company.

The Russian consumer is an experienced resident of the 4th IR world. These consumers are driving the economy to either catch up, or, in Ulmart’s case, lead this revolution. Meeting consumer demand locally is finally growing Russia’s economy.

“The 4th IR is here and either you accept it and thrive or fail to understand it and not thrive,” said Brian Kean at the conclusion of one of the company’s sessions entitled: “Can Smart Cities become islands of Growth for Russia’s Economy.”

26.08.2016

Ulmart announces changes in the company's management

August 2016, 26.

The founder of the online retail company, Sergey Fedorinov, has left his position as Chief Executive Officer. 

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Ulmart announces changes in the company's management

August 2016, 26.

The founder of the online retail company, Sergey Fedorinov, has left his position as Chief Executive Officer.

Sergey Fedorinov explained that his decision had been prompted by a desire to entrust the operational governance of the company to a professional management team, in order to be able to focus on new business projects.

"I always thought of myself as a manager with startup potential, which I was able to implement fully in the context of Ulmart's initial strategy. I have now accepted an offer to realise my ideas in new large-scale business projects, and will retire from my position as the company's Chief Executive Officer," commented Sergey Fedorinov. "I feel content with what has been achieved during these years, and I'm truly happy that the company will move to the next stage of its development – a stage that I have also contributed to. Today, Ulmart has the most competent team of highly professional experts in the domestic e-commerce market. I'm proud that our entire team, from the shareholders to the line staff, has operated (and continues operating) as a seamless whole, and has eventually created a brand that is setting new benchmarks in the online retail sector."

Sergey Fedorinov founded Ulmart in 2008 together with Alexei Nikitin, and in the same year he took up the post of the company's Chief Executive Officer. From the very beginning, Ulmart introduced its innovative hybrid retail format. Based on the use of technology, the Ulmart team led by Sergey created a unique market platform that embodied all of the benefits of online retail and a unique logistical infrastructure. This business model was successfully brought to life, also aided by the expansion of the shareholders' base. Amongst the other online retail pioneers, Ulmart started developing and building its own logistical network, which fostered a commodity management system based on the principles of skewed vertical and horizontal distribution. This idea was a breakthrough and determined the consequent e-commerce trends in Russia.

Beginning in 2008, the Ulmart team worked out how to implement its strategy of rampant development, and successfully attained the following objectives: formulating and promoting cybermarket technology; expanding into the whole of the Eurasian part of Russia; and diversifying the large assortment of the ulmart.ru virtual storefront. In the meantime, the company implemented infrastructural development projects in the fields of personnel management, IT systems, and logistics. The key and the most significant event in this stage was the successful construction of the first multi-purpose next-generation facility – a suburban fulfilment centre (SFC) located on Pulkovskoye shosse in St. Petersburg. This unique facility was launched in November 2015 and, with good reason, became the yardstick for the next stage of Ulmart’s development.

In this way, Ulmart evolved from a local online electronics shop into the leading Russian private e-commerce company on a federal scale in just eight years, with its own network of multi-purpose fulfilment centres and a turnover that exceeds one billion dollars.

"Throughout the years of the company's existence, the Ulmart team has gained a wealth of experience and competence, and is now establishing the new technologies required for the next strategic stage of the company's development – the creation of an integrated e-commerce Ulmart ecosystem with a multi-purpose system that includes online products, as well as new retail formats and services, by leveraging the logistical network through cutting-edge fulfilment centres. The challenges associated with this stage include corporate strengthening and the implementation of a new organisational structure and new management bodies. The company currently possesses all of the necessary competences and resources for the implementation of this new strategy and the creation of the most efficient e-commerce platform in the country," continued Sergey.

Until the appointment of a new Chief Executive Officer, the company will be managed by a collective body which has been functioning efficiently for several years. The functional authority will be distributed among the company's top Managers: Finance Director, Galina Nesterova, will be responsible for the company’s financial activities; while the Commercial Director, Oleg Pchelnikov, Strategic Marketing Director, Alexandra Savina, and the Corporate Product and Sales Director, Dmitry Dmitriev, will share responsibility for the management of the commercial activities. The Development Director, Vladimir Shonurov, is responsible for Ulmart’s operational management.

The strategic issues related to the company's activities and development, including the activities covered by the Articles of Association of the Ulmart non-public joint-stock company, remain within the competence of the company's shareholders. 

01.08.2016

Russian E-commerce leader Ulmart to host Russia House at WEF 17

August 2016, 01.

Ulmart was tapped by the Russian government to create a unique business program for WEF’s annual meeting in Davos, Switzerland in January, 2017 at what is officially now called “Russia House 2017 (RH17)”.

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Russian E-commerce leader Ulmart to host Russia House at WEF 17

August 2016, 01.

Coming off successful participation at the St. Petersburg International Economic Forum (SPIEF) in Russia and World Economic Forum’s (WEF) Annual Meeting of New Champions in Tianjin, China, Ulmart was tapped by the Russian government to create a unique business program for WEF’s annual meeting in Davos, Switzerland in January, 2017 at what is officially now called “Russia House 2017 (RH17)”.

In collaboration with Roscongress--official organizer for all Russian economic forums/conferences--Ulmart will seek to build on its success from WEF 2016 when it hosted the “Ulmart House of Innovation (UHI).”  The UHI was visited by over 1500 people in three days from 23 countries.    

“As leaders in the digital transformation underway in Russia, and obviously active participants in the 4th industrial revolution (4th IR), our chairman of the board, Dmitry Kostygin, at the end of our successful WEF this year challenged us to take a more proactive role in shaping not just Ulmart’s image but Russia’s message also at WEF ‘17,” explained Brian Kean, Chief International Officer for Ulmart.

Like last year, Russia House will be located at the Davos-famous Kaffee Klatsch located at Promenade 72; but, whereas last year focus was on Ulmart and digital companies, this year the house will be opened to all Russian companies, media and even some government officials. 

In addition to RH activities, to include up to six business discussions on Russia’s role in the 4th IR, the current investment climate and growth expectations for the Russian economy in 2017, there will be a slew of cultural events hosted as well in venues throughout Davos.

 “We plan to create a Russian presence at WEF 2017…wherever one turns, they will see aspects of Russia that drastically differ from the misperceptions we have been forced to deal with as we tell our story to the world,” added Kostygin.  “Davos ’17 will be remembered as the year Russian business of the ‘new economy’ stormed back onto the world stage.”

WEF’s annual meeting takes a bird’s eye view of the world and contemplates current problems and issues.

“The annual meeting inspires CEO’s and leaders from all over the world.  At the RH, we will take this inspiration to the next level and target it at our own commercial and economic realities and hopefully learn so as to grow the Russian economy,” mused Mr. Kean.   

15.06.2016

Ulmart leads discussions on the new economy at Two Economic Forums

June 2016, 15.

At The St. Petersburg International Economic Forum (SPIEF) and then a week later in Tianjin, China (June 26-28), Ulmart, Russia's leading e-commerce platform, has officially established itself as a leading company in Russia's “new economy.”

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Ulmart leads discussions on the new economy at Two Economic Forums

June 2016, 15.

June 16-18 at The St. Petersburg International Economic Forum (SPIEF) and then a week later in Tianjin, China (June 26-28), Ulmart, Russia's leading e-commerce platform, has officially established itself as a leading company in Russia's “new economy.”

 The “new economy” or as some call it “the new normal” is one no longer able to rest on the record-high prices for oil. Given the new era of low oil prices and the unlikelihood that they will again rise to those previous levels, Ulmart has become an active promoter of what is called the “4th Industrial Revolution”--a boarder-less transformation of world economies characterized by the irreversible growth of digital in all aspects of production, education, consumption and communication.

 Speaking at a session on the future of consumption at SPIEF, the Chairman of the Board for Ulmart, Dmitry Kostygin, expressed the need for government in Russia to expedite the development of high-speed internet throughout the regions. “Russian internet penetration is 67%. Russia also has the largest pool of internet users in Europe with a population of 140 million and the lowest level of penetration. For our business alone, sales will organically double just from an increase of 20% in internet users. That increase will add thousands of jobs for Russians as we will obviously need to hire more aggressively.”

 With a large stand at SPIEF at which Ulmart sponsored sessions on the transformation of the Russian economy, Ulmart continues to push its fellow business associates and government ministers to more actively implement all that is needed to drive Russia into a leadership role in the 4th Industrial Revolution.

 “There are certain things we need to focus on...creating the infrastructure for high-speed internet, improve education...CEOs need to actively transform their company's approaches to business or else risk isolating Russia from the world economy,” said Brian Kean, Chief International Officer for Ulmart who led discussions in Tianjin, China at the World Economic Forum's meeting of Global Growth Companies.

 Ulmart believes that its future success also depends upon the readiness of the government and Russian business to transform itself digitally. “Good WIFI access in a desert won't help you help if your thirsty and surrounded by nothing but sand,” joked Kostygin. “We all need to lead our companies in this digital revolution and setting examples is best thing we can do it.”

21.03.2016

Ulmart plans to invest $250 mln to complete construction of ten logistics centers by 2021

March 2016, 21.

As part of the 27th international real estate exhibition MIPIM, which took place on March 15-17, 2016 in Cannes, France, Ulmart, represented by the Chairman of the Board of Directors Dmitry Kostygin, announced the next stage of the company’s strategic development that envisions construction of proprietary logistical platform in Russia. 

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Ulmart plans to invest $250 mln to complete construction of ten logistics centers by 2021

March 2016, 21.

As part of the 27th international real estate exhibition MIPIM, which took place on March 15-17, 2016 in Cannes, France, Ulmart, represented by the Chairman of the Board of Directors Dmitry Kostygin, announced the next stage of the company’s strategic development that envisions construction of proprietary logistical platform in Russia. These plans were disclosed by the members of Ulmart delegation both in the course of the business events organized by the company and as part of bilateral meetings.

