ALMATY – The ZETA Company is expanding to take opportunity of growing markets for its furniture at home and abroad.
The government has approved a 75 million tenge grant under the Business Road Map 2020 for the company to expand its production facilities and upgrade its equipment.
ZETA has built a new four-level complex in Almaty’s Kulager district to make cabinet furniture and theatre chairs with equipment imported from Italy.
Today, ZETA consists of several divisions. In 2012, its turnover exceeded 8 billion tenge (US$1 = KZT150) and it invested eight million dollars in expanding its production capacity. Last year, it also paid 400 million tenge in taxes and another 1.3 billion tenge in customs charges.
ZETA now employs 1,400 people. Its founder and CEO, Kanat Omarov, travels around the world raising new investment and seeking new ideas and technologies. He has built ZETA into one of the largest industrial enterprises in Almaty. Last year, it sold the largest number of chairs in the country. It has a sales list of 1,200 products through 22 direct sales outlets.
The company has prospered, despite being located next door to China, one of the world’s largest furniture-producing economies.
“With our country’s entry into the Customs Union (with Russia and Belarus), conditions for the development of domestic production became much more favourable,” ZETA Deputy Director General Mahsut Omarbekov told The Astana Times. “Then, we reduced our imports of finished products from China after customs duties increased. Also, we recognized that developing local manufacturing means creating jobs for people in Kazakhstan.”
“President Nazarbayev is absolutely right to say that the Customs Union is a rehearsal for domestic manufacturers before Kazakhstan joins the World Trade Organisation (WTO),” Omarbekov said.
Ukrainian furniture companies are eager to enter the Kazakhstan market and they already account for 28 percent of it; Russian companies account for another 18 percent. Belarus, too, has always been famous for its furniture industry, the ZETA executive said.
“Now, ZETA’s production volume allows us to be the leaders in Kazakhstan,” Omarbekov said. “Our advantage also lies in the fact that tenders favour domestically-produced goods. But accession to the WTO will create new challenges to us.”
ZETA has always concentrated its main production in Almaty, but now it is also expanding to Astana. The company has already bought a land plot there and plans to build a 5,500 square metres industrial complex there. It has already built a 2,500 square metres pipe rolling production plant.
The company gets most of the raw materials for its furniture from the Russian city of Ufa. The metal for its chairs, armchairs and sofas comes from Temirtau in the Karaganda region.
In 2013, the company plans to expand on a total of 12,000 square metres of industrial space in Almaty and Astana, thanks to new investment from its Italian partners.
The company began to expand rapidly six years ago when it bought two hectares (20,000 square metres) of land at an abandoned bakery plant in the city of Talgar, near Almaty. Today it is ZETA’s main production centre for pipe rolling and plastic production and employs 600 people. The Talgar plant’s products are 10 times cheaper than similar products from Russia (or only 10 percent of their unit cost). ZETA is also developing the leather goods industry in Kazakhstan. It has published a children’s book with a print run of one million to educate its readers how to sort trash and save secondary raw materials for future production.
ZETA remains committed to introducing further innovation in the domestic furniture industry, substituting for foreign imports and creating new jobs. It is also committed to improving the living conditions of its workers and has purchased 18 apartments in Almaty and another 38 in Talgar to house them, as well as constructing a new building with 15 apartments.