Doing business in Russia: now it's as easy as ABC

Business America, Sept, 1995 by Susan Simon

For the American business traveller, Russia and the New Independent States (NIS) offer outstanding market development opportunities--and significant challenges. Until recently, access to the most basic of business services often presented the biggest difficulty. Successfully placing an international phone call could take hours or days, and represented a significant accomplishment--as well as lost time and money. Finding a computer with a laser printer was virtually impossible, and making a copy meant finding an English-speaking secretary who could type a version of your document using carbon paper. The Commercial Service's 14 American Business Centers (ABCs) are designed to help overcome these obstacles. "The ABC network of on-site business facilities and regional market expertise, offered exclusively to Americans, gives them a leading edge over other international competitors in this rapidly developing market," said Lauri J. Fitz-Pegado, Assistant Secretary and Director General of the Commercial Service.

Telecommunications Services--The southern Ural city of Chelyabinsk, rich in minerals, rare metal deposits, and raw materials for building and construction, already attracted the attention of such American companies as Coca Cola and IBM. Until the Chelyabinsk ABC helped forge a new alliance between BelCom, Inc., a New York-based telecommunication company and Sviazinform, the Chelyabinsk regional telephone company, Chelyabinsk ABC clients and these multinationals were forced to rely upon an antiquated telephone system to stay in touch with the rest of the world.

BelCom's newly-installed earth station in Chelyabinsk connects ABC clients as well as hotels, factories and business offices in the region with international telecommunications services via satellite. Their high-grade international and inter-NIS communication system will help foster economic development and cooperation between the two countries.

William Bethea, President of International Business Management, LLC, the operator of the Chelyabinsk ABC, states, "I am pleased that the American Business Center, in its earliest stage of operations, was effective in bringing together two such important players for a service as important as telecommunications. Other business development in the region hinges on the availability of reliable phone service."

Finding Business Partners--For one Novosibirsk ABC client, World Wide Sires Inc. (WWS) of Hanford, Calif., reliable phone services are an added enhancement to the market research and logistical services they have been receiving from the ABC. American and American-trained Russian professionals at the ABC who know the local business community helped WWS minimize its costs and quickly find a promising business partner in this prosperous agricultural region.

WWS had an established presence in the Russian market providing genetic material for dairy herds in the former Soviet Union. The company recognized Novosibirsk's potential as a key food production and distribution center for the vast region east of the Urals, and used the Novosibirsk ABC to expand its distribution network throughout the Russian Federation.

The Novosibirsk ABC provided an overview of the privatization situation in Novosibirsk, identified potential partners, arranged meetings for WWS's management with government officials and agricultural managers, and provided interpreters and transportation.

For small companies and newcomers to the complex Russian market, ABCs are particularly advantageous. The St. Petersburg ABC helped C. Isaac Camber, of Cambridge Scientific in Miami, Fla., locate a distributor for his company's laboratory equipment. Dr. Camber claimed he "never expected to get such a bang for his tax dollar."

Another St. Petersburg ABC client, Ovalstrapping, Inc. of Hoquiam, Wash., learned about the St. Petersburg ABC at a forestry and paper exhibition. Sales Manager Randy McClung immediately took advantage of the ABC's services, renting carrel space for three days to follow up on business leads. As a result of the progress he made while working at the St. Petersburg ABC, Randy prolonged his stay and travelled to the Russian Far East to follow up on his newlygenerated business leads.

Temporary Office Space Provisions--After identifying a Russian partner, American companies often need temporary office space while they set up joint operations or locate permanent office space. When Volga River Management won a 30 million contract from the European Bank for Reconstruction and Development to develop the Lower Volga region, including the city of Volgograd, it rented two office spaces at the Volgograd ABC. The office carrels were fully outfitted with furniture, computers, printer, and the full range of telecommunication facilities. Volga River Management had easy access to the ABC's copying, secretarial, translation and interpretation services whenever the need arose.

On-Site Logistics and Transportation Ground Services--ABC services extend beyond the office walls. With the help of the Volgograd ABC, Volga River Management hired a full-time driver and located apartment living quarters for its staff space, saving not only money, but the frustrations of hotel living as well. According to Joel Montgomery, Director of Volga River Management, Inc., "Working through the ABC has made it possible for me and my staff to concentrate on what is really important--finding investment projects. The ABC has been beneficial for relieving the burden that comes with the initial start-up of an office. We look forward to future cooperation with the Volgograd ABC."