Ulmart has already initiated implementation of the project for construction of four next-generation multifunctional distribution centers in Moscow and St. Petersburg with total investments in excess of $140 mln (10.4 bln rubles). The first center, located in the vicinity of Pulkovo Airport in St. Petersburg, was opened in October 2015. By the end of 2016, Ulmart Development plans to complete two similar venues located in the town of Mytishchi in the Moscow Region, and at Piskarevsky Avenue of St. Petersburg. This year, the company will also begin active construction of the 60,000 sqm regional distribution center at Sofiyskaya Street in St. Petersburg that will become the largest facility in Ulmart’s logistical infrastructure. The facility is set to be commissioned in Q1 2017.

It should be noted that as of the end of 2015, Ulmart assets include 190,000 sqm of effective floor areas for warehouse storage, and in the course of 2016 the retailer plans to increase its own infrastructure up to 350 000 square meters of retail and logistics properties.

“Working on our own, we had built and launched the flagship Ulmart Pulkovo center, and we are building three more such centers from scratch. Altogether we plan to create ten such complexes with a total floor area of 500,000 square meters,” said Dmitry Kostygin, the Chairman of Ulmart’s Board, at the opening panel discussion at the St. Petersburg pavilion.

Construction is fully financed with the company’s own and loaned funds. Implementation of investment projects, construction, and management of real estate are in the purview of Ulmart’s business unit Ulmart Development. The average time of construction for each of the facilities amounts to record-setting ten months.

At this year’s MIPIM Ulmart had its own 200 sqm exhibition stand and an ambitious business program with a slogan “Russia now! E-commerce growth generates investments.”

Ulmart-sponsored events drew participation from many established industry experts, among them Tom Devonshire-Griffin, Managing Director at JLL, Russia and CIS; Farook Mahmood, Managing Director of India’s Silverline Group; Olga Arkhangelskaya, partner at EY Russia; Walid Moussa, Managing Director of PBM, Lebanon; Antonio Campagnoli, partner at IL PUNTO and advisor to Italy’s CORFAC International; Bulat Shakirov, President of the Russian Association of Shopping Centers and CEO of Praktika Development; Denis Kolokolnikov, Managing Director of RRG; Vladimir Sergunin, Partner at Colliers International; Oleg Bocharov, Director of Moscow Department of Science, Industrial Policy and Entrepreneurship; and others.

Also at MIPIM, Ulmart shared its plans to create a national online marketplace, which is currently in testing stages. By the end of the year the company plans to add more than 100 partners to its own system, giving them the opportunity to enjoy both the advantages of Ulmart’s online storefront and the resources of company’s logistical infrastructure that helps to quickly deliver the goods to consumers across Russia. The company’s management believes that by doing this Ulmart will guarantee its own business growth despite the fact that the Russians’ purchasing power has already fallen by 20-25%. This will happen because logistical infrastructure will permit the company to expand its client base beyond Moscow and Russia’s largest cities, while the partnerships will expand the assortment, and the new e-marketplace will present the assortment in a new, multi-category virtual storefront. As of today, Ulmart’s virtual storefront represents 12 mln items stored at the suppliers’ warehouses. The majority of them are car accessories. In the course of 2016, the company plans to increase this partnership network significantly, attracting vendors from different product categories, both from Russia and abroad.

For the consumers, one of the key advantages of Ulmart platform is the unique technology of storage, transfer and dispatch of orders. Thanks to this system, each product unit can be dispatched on the same day it was ordered through ulmart.ru virtual storefront. If a client makes the order from a terminal in the order fulfilment center, the minimum waiting time for the order amounts to just 7 minutes. Such results were made possible by the development of proprietary automated technological solution. Market participants believe that such parameters for order delivery significantly exceed both Russian and international standards. It should also be noted that today up to 85% of all orders are picked up by clients at the urban distribution centers and pick-up points across Russia.

This year, Ulmart leads the Russian e-commerce market in terms of growth. According to the Russian E-commerce Association, in 2015 the Russian online retail market grew by 20%, to 570 bln rubles. At the same time, according to an independent evaluation by Deloitte, Ulmart’s average annual growth amounted to 63%. At year-end 2015, the company’s turnover equaled 62.7 bln rubles. Ulmart network consists of 480 logistical facilities in more than 240 Russian cities. There are four suburban order fulfilment centers, 38 urban order fulfilment centers, and 443 Ulmart Outpost pick-up points. The online retailer has a total client base of 14.7 mln users (10% of Russia’s population), and more than 30,000 orders are placed on Ulmart’s e-platform daily.

The results of the 27th MIPIM exhibition prove that the unique business model created by Ulmart in Russia appeals to the global e-commerce market. Many of the invited experts noted that the company’s rate of growth along with the program for the development and launch of new logistics and marketplace technology projects open prospects for Ulmart’s future expansion to the international markets.

According to Dmitry Kostygin, for the next two years Ulmart will concentrate on the development of the Russian market. The time to speak of company’s global market entry will come later, after the new investment strategy is implemented in Russia.

09.03.2016

Ulmart presents plans for investment into the development of regional logistics infrastructure in Russia in 2016 at MIPIM

March 2016, 09.

Russian leading e-commerce retailer Ulmart will be presented for the second time at the 27th international real estate exhibition MIPIM with a booth of over 150 square meters and extensive business program.

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Ulmart presents plans for investment into the development of regional logistics infrastructure in Russia in 2016 at MIPIM

March 2016, 09.

Russian leading e-commerce retailer Ulmart will be presented for the second time at the 27th international real estate exhibition MIPIM with a booth of over 150 square meters and extensive business program.

For the first time at MIPIM Ulmart presents the next stage of the strategic development of the company. This is the project of the creation of an e-commerce base, an integrated online system of trading platforms and services, supported with the company’s own multi-tier logistical infrastructure. It is based on a new infrastructure module developed by Ulmart to cover the areas of Central Russia, as well as the mid- and far-Urals, which make up around 85% of Russia’s domestic purchasing power.

As part of this development strategy Ulmart has already started to implement the investment project of the construction of 4 logistics centers of the new format that will be built in Moscow and St. Petersburg with a total own investment of more than 140 million dollars (10.4 billion rubles). By the end of 2015 Ulmart total commercial real estate assets were 190 000 square meters of the operational storage space. In 2016 Ulmart plans to increase its own infrastructure up to 350 000 square meters of retail and logistics properties.

While there is a general market decline and negative scenario of Russian economy development, the largest online retailer of Russia retained its positive dynamics of growth and development. In 2015 Company's turnover was around 62.7 billion rubles. The general weakening of Russia’s industries and, in particular, its classical retail sector serves as the driver for the growth of e-commerce in the domestic market.

This year at MIPIM Ulmart will exhibit prototypes of its 3 flagship logistics facilities located on the territory of the Misaj wholesale retail parks, the first functioning -commerce base prototype, that will host other retail residents along with Ulmart.

Moreover, this time the company brings to MIPIM a completely innovative project, a new generation of vending machines for the sale of the products with the highest demand and turnover. Each machine can simultaneously serve up to 5 people and store up to 5,000 SKUs (the most salable compact goods such as batteries, mobile devices, removable cartridges for filtering water, etc.). Clients will access the service of the purchase reservation - online order will be “waiting” for the owner in the machine. Each MIPIM participant will be able to test the prototype of this machine at the Ulmart booth.

At the exhibition Ulmart will be represented by the team of the top managers headed by the Chairman of the Board of Directors Dmitry Kostygin. "Digital technology and Internet companies are key elements of the "new economy", that will be drivers of the Russian economic development and growth in the coming years. Being a unique online project with a turnover of over 1 billion dollars, equipped with our own offline logistics infrastructure, we act both as an electronic marketplace, and as a developer to attract financing for the construction of new logistics facilities - that is why we are again at MIPIM," - Dmitry Kostygin commented on the company’s participation in the exhibition.

As part of its activities Ulmart also holds a series of business events named "Russia now! The growth of e-commerce generates investment". On Tuesday, the 15th of March, the first session on the future growth of e-commerce and the digital economy in the conditions of economic recession will take place. Experts from Russia, India, Italy, Lebanon and other countries confirmed their participation to share their experiences in the development of local commercial real estate markets during the crisis.

On the 16th of March there are 2 sessions planned on the Russian agenda. They will focus on the opportunities for investment into Russia on the example of Ulmart company and the efficient interaction between government and businesses in the changing current economic conditions.

Ulmart company booth at MIPIM is R7.G 8, Palais des Festivals.

23.12.2015

Tele2 starts selling SIMs in Ulmart

December 2015, 23.

An alternative mobile operator, and leading Russian Internet retailer Ulmart have announced a launch of joint project. 

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Tele2 starts selling SIMs in Ulmart

December 2015, 23.

Tele2, an alternative mobile operator, and leading Russian Internet retailer Ulmart have announced a launch of joint project. Under agreement, Tele2 SIMs and tariffs will be sold by online storefronts.

The Tele2 and Ulmart partnership project is the first case of cooperation between a mobile operator and Internet retailer on the Russian market. Moscow residents may now connect to Tele2 through the Ulmart website, the service will further be available in all regions of the companies’ presence.

The website ulmart.ru now has added a new page called “Tariffs and SIMs” where visitors may pick out a Tele2 vanity number among dozens of thousands and activate the most suitable tariff plan. In order to receive their SIMs for the shortest possible time, Tele2 subscribers just need to fill in the registration form for the agreement with the operator.

Ulmart is also offering special terms for the clients who have ordered SIMs on the company’s website. After the clients get connected to Tele2, the online retailer will reimburse 10% of their monthly expenses on mobile services as XXL bonuses (the Ulmart loyalty program) for six months in a row. Bonuses may be spent to purchase any goods at ulmart.ru.

The project is a comprehensive solution for users buying cellphones, smartphones ad tabs on the retailer’s website. A client may get purchases at the nearest collection point or in the 24-hour service centre.

Igor Maystrenko, Director of Sales and Mass Marketing at Tele2:

“Tele2 is not only actively expanding its own single-brand network but also developing cooperation with retailers in order to become closer to current and potential clients. The partnership program on selling SIMs through a virtual storefront is new to Tele2. I am sure that Ulmart’s wide choice of phones and tabs along with Tele2 profitable tariffs will produce a synergetic effect. When buying a new smartphone, buyers will be able to connect to Tele2 and start using mobile services and high-speed wireless Internet at low prices.”

