“Brickford” announces suspending of cooperation with the largest European brick producer Wienerberger. According to the Brickford business strategy the company portfolio includes only premium building ceramic brands. The premium quality as understood by the company’s management is in the product quality and the transparent working conditions with dealers.

“Brickford” became the official dealer for Wienerberger in Russia in 1997. By 2000 the share of Wienerberger production reached 50% (800 thousands bricks) in Brickford sales. In 2007 it decreased to 400 thousands bricks. The share dropped to 3%. With the opening of Wienerberger representative in Russia in 2005 sales began declining. At the same time there was a premium building ceramic market growth in Russia and “Brickford” sales were increasing by 200-300% every year.

“The Wienerberger policy towards dealers in Russia is characterized as a system of “distribution”, not a system of sales”, - says Ilya Bocharov, CEO of “Brickford”. – I can’t find an explanation to the principles of distribution of quotas, production and discounts among dealers. The most part of production we received from Wienerberger were rejects or remains”.
The appearance in a list of firms which never before were engaged in a realization of bricks is among “achievements” of the company’s representation.

In the summer of 2008 one of these firms has received exclusive conditions from Wienerberger and bought a large part of bricks. Having lack of understanding the market dealer couldn’t realize the production. The firm was forced to sale the stale production at a dumping price. As a result that firm has had financial losses. The Russian market of the European facing brick has been destabilized and reputation of the concern among the sellers of building ceramic has been undermined, the Wienerberger system of sales as well.

In the end of summer 2008 there were some changes in the management of the representation. However those changes didn’t have any effect towards the work with independent dealers.

«Despite market recession, the Russian representation of Wienerberger continues to compel dealers to take great volumes of a brick under nonexistent orders, - says Ilya Bocharov. - Thus each attempt to get at the representation the limited party of a brick under the concrete order threatens to turn back failure each time. Therefore in that case we can not make arrangements with our buyer”.

At the moment Wienerberger, the largest European brick producer has serious problems. 27 of 250 factories are already closed. Dismissals of 1.400 employees are planned. For first three quarters the company’s net profit has fallen to 44 % to 133 million euros. “Wienerberger could open only one of three plants the construction of which was started in Russia. However it is not working at full capacity. The launching of the other factories most likely will be postponed. By the spring of 2009 when the situation in the market will likely worsen, Wienerberger will try to maximize profits. Thus the quality of production hardly will improve”, - says Bocharov.

Wienerberger stakes on an obverse brick from Estonia TERCA on the Russian market. Its quality is better than the Russian one but it considerably concedes the West European clinker brick. Therefore the Russian market remains the most perspective for that production.

Email: info@brickford.ru