Mikhail Daykhin, head of Digital Goods and Payment Systems at Ulmart:

“A launch of sales in telecommunications services has become another step on our road to the largest integrated marketplace platform of a new generation. Ulmart and Tele2 are both actively developing companies that set trends on the market and resemble in their wish to offer most demanded goods and services at a fair price. It is no coincidence that Tele2 has been selected as Ulmart’s first partner. Each in our own segment, we create simple and easy-to-understand products for the clients, and simplicity seems the hardest thing.”

24.11.2015

The most successful e-retailers today are multiproduct ones, and thats the direction Ulmart is moving in

November 2015, 24.

How has Ulmart established itself since inception?

Ulmart has managed to become Russia’s most successful nationwide online retailer in a very short period of time. When establishing our business, our team had to make do with limited resources.

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The most successful e-retailers today are multiproduct ones, and thats the direction Ulmart is moving in

November 2015, 24.

How has Ulmart established itself since inception?

Ulmart has managed to become Russia’s most successful nationwide online retailer in a very short period of time. When establishing our business, our team had to make do with limited resources. As we found, not having experience in traditional retail actually played to our advantage. We were passionate about building a company which focused on customers.

Because we decided against the traditional shop set-up from the get-go, instead putting all of our efforts into online, Ulmart’s website offers today’s most advanced product selection tools. In 2008, this was a revolutionary approach; not only did we negotiate that challenge, we also created a new business model that combines 100% online sales with our own, fully developed logistical infrastructure.

Sales during the first half of 2015 for Ulmart Group, including the NoLimit Electronics (NLE) chain, totalled €307.3 mln (RUB 21.64 bln) exclusive of VAT. This makes for y-o-y growth of 27% in ruble terms. Our ongoing efforts to diversify product offerings are bearing fruit: pre-tax profits during this period jumped by 66% compared to the year prior.

What sets you apart from competitors?

Ulmart is currently the only e-commerce player in Russia that builds and operates its logistics itself; online-only sales are placed via our electronic storefront with the upshot for customers being that we can guarantee same-day delivery in record time. Our system is unique as all of our order fulfilment centres are open to customers; they can pick up orders just seven minutes after paying, without having to wait for delivery at home or at a collection point. All order fulfilment centres are located within city limits, while suburban distribution and fulfilment centres are strategically located for easy access from Moscow and St. Petersburg.

What is Ulmart’s expansion strategy for 2016?

Ulmart continues to consolidate its market position by anticipating trends. As part of our current business strategy, we are moving towards the creation of a marketplace. We plan to keep investing in our logistical and IT infrastructure. Overall, the company has several priority areas for growth:

Diversifying what we sell. In 2016 Ulmart will exceed 150,000 SKUs, and by 2018 our electronic storefront will contain a million items – not counting digital content.

Continuing investment in logistics. We have four current projects: two suburban and one regional fulfilment centres in St. Petersburg (Pulkovskoye Highway, Piskaryovsky Avenue and Sofiyskaya Street respectively) and a suburban fulfilment centre in Moscow (Mytishchi). By 2018, we will build seven high-tech centres.

Expanding into the regions. Ulmart already has a presence in over 200 towns and cities in European Russia. In the coming months, we plan to open a further 15 urban fulfilment centres.

What kind of trends do you see emerging in the online retailer industry in 2016?

As far as e-commerce in Russia is concerned, growth has been good in recent years. Consider the size of the market over time: €4.97 bln (RUB 350 bln) in 2012, €6.67 bln (RUB 470 bln) in 2013, and €11.36 bln (RUB 800 bln) in 2014 – that’s 70% growth in 2014 alone. While Russia lags behind in internet penetration compared to most developed countries, it is still somewhat ahead of major developing markets such as Brazil and China. And one cannot forget that Russia has more internet users than any other country in Europe.

Traditional retail is undergoing a transformation. Market trends are pressing retailers to adapt and find more efficient business models. More and more internet players are realizing that having your own logistics system is a huge differentiator. If a customer wants a product now but you do not have it available, they will simply go to a competitor. However, major e-retailers are only now starting to invest in their own infrastructure. This means that Ulmart has a seven-year head start on them.

22.10.2015

B2B: World Online Retail Will Switch to ULMART Model Within 10 Years

October 2015, 22.

Five years ago when you joined ULMART, there were dozens of e-commerce projects, existing ones and those who were just launching in the market. 

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B2B: World Online Retail Will Switch to ULMART Model Within 10 Years

October 2015, 22.

Five years ago when you joined ULMART, there were dozens of e-commerce projects, existing ones and those who were just launching in the market. Today, we see ULMART among the top industry leaders, so what are the key success points that made your company so strong in just 3-4 years?

Dmitry: Well, when I became an investor of the company in summer 2010, five years ago, I was positively shocked by the efficiency of the first fulfillment center in St. Petersburg which is still in operation, and I felt there was a tremendous opportunity for not only online retail but also for what we call the second generation of online retail with efficient fulfillment centers and faster, cheaper and more reliable value proposition. If you compare it with the Amazon model, the strength of ULMART is faster, cheaper and more reliable.

What happened so that you grew so fast in 3-4 years?

D.: We chose the particular infrastructure model that we currently live in, and we believed that was the only way to go. And we saw that our competitors tried to blindly copy Amazon's approach, and we were sure it would not work in the west nor the east, and requires a lot of capital infusions. The global scenario was repeating in Russia, so we chose the different way, and now we see that our approach is significantly more efficient.

Does ULMART have any expansion plans to enter the global markets, or does your development plan so far only consider Russia?

D.: Just Russia. The Russian retail market, with the previous exchange rate, was more than a trillion dollars just a year ago, so that's more than enough. And we have a rare chance to block up not just one but three or four industries — flash sales online, national marketplace industry, and national internet retail industry — so that is the chance that is not there in every market.

We know that Alibaba was the greatest IPO in Chinese history. Do you have ambitions to hold the largest IPO in Russian history?

D.: If you look at the current figures — in the London [Stock Exchange] you have to raise a minimum of 100 million to a billion dollars, in the United States it is probably half of that, around 400-500 million dollars, that's the limit, so that is the minimum that would make it reasonable, and we think for the development of the company we need to raise about 500 million to a billion in next 2-3 years. Next year we will definitely focus on an IPO, either in London or New York, or even maybe Hong Kong. We do many activities for that. But an IPO is actually the start of corporate public life. We would also like ULMART shares to perform well some years after the public placement. I doubt if it would be the largest IPO in Russian history, but it could be the first IPO in two years. We could become the first public company after some years in Russia, so that could be another point of attraction.

Is there something special about online consumers and their behavior in the Russian market that, in your opinion, makes them different from other global markets?

D.: I think that in spite of the obvious cultural differences in behavior, people generally like shopping. Nowadays, all of us are becoming online shoppers, all of us have these smart devices with a good screen, good connectivity, so we can explore everything online, thus it becomes only the issue of fulfillment ability. How good is performing the particular item? It means it could be delivered to the consumer's door, it could be picked up in person, at what price and how reliable would this delivery be, especially during Christmas sales. All these details are becoming more important. However, I do not see many differences in Russia when comparing with China or the United States. Even the brands are the same.

What about the competition of ULMART with other international players? Aliexpress is quite active in the Russian market, and there are new retailers launching everyday. What will keep ULMART on top of its competition in coming years?

D.: First of all, we made our own cross-boarder solution by allowing our customers to shop not only for goods which are already in Russia in our fulfillment centers, but also for goods which are outside of Russia but available on our website. We have our own approach that provides faster and more reliable delivery than using the Russian postal service or another courier company. Nevertheless, we still have big doubts for the future of cross-border solutions. We believe that it will be present in a certain volume, but not so significant if you look at the whole retail market. According to current estimations it is from 1-3 billion dollars. The question is whether it will be 30 billion in five years. We don't think so. In our opinion, it will grow for sure, due to ULMART solutions, but by the time the whole internet retail market reaches 60 billion dollars, the cross-border trade will not be more than 10 percent. Firstly, the flow of fake products will be stopped by that time. The government will no longer allow the sale of products without VAT and customs duties. Secondly, customers are tired of cross-border trade as it takes a long time, the delivery is not reliable, and goods are nonexchangeable and irretrievable. Thirdly, ULMART-type solutions are clear, efficient and convenient so that they will replace cross-border ones. And fourthly, the producers will adapt to these policies as well as they do everywhere in the world.

As a company operating in e-commerce and retail, why did you come to the real estate exhibition? What were your expectations for EXPO REAL (the biggest real estate exhibition in Europe) and were they satisfied?

D.: ULMART development is very closely connected with the construction of the new generation fulfillment centers that we showed in Munich. We wanted to welcome the world's real estate community — developers, land owners, construction and property management companies, financial institutions that are interested in infrastructure projects rather than internet. A few Russian regions like Tula or Samara came to discuss the construction of new generation fulfillment centers there. We also presented our second project, a new wholesale club RYADY. Together, ULMART and RYADY become the core of the retail and wholesale parks MIZAJ that we presented in EXPO REAL in the real estate angle. This was actually the second real estate event for us after MIPIM, and we are quite satisfied.

Being one of the leaders in Russian e-commerce and also following the best international retailers' development, what do you think is going to happen in online retail in the next 10 years? What would be the key trends of its development?

D.: Well, the backbone of the retail infrastructure will shift slightly from the first generation to the second generation of what ULMART is building, such as customer-friendly fulfillment centers. The market will also become, to a certain degree, what we call e-commerce based: the trade will be not only form fulfillment centers but also from the area around it, take used cars as an example. We will also have a postal sorting center right there, so that you will receive your package from China from the same location where you receive goods from ULMART — the fulfillment center. We think the whole world will switch to the ULMART model. It is much more efficient. We discussed this with some very prominent online retailers. They do not have a choice really. They will have to build more efficient infrastructure which, by happenstance, was first developed in Russia.

23.09.2015

Ulmart - First Russian Company to Exhibit at Munich's Expo Real

September 2015, 23.

Ulmart, Russia's leading e-commerce company, plans to take its story on the road again.

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Ulmart - First Russian Company to Exhibit at Munich's Expo Real

September 2015, 23.

Ulmart, Russia's leading e-commerce company, plans to take its story on the road again.

Having exhibited its unique suburban fulfillment centers at MIPIM this past spring and then at The St. Petersburg International Forum, next on the list of the real-estate road-shows is Munich's Expo Real.

As one of the leading exhibitions for real estate and investment, Ulmart's decision to display its latest generation of suburban fulfillment centers continues the strategy as set forth by the company's chairman Dmitry Kostygin to promote what he calls "second generation e-commerce" and, secondly, to pique the interest of potential investors.

"The story is a unique one and sometimes we feel that potential investors who are so used to Amazon's last-mile obsessed approach to e-commerce have difficulty fully comprehending both the simplicity of the Ulmart approach and the potential for profitability," Brian Kean, Head of Communications and IR at Ulmart added.

As the company prepares for a likely IPO in 2016, Mr. Kostygin and other top managers have been busy traveling the world telling the unique story of Ulmart.

The company's unique model, which emphasizes pre-last mile customer pick-up, pushed Ulmart over the $1 billion threshold after a mere 5 years of operations. No e-retailer has had such success so quickly and with a model that was fully profitable until the company made aggressive infrastructure investments in 2012.

Besides having the first stand ever from a Russian, privately-held company, Ulmart also plans to sponsor business discussion panels, a working breakfast, an "idea incubator", and each day at 15:00 an oak barrel of fresh, Augustiner beer will be tapped to the famous words of Munich - O ZAPFT IS! All guests can enjoy beers and snacks.

Ulmart's stand can be found at B1.430. At all events the company chairman, Dmitry Kostygin, along with professionals from banking industries, real estate investors, journalists, Greenpeace, IKEA and other companies will be taking part in free and lively discussions.

OPENING OF ULMART STAND AND INTRODUCTION OF "Mizaj"
Presented by Dmitry Kostygin, Chairman and Sergei Fedorinov, CEO, Ulmart
Time: 5 October, 11:00-11:30
Location: Ulmart Stand

 

BUSINESS BREAKFAST
Making the Case for Star Investment Projects in Russia
Time: 6 October, 10:00 - 11:00
Location: Ulmart Stand

IDEA INCUBATOR
GREENING THE WORLD-HOW E-COMMERCE CAN LEAD MAKE RETAIL MORE GREEN

Time: 6 October, 15:00-16:00
Location: Ulmart Stand

31.03.2015

BRIEFING: Russian retailer Ulmart adapts Amazon model

March 2015, 31.

Ulmart, Russia’s leading online retailer, is building a network of urban and suburban pick-up points for its customers in an adaptation of US peer Amazon’s ecommerce model.

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BRIEFING: Russian retailer Ulmart adapts Amazon model

March 2015, 31.

Ulmart, Russia’s leading online retailer, is building a network of urban and suburban pick-up points for its customers in an adaptation of US peer Amazon’s ecommerce model.

Instead of having massive warehouses in distant locations and counting on an unreliable postal service, the company has built up a network of collection points across the country, Dmitry Kostygin, chairman of the board of Ulmart, told PropertyEU’s European Retail Investment Briefing in London last week.

‘We believe that real estate and the internet should be combined,’ he said. ‘We lease some of our centres but we also build some. We do not have stores, but we have new generation fulfillment centres where customers come and collect the purchases they have made online. If you shop with the usual online retailers, you do not know where the items are, while we have developed a transparent system that instantly tells the customer where the products are, so they can decide whether and where to pick them up themselves - or have them delivered,’ Kostygin said. 

Founded in 2008, Ulmart has some small pick-up points in urban centres, which it rents, and many suburban fulfilment centres, usually divided by type of merchandise, so the supplier delivers directly to the centre and not to a warehouse. In Russia, as in the rest of Europe, people are increasingly moving to the cities, so warehouse space has to move close to the customer. ‘We have invested in urban and suburban fulfillment centres, which are visible and easy to reach. It is more expensive for us but more convenient for the customer, and minimising costs is not always a good strategy in business,’ said Kostygin. 

Ulmart believes that Russia is catching up with the West in the area of ecommerce and non-food sales, which are in the region of $20 bn a year, will increase to $50 bn. One obstacle to retail expansion is the lack of real estate, both shopping centres and neighbourhood stores, Kostygin said. ‘Significant investment is needed. We plan to double our infrastructure in Russia, building 130,000 m2 this year and the same next year. Some we build ourselves and keep, some we build and then lease back to release capital, some we have developers build for us. It is a good time to buy in Russia because it is cheap to build in dollars.’

Even the fall of the rouble has its silver lining for retailers, Kostygin said, because people travel less abroad and do most of their shopping at home. In addition, shoppers from countries like Finland and China are coming to Russia to shop. 

The next step for Ulmart is to upgrade these new generation fulfillment centres so that they are not, as Kostygin puts it, ‘a dull commercial experience’. As in the West, customers are demanding a pleasant environment where they can sit in the service area and have a coffee or something to eat. ‘There will be fun and entertainment, but no fountains or anything extravagant like in Dubai.’

09.03.2015

Russias Ulmart Shops Around with HK on IPO Schedule

March 2015, 09.

The Hong Kong stock exchange, once one of the world’s top venues for IPOs, hasn’t been on the shopping lists of foreign companies for a long time. But a listing plan by a Russian ecommerce retailer could put it back in the fray.

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Russias Ulmart Shops Around with HK on IPO Schedule

March 2015, 09.

The Hong Kong stock exchange, once one of the world’s top venues for IPOs, hasn’t been on the shopping lists of foreign companies for a long time. But a listing plan by a Russian ecommerce retailer could put it back in the fray.

Once a market that drew foreign companies from Italian fashion house Prada SpAPRDSY -0.49% in 2011 to Russian commodity firms seeking to play up their popularity among spend-thrift Chinese consumers, Hong Kong hasn’t seen a major non-Chinese company listing for at least three years.

Some Japanese firms, such as Fast Retailing Co.FRCOY +1.15%, operator of the Uniqlo casual-clothing store, and e-commerce services provider econtext Asia Ltd.1390.HK +1.02% have listed in the past couple of years, but they haven’t raised much funds, or in Fast Retailing’s secondary listing, none at all.

Overall, apart from the retailers — Prada, whose shares are up 19% since listing in 2011 and French cosmetics producer L'Occitane International SALCCTF +1.06%, whose shares have risen 28% since 2010, most of the foreign listings in Hong Kong have seen their prices fall since going public. Canadian oil explorer Sunshine Oilsands Ltd is trading 92% below its offer price.

Russia’s biggest online retailer is now visiting the New York Stock Exchange and Nasdaq NDAQ -0.95% and plans to scout out Hong Kong and London in coming months as potential venues for an up to US$1.5 billion IPO in 2016, the company’s spokesman Brian Kean said in emailed responses to questions.

“Before buying fish, you usually check it out pretty thoroughly. Why should one of the single most important decisions a company can make be any different,” Mr. Kean said.

The company said in its statement announcing its plans to look for listing venues that “while e-commerce leaders like (Chinese companies) Alibaba and JD.com have chosen the US over Hong Kong and London , the US as a choice for placement is not a done-deal for Ulmart.”

Mr. Kean said proceeds from the IPO will be used to expand Ulmart’s logistical infrastructure by 1 million square meters and he expects annual sales to reach between US$10 and US$12 billion in five years. He said Ulmart sales topped the US$1 billion mark in 2013.

The company wants to be completely dominant in all of the European part of Russia, which is roughly 85% of all of Russia’s purchasing power, before it considers any external markets, he said.

The challenge for Ulmart will be finding an Asian, and especially Chinese angle, the usual magnet for companies listing in Hong Kong. Ulmart said in a response to questions that the attraction of Hong Kong is its liquidity: “The levels of liquidity in the Hong Kong stock exchange have been quite impressive and in some cases even in parity with the other major exchanges.” Mr. Kean said both Nasdaq and NYSE “have greeted us with open arms,”

A HKEx spokesman declined to comment on Ulmart’s listing plan. At present, around 45% of the trading in Hong Kong’s stockmarket comes from overseas institutions, including those by banks trading on their own account.

At any rate, Ulmart will be hoping that if it lists in Hong Kong, it doesn’t follow the example of bigger Russian peer United Co. Rusal Ltd. The first non-Chinese company to list in Hong Kong, the Russian aluminum giant has seen its shares fall 49% since its IPO with shares dropping 9% on its first day of listing on Jan 27,2010 even before the commodities cycle began weakening. Russian iron ore miner IRC Ltd, a unit of London-listed Petropavlovsk, has also seen its Hong Kong shares drop 55% since listing in 2010.

03.03.2015

Ulmart IPO scheduled for 2016Search begins for where best to place

March 2015, 03.

Top managers from Ulmart, Russia's leading e-commerce company and first to have topped $1 billion in sales, set out to New York City this week to meet with representatives of two of the world's leading stock exchanges: the NYSE and the NASDAQ.

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Ulmart IPO scheduled for 2016Search begins for where best to place

March 2015, 03.

Top managers from Ulmart, Russia's leading e-commerce company and first to have topped $1 billion in sales, set out to New York City this week to meet with representatives of two of the world's leading stock exchanges: the NYSE and the NASDAQ.

The purpose of the trip is to determine which exchange will be the best fit for Ulmart as it readies itself for a placement in early 2016. Visits to London and Hong Kong stock exchanges will follow in the coming months. The goal is to make an announcement by mid to end-Summer.

Ulmart top management already visited the Moscow stock exchange in November of last year—a dual listing is a possibility for the company.

While e-commerce leaders like Alibaba and JD.com have chosen the US over Hong Kong and London, the US as a choice for placement is not a done-deal for Ulmart.

Dmitry Kostygin, Ulmart's majority shareholder and chairman of the board offered the following analysis: “The size of the overall valuation will really dictate a lot in regards as to where we place. If it is large enough, say several times sales, then we think London might be a better fit as there is a tendency for continental investors to be bullish on larger listings. A smaller one, less than one time sales, might lead to the US as smaller listings there are quite well-received.”

Despite a slowing-economy and a tense geo-political situation, a comfort zone has returned and many investors are again buying into Russian stocks because of their deflated prices and thanks to a fairly stable macro-economic situation in comparison to many members of the European Union.

“Retail is a long game. E-commerce is longer and Russia is even longer still. None of the three are going to go away just because of what is going on. Oil will rebound and the Russian-Ukrainian conflict will calm down considerably and very quickly money ear-marked for Russia, still a leading emerging market, will find good deals. Ulmart happens to be the best deal going in private enterprise and it's placement be the next big thing in e-commerce,” commented Brian Kean, the company's head of communications and investor relations.

Ulmart is forecasting up to $1.7 billion in sales this year a target, which achieved, would make it nearly two times larger

03.03.2015

Ulmart joins top three online retailers in Russia according to Forbes

March 2015, 03.

Major Russian internet retailer Ulmart was announced one of the largest and most successful internet businesses in Russia. According to Forbes, Ulmart was ranked the third amongst 20 top-priced Runet companies. Ulmart was outstepped only by Yandex and Mail.ru Group (ranked the first and the second respectively).

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Ulmart joins top three online retailers in Russia according to Forbes

March 2015, 03.

Major Russian internet retailer Ulmart was announced one of the largest and most successful internet businesses in Russia. According to Forbes, Ulmart was ranked the third amongst 20 top-priced Runet companies. Ulmart was outstepped only by Yandex and Mail.ru Group (ranked the first and the second respectively).

Ulmart became the first internet retailer amongst the top companies, which list previously included only the largest and longest-standing Russian internet holdings whose income was mainly sourced from sales of intangible products. Hence, Ulmart once again confirmed its absolute leadership at Russian e-commerce market.

This year, Forbes didn’t split the companies per specialties, and the ranks were given exceptionally through independent evaluation of the company’s capitalization made by the journal experts based on public data.

According to Forbes estimations, Ulmart value totaled USD 1.4 bln. That was the highest figure among the Russian internet retailers. Forbes noted the rapid growth and investment potential of the company and pointed out the key operational achievements of Ulmart in 2014: development of logistic infrastructure, diversion of product lines, involvement in digital content (Bookmate and Zvooq), launch of Ulmart Travel service. In 2015, the company plans to complete construction of several cutting-edge suburban fulfillment centers and open at least twenty urban fulfillment centers and over 250 outposts.

“I definitely apprehend the current Forbes estimation as the first rank, by a wide margin at that”, commented Ulmart CEO Sergey Fedorinov. “We have to clearly realize that this performance has been enabled not only by means of information technologies, but also through management of inventory flow from manufacturers towards our customers, each and every million of boxes. It could happen owing to stage-by-stage creation of integrated logistic infrastructure throughout these six years of the company’s development. Infrastructure which is pretty much the most efficient in the industry, since it allows efficiently handling any physical inventories in the same way as leaders of this rating handle digital products. Ulmart is not a mere internet store; it is the first e-commerce center setting retail quality benchmarks in Russia.”

To remind, in 2014 Forbes recognized Ulmart as the largest online store in Russia. Last year, the journal published the rating of 20 largest online stores in Russia based on the companies’ sales in 2013. Ulmart was also named by Forbes among the largest private companies of Russia.

27.01.2015

World Economic Forum, Davos: Ulmart Chairman says, What sanctions? Business is still business!

January 2015, 27.

As a member of the Global Growth Companies—the 300 most dynamic companies in the world as chosen by the Davos board of organizers—Ulmart represented Russian private enterprises with the attendance of its majority shareholders, August Meyer and Dmitry Kostygin. Mr. Kostygin is also active in the company’s daily operations and currently serves as the Chairman of the Board.

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World Economic Forum, Davos: Ulmart Chairman says, What sanctions? Business is still business!

January 2015, 27.

As a member of the Global Growth Companies—the 300 most dynamic companies in the world as chosen by the Davos board of organizers—Ulmart represented Russian private enterprises with the attendance of its majority shareholders, August Meyer and Dmitry Kostygin. Mr. Kostygin is also active in the company’s daily operations and currently serves as the Chairman of the Board.

While there was an obvious de-emphasis of Russia as one of the leading emerging markets do to geo-political tensions, Mr. Kostygin rightly explained that in Russia there are hundreds of companies doing amazing things and so really, politics aside, what is all the fuss?

Russian business, while obviously feeling some pain from the current situation, has demonstrated over the past 20 years a unique ability to survive crisis; and, even to come out stronger he explained.

As discussed in some sessions about private enterprise in Russia, and also mentioned repeatedly by Mr. Kostygin in his interviews and at such sessions, the current situation in Russia very well may weed out business models that were weak and so therefore less competitive; and, as a result create “alloys of stronger, more competitive companies, both domestically and internationally. In the long-term , these period could actually end up making Russia’s private sector stronger thanks to the current “sanctions against certain individuals.” In the above links you can find video interviews, in which Dmitry Kostygin further elaborates on this idea and also explains what Ulmart has hoped to gain from its participation at Davos.

20.01.2015

Russian e-commerce leader Ulmart reports 50% sales increase in 2014, plans IPO in 2016

January 2015, 20.

Ulmart, Russia’s leading e-commerce company, confirmed today its plan to go public next year in a yet-to-be-determined Western stock exchange.

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Russian e-commerce leader Ulmart reports 50% sales increase in 2014, plans IPO in 2016

January 2015, 20.

Ulmart, Russia’s leading e-commerce company, confirmed today its plan to go public next year in a yet-to-be-determined Western stock exchange, the company’s chairman and co-owner Dmitry Kostygin told Russian business daily RBC.

Ulmart is thus considering raising $1 billion or more in exchange for 25% of the company’s shares. Advisers for the IPO could be appointed in the next few months.

The company initially planned to go public in 2015, as announced in March of last year, based on a valuation of up to $3 billion. Obviously, the degradation of the international climate which followed the Ukrainian crisis led the company to postpone the operation. However, one year after this premature announcement, Ulmart has consolidated its leadership position on the still-growing Russian e-commerce market and believes it is able to present convincing figures to potential investors.

In spite of the currently negative attitude of many international investors towards Russia, Ulmart seems so confident that it is now considering a valuation of no less than $5 billion to $6 billion, based on a preliminary estimate by JPMorgan and Morgan Stanley.

In 2014, Ulmart outperformed average market growth with its sales revenues reaching $1.3 billion in 2014 (not including VAT), up 50% from the previous year, according to preliminary company estimates.

A fraction (up to 30%) of Ulmart’s sales is generated by what it calls “cybermarkets.” These are physical venues where customers may make their purchases on a computer with screens that display an almost unlimited virtual storage area — which leaves open the question of whether or not this part of Ulmart’s sales should be considered as online or offline sales. The company operates 27 such cybermarkets, with fast expansion throughout Russia’s regions.

The company initially focused on computers, home electronics and household appliances, which remain the main sources of revenues. However, the site’s catalog now displays virtually everything from perfume and cosmetics, to pet goods and car parts. Last year, Ulmart also began selling air tickets and hotel bookings as well as digital content, having invested more than $20 million in music platform Zvooq and e-book company Bookmate.

On the logistics side, Ulmart has three main dispatching warehouses, three urban fulfilment centers, 238 pickup points and a fleet of 170 vehicles.

The company hopes to continue growth this year in spite of the expected slowdown of the Russian e-commerce market. “Since the main part of our flat costs will remain unchanged, our EBITDA could reach 6% (6 billion rubles) and our profit 2% (2 billion rubles),” believes Kostygin. At current exchange rates, these figures would correspond to more than $90 million and $30 million, respectively.

Last year, according to a research study by East-West Digital News and Data Insight, the Russian online retail market increased by 27% in rubles (to 660 billion) but just 5% in US dollars (to $17 billion). These preliminary estimates take into account neither cross-border sales ($5 billion) nor hotel bookings.

20.01.2015

Russian Web Retailer Ulmart Aims to Raise $1 Billion in 2016 IPO

January 2015, 20.

Ulmart, Russia’s largest online retailer, plans to sell $1 billion of shares in an initial public offering next year to fund expansion in the country’s e-commerce market.

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Russian Web Retailer Ulmart Aims to Raise $1 Billion in 2016 IPO

January 2015, 20.

Ulmart, Russia’s largest online retailer, plans to sell $1 billion of shares in an initial public offering next year to fund expansion in the country’s e-commerce market.

The company is likely to be valued at $5 billion to $6 billion, based on preliminary valuations by investment banks, St. Petersburg-based Ulmart said today in a statement.

The announcement provides a ray of light for the Russian IPO market, which stagnated last year after the imposition of U.S. and European Union sanctions over the Ukraine crisis and with the country’s economy facing a recession. Lenta Ltd. investors raised $952 million in Russia’s last major IPO in February, and the stock has since fallen 35 percent.

Ulmart is backed by August Meyer and Dmitry Kostygin, who were co-owners of Lenta and sold their stake of more than 40 percent to investors led by U.S. leveraged buyout fund TPG Capital in 2011. They invested the proceeds into online retail, seeking to build the Russian equivalent of Amazon.com Inc.

In 2013, Ulmart became Russia’s first online retailer to have sales surpass $1 billion. Revenue last year reached $1.3 billion, in spite of the ruble’s devaluation, the company said today. Yandex NV, Russia’s largest Internet company, expects to report 2014 sales of as much as 51.4 billion rubles ($800 million).

To contact the reporter on this story: Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editors responsible for this story: Kenneth Wong at kwong11@bloomberg.net Paul Jarvis, Celeste Perri.

03.09.2014

Russia's Disruptive e-retail Giant Ulmart Changes the Industry. Corrected Ranking Places Company at Number 6 in Europe.

September 2014, 03.

The research team of Internet Retailer 2014 Edition Europe 500 (IR) admitted error in the June 2014 ranking of e-retailers and so has named Ulmart the 6th largest WEB ONLY e-retailer in all of Europe.

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Russia's Disruptive e-retail Giant Ulmart Changes the Industry. Corrected Ranking Places Company at Number 6 in Europe.

September 2014, 03.

The research team of Internet Retailer 2014 Edition Europe 500 (IR) admitted error in the June 2014 ranking of e-retailers and so has named Ulmart the 6th largest WEB ONLY e-retailer in all of Europe.

In a letter sent to Ulmart company representatives, "[It has been] discussed with colleagues and upon further analysis we can see your point. We are updating the digital guide to classify Ulmart as web only."

Fans and students of e-commerce alike look to the "IR" rankings as a bible that captures industry trends, highlights up-and-coming stars and in some cases decides who is worthy of investor's interest.

The latest ranking put Ulmart at number 25 among all European retailers and strangely left the company out of the "web only" category.

"Fully respecting the experts at Internet Retailer, we are 100% online. Yes, we have an interesting hybrid approach that permits customers to access our fulfillment centers but 100% of all orders take place online, "commented Alexandra Savina the company's Chief Marketing Officer.

Despite the insistence of co-founder Adrien Henni of East-West Digital News, a leading e-commerce research group based inMoscow, that Ulmart is not a traditional e-retailer and should not be considered in such rankings, the Ulmart communications team convinced Internet Retailer and they sided with Ulmart's evolutionary approach.

"Permitting customers to use the internet in our fulfillment centers is not a reason to be excluded from such rankings. Turn of the Internet and there is no way to buy anything from us," added Brian Kean, Ulmart's Director of Communications and Investor Relations.

At in-fulfillment center (FC) terminals, customers can make purchases online but the current trend shows more and more movement toward mobile and out-of-FC purchasing-from home, work or sitting in a café.

Two years ago, Ulmart barely existed in the minds of the e-commerce world and yet in very quick order, the company has shot to the top of the rankings and forecasts sales this year to reach $1.5 billion. Also, it must not be forgotten that Ulmart recently celebrated only its sixth year of operations.

'Amazon and others will follow our model ," predicted Ulmart's chairman of the board and majority shareholder Dmitry Kostygin on Bloomberg's Market Makers morning program in February of this year, and it all begins with the research professionals.

28.03.2014

Russia's biggest internet company eyes London IPO

March 2014, 28.

Ulmart, Russia's answer to Amazon, is close to appointing advisers for an IPO in London next year, as sales surge past $1bn (£602m).

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Russia's biggest internet company eyes London IPO

March 2014, 28.

Russia's biggest e-commerce company is close to appointing advisers for a London IPO next year, after passing $1bn (£602m) in sales.

Ulmart, an Amazon-style marketplace that started life selling computers, but has branched out into children’s toys and furniture, is Russia’s largest internet business, after overtaking the Russian search engine Yandex.

Discussions are underway about hiring two banks to advise on the flotation of the company, which is currently valued at between $2.5bn and $3bn.

Ulmart’s projected revenue for 2014 is $1.6bn, up 60pc from $1bn in 2013.

Dmitry Kostygin, the majority owner and chairman of Ulmart, met Goldman Sachs in London today, following a recent meeting with the bank’s Moscow arm.

Mr Kostygin, who last year increased his stake in Ulmart to 60pc, is also talking to banks and investment funds across London, Russia, Switzerland, the US and Asia about raising $300m to $400m of growth funding.

If the financing talks prove successful, Ulmart will postpone its London listing for around three years while it continues to focus on expanding the business.

Ulmart currently sells around 80,000 products, but plans to expand to 150,000 by the end of the year.

The company also plans to quadruple the capacity of its distribution centres over the next 18 months, while tripling sales. Two new fulfilment centres are under construction in Moscow and St Petersburg.

Mr Kostygin chose to list the company on the London Stock Exchange after its recent surge of public offerings, such as AO World, Merlin Entertainments and Poundland.

But he remains positive about doing business in Russia, despite the political unrest in Ukraine. “I see that there is enough capital in Russia,” he said. “It will remain the fifth largest economy in the world for at least the next decade.”

However, Mr Kostygin warned that a decision by the US and the EU to impose sanctions on Russia in response to President Putin’s actions in Crimea would be a “huge mistake”.

“It is primitive to seize or freeze assets, or to say businesses have to leave Russia,” he said. “If they [the West] are really that stupid, I think Russia benefits. Russians are already more cautious about using Western suppliers, such as Facebook and Visa, and they are looking for their local or Asian substitutes.”

Mr Kostygin, who spent five years in Zurich earlier in his career, favours the Swiss model of “the sovereignty of the small communities”.

Under Switzerland’s federal government, each of the country’s 26 cantons is responsible for setting its own tax rates and regulation, enabling home-grown enterprises to thrive.

08.08.2014

The first international conference E-retail Drivers-2014 in St. Petersburg

August 2014, 08.

The first international conference E-retail Drivers-2014 organized by Ulmart was held in St. Petersburg. It was attended by representatives of manufacturers of electronics, home appliances and other goods, as well as e-commerce experts and analysts. The conference participants discussed the current status of e-commerce sphere, its development potential, implementation of new technologies.

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The first international conference E-retail Drivers-2014 in St. Petersburg

August 2014, 08.

The first international conference E-retail Drivers-2014 organized by Ulmart was held in St. Petersburg. It was attended by representatives of manufacturers of electronics, home appliances and other goods, as well as e-commerce experts and analysts. The conference participants discussed the current status of e-commerce sphere, its development potential, implementation of new technologies.

Ulmart CEO Sergey Fedorinov, Huawei Device, Yota, Lenovo, Intel representatives delivered their speeches at the conference.

They discussed the new internet possibilities for brand promotion, necessity to make internet accessible from any place, potential of portable electronics and PC+.

Key Trends and E-retail Drivers discussion panel was attended by representatives of Ulmart, GfK, Ernst&Young; Google and Yandex.Market. Brian Kean, Ulmart Communications Director, moderated the discussion.

The participants discussed what the Russian internet retail market will be like in future. Delivery accuracy and promptness were named as the key areas of internet retail improvement. “In the past it is the customer who had to come to the outlet, nowadays it is the outlet which needs to approach the customer”, mentioned Timur Samerkhanov from GfK in this respect. Yury Berchenko from Google Russia pointed out that the prompt delivery is a key competitive advantage in the largest country facing real logistical challenges.

In the context of e-commerce technologies, Reymond Fowler, Ernst&Young Director in Russia, noted that their major target is to make the customer service process more convenient; improve the lifestyle and offer the customer new shopping experiences. At the same time, it is important to distinguish “illusive futuristic innovations” and those that are practical and important for people. “The company’s goal is to take up innovations and understand the ways they could be efficiently put into practice”, added Alexey Shafranov, Yandex.Market.

“There are no doubts anymore that e-commerce is one of the most interesting and promising spheres. One way or another, it affects different companies in various business areas: production, telecommunication, and technology companies. We have organized the conference to share our achievements with our partners, discuss current e-commerce market conditions and future behavior. We expect such workshops to become traditional and intend to hold them every year”, says Sergei Fedorinov.

23.05.2014

ULMART ACQUIRES 'CLOSE TO 50%' STAKE IN ZVOOQ AND BOOKMATE

May 2014, 23.

Leading Russian online retailer Ulmart has moved a step closer to adding digital content to its online store by acquiring a minority stake “close to 50%” in Dream Industries.

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ULMART ACQUIRES 'CLOSE TO 50%' STAKE IN ZVOOQ AND BOOKMATE

May 2014, 23.

Leading Russian online retailer Ulmart has moved a step closer to adding digital content to its online store by acquiring a minority stake “close to 50%” in Dream Industries, which runs Spotify-analogue music service Zvooq and e-book library Bookmate. 

The shares were previously held by Koshigi, a fund owned by Ulmart co-owner Dmitry Kostigin. Earlier this month Kostigin indicated his intention to sell these shares to Ulmart, and explained that the company intends to start selling digital content on its platform in the near future. 

The deal was completed in two parts. Ulmart paid $6.5 million to Koshigi for some of the shares, while the rest were exchanged for shares in Ulmart worth “between $35 and 60 million - depending on Ulmart’s valuation”. 

Kostigin indicated that Yano Holdings now owns around 40% of Dream Industries, which is registered in Cyprus, while Finnish fund Essedel also has a stake. 

While Kostigin is realistic about the difficulty of getting Russians to pay for digital content when so much is available for free, he believes that it is possible to make money from it:

"Russia needs a multi-platform service (books in no less than 6 formats) that works on different devices. Piracy has flattened the Russian market, but if consumers were offered an inexpensive, good quality service that allowed them, say, to pay 30 roubles (less than $1) and download the 30 best comedies of the year in excellent quality in just a few seconds, then they might well be willing to pay. It’s just the same with music. The experience of developed markets shows that a subscription system probably works better than individual downloads. We’ve got some useful experience and some decent ideas that should allow us to take the industry forward. So you can expect to see books, music and films in Ulmart’s online store within the next year.”

Ulmart is not the only Russian retailer trying to break into the digital content market. Earlier this month Ozon acquired a stake in LitRes, Russia's most popular e-book and audiobook service. 

22.05.2014

'Amazon will follow our model': Ulmart CEO

May 2014, 22.

If e-commerce giant Amazon thought it had tough competition from China's Alibaba, it might want to consider a new Russian dark horse in the shape of Ulmart.

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'Amazon will follow our model': Ulmart CEO

May 2014, 22.



If e-commerce giant Amazon thought it had tough competition from China's Alibaba, it might want to consider a new Russian dark horse in the shape of Ulmart.

Headquartered in St Petersburg, the online retailer has broken away from its domestic rivals and has started to post promising sales, making it the biggest online retailer in Russia by revenue. Often regarded as Russia's answer to Amazon with its sales of electronic goods and computer hardware, Chairman Dmitry Kostygin fired a warning shot at its U.S. counterpart.

"We bet that even in a couple of years even Amazon will switch to our model, " he told CNBC on Thursday at the St Petersburg International Economic Forum (SPIEF).

That model? Well, Kostygin believes Ulmart's model represents the "next generation of the internet retailing", meaning faster delivery and greater reliability. "We can argue that we are somewhat better than Amazon," he added.

Tipped for a London flotation either this year or next, Ulmart reported sales for 2013 that exceeded $1 billion earlier this year and claimed that it has more "dynamic" growth than Amazon. By investing heavily in a nation-wide system of fulfillment centers which are located in large cities, it believes it can make deliveries in as little as two hours.

Helped by a growing domestic middle class in Russia, Kostygin believes that the future is bright for online retail in the country and said that there had been no significant fallout for Ulmart with regards to Russia's annexation of Crimea in April and the ensuing sanctions.

"It's always tough, there's not even the slightest change in the business in Russia," he said on Thursday.

05.05.2014

Ulmart show how Russians business really look like.

May 2014, 05.

Ulmart executives travel the world telling the story of the company’s successes in the hope of attracting investment for further expansion of existing operations, several observations have been made: the first is that there are opportunities for Ulmart to do business in countries with large groupings of Russian immigrants. About this, we reported last month.

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Ulmart show how Russians business really look like.

May 2014, 05.

Ulmart executives travel the world telling the story of the company’s successes in the hope of attracting investment for further expansion of existing operations, several observations have been made: the first is that there are opportunities for Ulmart to do business in countries with large groupings of Russian immigrants. About this, we reported last month.

And secondly, many foreigners have really no idea just what business in Russia looks like. The stereotypes that exist in movies often come to mind. Some imagine that every business in Russia is a massively-bureaucratic company run by government employees. Or that everyone in Russia works in the sale of natural resources.

As part of the drive to raise awareness about Ulmart, top management decided that it would be both helpful for Ulmart and for really any companies seeking to do business with foreigners on foreign soil.

So, to this end, Ulmart ran an ad over the week of 14 to 20 April. The 30-second ad was shown on average 50 times each day and was cheered by both local Americans and some Russian tourists who happened to be there. One such tourist, Ksenia Storchak was visiting the city and looked up and to her surprise saw the words “Ulmart” written on the massive neon screen.

“I had just flown in and was tired from jet-lag and then I see ‘Ulmart’ and for a second, I completely lost it and thought I was back in St. Petersburg near the Moscow Train Station! And then I saw the bears and matryoshki and was like ‘crazy, Ulmart is even over here!’ It made me feel so close to home right in the middle of Times Square.”

As the company tours the world telling its story to businessmen and investors, there is a chance that should you find yourself in Hong Kong, Tokyo, London or Rio, a Ulmart ad just might be playing.

“We have to dispel the myth that we are just a country of bears, vodka and shapka-wearing men named Ivan,” said Elena Smirnova, Ulmart’s Head of Advertising.

07.04.2014

Ulmart-Russia's E-commerce Leader Pulls Away From the Crowd With Robust 1st Quarter Sales Results

April 2014, 07.

Ulmart's first quarter results continue to demonstrate the strength of the company's unique format which combines the vastness of an Amazon-style online electronic catalogue while overcoming the logistical hurdles that cause headaches for Amazon and so many other e-commerce companies.

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Ulmart-Russia's E-commerce Leader Pulls Away From the Crowd With Robust 1st Quarter Sales Results

April 2014, 07.

Ulmart's first quarter results continue to demonstrate the strength of the company's unique format which combines the vastness of an Amazon-style online electronic catalogue while overcoming the logistical hurdles that cause headaches for Amazon and so many other e-commerce companies.

Ulmart's unique nationwide net of URBAN FULFILLMENT CENTERS serve to dissuade customers from last-mile servicing leading to higher satisfaction and lower costs for the company.

Ulmart's first quarter results are slightly ahead company forecasts with an increase of sales revenue of 44.3%. While the average buy dropped 4% the number of purchases increased by 46% to just under three million. The strong growth in the number of purchases is thanks to Ulmart's aggressive move into non-white and electronics goods which will surely further strengthen the company's bottom line margin.

The electronic-catalogue expansion plans for the remainder of 2014 will increase the current number of 63,000 SKU to 85,000 by year's end with most of the growth coming in the hot product-lines of children's goods, auto parts and tires and DIY. Computer sales were still the leading category but thanks to the company's shifting priorities in seeking to stabilize and grow its margins, the category declined by 6% compared to 4th Quarter results from last year.

Up until the end of 2013, enthusiasm among the investment community in Russian e-commerce was rather muted due to the lackluster growth of the industry's formerly benchmark company Ozon ($252 million GMV, 2012). Ulmart's net sales of $1.2 billion for 2013 have since a buzz in 2014 and suddenly both Ulmart and Russian e-commerce threaten to become the next big thing.

Ulmart's highly-experienced management team led by one of Russia's most dynamic CEO's Sergei Fedorinov has demonstrated over its very short life-span (the company was founded in August 2008) that whatever Fedorinov (and Dmitry Kostygin, the energetic Chairman of the Board) and Ulmart do is usually the right thing at the right time and the right place.

03.04.2014

Russian consumers want to shop online but pay cash

April 2014, 03.

Russia’s shoppers are buying more goods online than ever before. E-retail sales have grown at a rate of around 26 per cent a year and 57 per cent of non-grocery retail spending is now made online.

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Russian consumers want to shop online but pay cash

April 2014, 03.

Russia’s shoppers are buying more goods online than ever before. E-retail sales have grown at a rate of around 26 per cent a year and 57 per cent of non-grocery retail spending is now made online.

This may seem odd for a nation that prefers to pay in cash and doesn’t have a reliable postal service, both typically important for e-retail. Attitudes to other payment methods are changing, however, and some home grown businesses have adapted their approach to suit Russian preferences.

The number of Russian households with internet access exceeded those without for the first time in 2013, according to a report by PwC. Home internet penetration is projected to grow to 68 per cent by 2017, reaching 38m households.

More significantly, the number of people with mobile internet is increasing. In 2013, 41 per cent of respondents of PwC’s survey said that they use their mobile phone for shopping. About 61m people in Russia (43 per cent of the population) have mobile internet, which is expected to rise to 100m by 2017.

But while consumers in Russia may be happy to buy online, they often prefer to pay in cash. Card payments account for around 15 per cent of e-transactions in Russia. “Russia has traditionally been a cash-based society,” says Souheil Badran, senior vice president at Digital River, a company that sets up payments systems on websites. “Cash is still king in Russia but you’re starting to see more payment types like QIWI and Yandex.”

“Digital goods are typically paid for by local digital payment methods such as Yandex, QIWI and Webmoney,” says Ieuan Owen, senior vice president of ecommerce strategy at WorldPay. “These ewallets now account for between a quarter and a third of all ecommerce consumer spend in Russia… Given the distrust of cards, the rapid rise in the use of these payment methods by consumers and merchants is a key driver of ecommerce growth in Russia.”

Customers’ preference for paying in cash need not be a problem for e-retailers according to Dmitry Kostygin, chairman of Ulmart, one of Russia’s biggest e-retailers. Roughly 90 per cent of Ulmart’s sales are picked up by customers from collection points dotted around Moscow and St Petersburg.

Customers can pay for their items online or in whatever form they like on collection. Around two-thirds of payments are made in cash, says Kostygin. Only a quarter are made by card and the rest use electronic wallets such as QIWI.

PwC’s research suggests that Russians don’t mind picking up their purchases so long as the collection points are in convenient locations:

Our survey shows that internet users find the option of picking up ordered goods at a convenient location to be one of the most important delivery features… We can expect further collaboration between online retailers seeking to expand their reach and other businesses with available space in a convenient location, be it a local convenience store, gas station, metro or bus station, or something else.

Ulmart’s system seems to work in Russia. Company sales exceeded $1bn last year. Kostygin thinks that companies such as Amazon should use a similar system to Ulmart’s – even in parts of the world where there is a good postal service. However, aside from Poland, few other markets have similar constraints and customer preferences.

28.03.2014

Russia's biggest internet company eyes London IPO

March 2014, 28.

Ulmart, Russia's answer to Amazon, is close to appointing advisers for an IPO in London next year, as sales surge past $1bn (£602m).

more

Russia's biggest internet company eyes London IPO

March 2014, 28.

Russia's biggest e-commerce company is close to appointing advisers for a London IPO next year, after passing $1bn (£602m) in sales.

Ulmart, an Amazon-style marketplace that started life selling computers, but has branched out into children’s toys and furniture, is Russia’s largest internet business, after overtaking the Russian search engine Yandex.

Discussions are underway about hiring two banks to advise on the flotation of the company, which is currently valued at between $2.5bn and $3bn.

Ulmart’s projected revenue for 2014 is $1.6bn, up 60pc from $1bn in 2013.

Dmitry Kostygin, the majority owner and chairman of Ulmart, met Goldman Sachs in London today, following a recent meeting with the bank’s Moscow arm.

Mr Kostygin, who last year increased his stake in Ulmart to 60pc, is also talking to banks and investment funds across London, Russia, Switzerland, the US and Asia about raising $300m to $400m of growth funding.

If the financing talks prove successful, Ulmart will postpone its London listing for around three years while it continues to focus on expanding the business.

Ulmart currently sells around 80,000 products, but plans to expand to 150,000 by the end of the year.

The company also plans to quadruple the capacity of its distribution centres over the next 18 months, while tripling sales. Two new fulfilment centres are under construction in Moscow and St Petersburg.

Mr Kostygin chose to list the company on the London Stock Exchange after its recent surge of public offerings, such as AO World, Merlin Entertainments and Poundland.

But he remains positive about doing business in Russia, despite the political unrest in Ukraine. “I see that there is enough capital in Russia,” he said. “It will remain the fifth largest economy in the world for at least the next decade.”

However, Mr Kostygin warned that a decision by the US and the EU to impose sanctions on Russia in response to President Putin’s actions in Crimea would be a “huge mistake”.

“It is primitive to seize or freeze assets, or to say businesses have to leave Russia,” he said. “If they [the West] are really that stupid, I think Russia benefits. Russians are already more cautious about using Western suppliers, such as Facebook and Visa, and they are looking for their local or Asian substitutes.”

Mr Kostygin, who spent five years in Zurich earlier in his career, favours the Swiss model of “the sovereignty of the small communities”.

Under Switzerland’s federal government, each of the country’s 26 cantons is responsible for setting its own tax rates and regulation, enabling home-grown enterprises to thrive.

07.03.2014

Ulmart: Russia's Online Retailer Chairman says 'Amazon has no Chance' in Russia.

March 2014, 07.

In an interview last week on the Bloomberg morning news program "Market Makers," Ulmart's Chairman of the Board, Dmitry Kostygin calmly stated that "Amazon does not have a chance in Russia." Ulmart is Russia's number one internet retailer and finished 2013 with sales of over $1.2 billion.the first is that there are opportunities for Ulmart to do business in countries with large groupings of Russian immigrants. About this, we reported

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Ulmart: Russia's Online Retailer Chairman says 'Amazon has no Chance' in Russia.

March 2014, 07.

In an interview last week on the Bloomberg morning news program "Market Makers," Ulmart's Chairman of the Board, Dmitry Kostygin calmly stated that "Amazon does not have a chance in Russia." Ulmart is Russia's number one internet retailer and finished 2013 with sales of over $1.2 billion.

Perhaps this may come to many as a surprise given Amazon's resources, size and aggressive business practices, the Ulmart model, which Kostygin calls the "fourth generation" of retail, is one that is more appropriately geared for the particularities of the Russian market.

The "fourth generation" model, as described by both Kostygin and Sergei Fedorinov, Ulmart's co-founder and CEO, to some in the West almost seems counter-intuitive. Large fulfillment centers located in city centers, just outside city centers and in suburban areas are fronted by small "carry-out areas" at which Russian consumers can purchase the chosen product online.

The shopper in these carry-out areas can use Ulmart's computer terminal to peruse the hundreds of thousands of goods and then send the product into his "shopping cart." Next, he purchases the item either via credit card or in many cases by paying cash at the Ulmart cash window located in the carry-out area.

As explained by Kostygin, "the most popular items are located where the people are and so purchase and receipt of product can take as little as 10 minutes." Amazon's reliance on third-party delivery companies like USPS, FedEx and others only permits them to make delivery in a couple of days. By permitting customers to purchase what they want where they want and when they want, Ulmart has in fact managed to tame the logistics beast that has so often humbled larger multi-nationals in Russia.

In December, Amazon and others were affected when FedEx and DHL mentioned they were halting shipments to Russia. In addition,Germany's leading long-distance retailer, Otto, has also found Russia's logistical hurdles at times to be nearly insurmountable.

Fortifying Ulmart's "web of fulfillment centers" is a fleet of 190 trucks that can service customers over the "last mile". This aspect of the Ulmart approach has been mastered by the company and they are now capable, in cities like Moscow - known for terrible traffic problems - of making deliveries to the home or office within 2 hours. This service is called "delivery 2.0."

27.02.2014

Russia's Online Retail Leader Says 'Amazon Has No Chance'

February 2014, 27.

Russia has become the it girl of e-commerce. Even amid a slowing economy, the country’s online shopping increased 26 percent last year, to 510 billion rubles (about $14 billion), according to Moscow’s Data Insight, and could double by 2015. That has made the country an intriguing target for foreign players such as Amazon.com, EBay, Asos, and China’s Alibaba Group, while boosting the fortunes of such local companies as search engine Yandex and Amazon-like Ozon.

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Russia's Online Retail Leader Says 'Amazon Has No Chance'

February 2014, 27.

Russia has become the it girl of e-commerce. Even amid a slowing economy, the country’s online shopping increased 26 percent last year, to 510 billion rubles (about $14 billion), according to Moscow’s Data Insight, and could double by 2015. That has made the country an intriguing target for foreign players such as Amazon.com (AMZN), EBay (EBAY), Asos (ASC:LN), and China’s Alibaba Group, while boosting the fortunes of such local companies as search engine Yandex (YNDX) and Amazon-like Ozon.

The dark horse leading the race right now is Ulmart, an online retailer that reported $1.2 billion in sales last year. It has succeeded by doing what Amazon does not. Instead of wooing customers with low-cost home delivery, Ulmart encourages them to pick up their orders at urban outposts and warehouses that double as stores. While Amazon ships on such partners as United Parcel Service (UPS), Ulmart keeps its own fleet of 190 trucks. The St. Petersburg company ships fast-moving items in bulk from suppliers to urban outlets instead of breaking apart the shipment and repackaging it at a mega-hub. Where Amazon’s Jeff Bezos racked up $3 billion of losses in his early years, Ulmart’s chairman and major shareholder, Dmitry Kostygin, says his site has lost around $30 million in its first five years. “It’s in the ‘illions,’ but with an m,” he laughs. And yet Ulmart’s three-tier distribution and fleet allow it to bypass Russia’s byzantine postal service, turn around orders in as little as seven minutes, and accept cash in a country where many are reluctant to use credit cards. While Amazon has expanded deliveries and may be testing the waters in Russia, Kostygin says he’s not worried. “In this market,” he says. “Amazon has no chance.”

That prognosis may prove to be premature in a country where e-commerce makes up less than 2 percent of retail sales. But it points to the strength of the hybrid model that Ulmart’s co-founder and chief executive, Sergey Fedorinov, has built with Ulmart Outposts and Kibermarket stores. It also illustrates the intensity around Russia’s e-commerce business right now. Kostygin and Fedorinov were together in New York yesterday to promote the company to journalists. That follows an unusual press release earlier this month in which Ulmart announced it was shelving plans to become the “first major retailer in all of Europe” to accept Bitcoin as payment after the Bank of Russia warned that could promote illegal activities, such as money laundering or the financing of terrorism. Ulmart’s push comes at a time when Ozon CEO Maelle Gavett has also raised her public profile and Russia’s government is making it tougher for locals to buy goods at foreign sites.

Ulmart chairman Kostygin knows firsthand the power that foreign rivals wield when it comes to having capital and known brands. As chairman of the hypermarket chain Lenta, Kostygin tussled with TPG Capital when it took a controlling interest, though in yesterday’s interview he cited the U.S. private equity giant’s stake as a sign of Russia’s openness to foreign players. (Lenta is expected to raise at least $1 billion in its initial public offering on the London Stock Exchange.)

On one level, Ulmart’s formula is simple. Its product mix focuses largely on electronics, and its network sticks to the cities of “European” Russia, an area, about three times the size of Texas, where much of the country’s wealth and consumption are concentrated. Ulmart currently has three national hubs that average 12,000 square meters, or roughly 129,000 square feet, with plans to build two hubs almost twice that large this year. (Many of Amazon’s 100 fulfillment centers worldwide exceed 1 million square feet.) Customers can pick up or order goods at 30 urban warehouses, each of which range from 2,000 to 3,000 square meters. They can also have their orders sent to one of 250 outposts that are only 100 square meters or pay extra to get home delivery a day or two later on one of Ulmart’s 190 trucks. Those living in other parts of the country are subject to the vagaries of Russian Post, a system so sclerotic that Kostygin says it can take two weeks just to cover the 400 miles between Moscow and St. Petersburg.

26.02.2014

How Ulmart Delivers Within Ten Minutes in Russia

February 2014, 26.

Ulmart Chairman Dmitry Kostygin discusses online retail in Russia on Bloomberg Television's "Market Makers."

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How Ulmart Delivers Within Ten Minutes in Russia

February 2014, 26.

Ulmart Chairman Dmitry Kostygin discusses online retail in Russia on Bloomberg Television's "Market Makers."

03.02.2014

From Kaliningrad to Vladivostok. Ulmart Russia's First Internet-retailer to Exceed $1 Billion in Sales

February 2014, 03.

• Russia's leader in internet-retail exceeds the $1 billion in sales barrier.

• Opened for business only 5 years ago and already showing more dynamic growth than Amazon.

• Ulmart has invested heavily in creating a nation-wide system of "fulfillment" centers that are located in large cities

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From Kaliningrad to Vladivostok. Ulmart Russia's First Internet-retailer to Exceed $1 Billion in Sales

February 2014, 03.

•      Russia's leader in internet-retail exceeds the $1 billion in sales barrier.

•      Opened for business only 5 years ago and already showing more dynamic growth than Amazon.

•     Ulmart has invested heavily in creating a nation-wide system of "fulfillment" centers that are located in large cities permitting Ulmart to make deliveries in as little as 2 hours.

•      Ulmart is growing twice as fast as the whole e-commerce sector due to rising financial opportunities of the Russian public seeking to fulfill years of pent-up demand for high-quality products with strong post-sale services and reliable delivery.

•    Ulmart uses its own fleet of nearly 200 trucks covering the entirety of the European part of Russia excluding Kaliningrad.

•     Russia is Europe's largest pool of internet users with 62 million--some estimates show it growing to over 70 million by 2015.

Ulmart presents its financial and operating results for 2013. The company has experienced robust growth in all spheres of business. Revenue has increased by 62%to $1.2 billion (including VAT 18%) from 2012 end-year results.

During its 5 years of operations, Ulmart can be positively compared with e-commerce leaders like Amazon, Alibaba, Google and others.

The large and modern infrastructure of its online-stores serviced by strategically-situated fulfillment centers makes Ulmart a favorite stop for the 750,000 unique users browse the site daily. The conversion rate is a market-leading 4.5%.

Dmitry Kostigin, Ulmart's Chairman of the Board: "We are the leader of Russian internet-retail. We see a great potential for growth.Russia is the largest user of the internet in Europe and these people are our potential customers. As the economy itself slows, e-commerce continues to grow dynamically."

Ulmart made large investments in its infrastructure last year by expanding into Russia's regions. 5 fulfillment centers (FC) were constructed and 140 pick-up points called "Outposts" were opened.

The company currently has three national "hubs"-over 12000 square meters-supplying the fulfillment centers. Plans are to build additional 2 hubs of over 20,000 square meters in 2014 and to open 10 FC's.

Sergey Fedorinov, CEO of Ulmart: "We showed incredible growth, but, growth we expected. So far all of our growth predictions have come to fruition. Step-by-step we move to an ever larger and more profitable platform. Soon we will say that we service all Russians, from Kaliningrad to Vladivostok."