Bulgaria has enjoyed a lot of interest from Polish entrepreneurs for years. We talk to Małgorzata Beczała, Quality Managing Partner at 3CARGO and Boris Stoyanov, Sales Manager at Delamode Bulgaria Ltd, about why it is worth taking an interest in those markets and how choosing a logistics company that cooperates with a forein partner can benefit our business.
Boris, what can you tell us about the Bulgarian market from the perspective of a Bulgarian logistics operator? What prospects do you see for Polish entrepreneurs?
BS: From my experience and observation I can conclude that the Bulgarian market is becoming increasingly popular among Polish companies. It has great growth potential, which creates excellent conditions for business. Over the past thirty years, the country has undergone a significant economic transformation that has created a favourable climate for entrepreneurs to find a niche for themselves and reach a wider audience. Polish products turn out to be attractive to Bulgarian partners, and an additional advantage is the ease and speed of delivery, which is why Poland is an important trading partner of Bulgaria. In 2017, Poland ranked 10th among the largest exporters. Polish companies have signed many contracts, for example, the railway vehicles manufacturer “PESA” from Bydgoszcz has been successfully producing to order for several years and sending trams to Bulgaria. It is worth mentioning that Bulgaria has the most favourable tax system in Europe and the cost of doing business is low. In addition, it is a member of the European Union and its currency (Bulgarian lev) is pegged to the euro. Bulgaria has the second lowest public debt in the EU and one of the lowest budget deficits, making Bulgaria one of the most stable countries for doing business. Labour costs are relatively cheap, much lower than the EU average, and the transport and forwarding market is very competitive.
Małgorzata, do you think Polish entrepreneurs are keen to take advantage of these strengths of the Bulgarian market?
MB: Yes, and from our observations, as a Polish logistics company, it appears that they are doing it more and more willingly and on an increasing scale. The number of general cargo shipments to Bulgaria handled by our company increased by 12.6% in 2020, and it is necessary to take into account the fact that last year businesses had to deal with numerous restrictions caused by the pandemic. This year we expect a further increase in the number of orders.
This upward trend has led to the launch of the BULL fixed groupage line in 2018. This line operates on the basis of close cooperation between two logistics operators – Polish and Bulgarian. Why?
MB: Because this model allows us to offer our customers the best conditions in many terms – including in terms of quality, timeliness, regularity and price. The partnership with Delamode Bulgaria was preceded by numerous business meetings, joint discussions on what kind of service we intend to provide, what we want to offer our customers and what we can do together to make this service attractive and competitive. The main objective that we have pursued is to provide Polish and Bulgarian entrepreneurs, mainly from the SME sector, with permanent and timely general cargo shippments, which will efficiently and professionally serve Polish-Bulgarian trade.
BS: We have found a fair, reliable and competent business partner in 3CARGO. Our cooperation is based on shared values, smooth and fast communication, a common vision of development and, of course, good personal relationships, which are the basis for successful cooperation. In February, we celebrated its first anniversary, and we have already reached the point where we can offer our customers promotional and affordable rates through a join marketing and sales campaign, promoting the advantages of our Polish-Bulgarian groupage line. Many Bulgarian and Polish companies that have benefited from the BULL groupage line have become our regular customers, which proves the success and quality of our services.
So what are the most important benefits for the customer from such a model of international cooperation between logistics companies?
MB: Honestly Boris, you surprised me that it’s been a year already. And I confirm that good relations, shared purpose and similar quality of service are key to the success of partnership. And returning to the question, I think that among the most important advantages is undoubtedly the high standard of service, which have been very reliably established through negotiations. We have two companies here, that have jointly established their priorities and the priorities of their customers, and have put a lot of work into developing a service that will reflect them. I am talking about issues such as customer service, speed and timeliness of deliveries, regularity of departures, or flexibility with regard to the goods transported – we transport for our customers goods covered by the ADR Convention and bulky goods, such as agricultural machinery and machine components.
BS: I would add to this knowledge of the local market, without which efficient cooperation of an international nature would be very difficult. Just as 3CARGO knows the realities of the Polish market, polish infrastructure, the current legal framework, so Delamode Bulgaria knows the realities of the Bulgarian market. Thanks to this knowledge, we collect and deliver goods fast and smoothly to any place in Poland and Bulgaria, moreover, we do it at competitive rates. We also communicate with our clients, and sometimes also with our clients’ customers, in their native language, which is a great help.
What goods are most often shipped from Poland to Bulgaria?
MB: Bulgaria in 2020 was in 28th place among the most important recipients of Polish goods. The value of Polish exports exceeded PLN 5 billion, an increase of 3.8% compared to 2019 data. As far as goups of goods are concerned, last year our exports to Bulgaria were dominated by electrical machinery and equipment, plastics, clothing articles and accessories, meat and offal, furniture, tobacco, biodiesel and its mixtures and pharmaceutical products. For groups of goods, the largest percentage increase compared to 2019 data was recorded in exports of arms and ammunition (an increase of 131.6%), fats and oils (an increase of 64%), raw hides and skins, leather, furskins and articles thereof (an increase of 25.2%), prepared foodstuffs (an increase of 23.2%) and plastics, rubber and articles thereof (an increase of 15.8%).
BS: Poland is one of the best growing economies in Central Europe, which has a positive impact on trade and economic relations with Bulgaria. According to data on mutual trade, Poland ranked 10th in imports and exports between January and September 2020. Overall, in recent years trade between Poland and Bulgaria has been characterised by balanced growth and a positive trade balance in favour of Poland. In 2019, Poland exported to Bulgaria mainly: machinery, chemicals, electrical and electronic equipment, furniture, plastics, food and dairy products, clothing. Polish investors are interested in investing in energy (thermal power plants) and in the small and medium-sized enterprises sector. According to BNB data, at the end of September 2020 Polish direct investment in Bulgaria amounted to EUR 272.3 million.
What Bulgarian products are attractive to foreign importers?
BS: Bulgaria is famous for its many unique products such as wines, local specialties and herbs. On a global scale, we are one of the main exporters of lavender or rose oil, which is considered the best in the world. We produce a lot of cosmetics and food products with rose oil. The largest number – 11% of Bulgarian exports are electrical machines and equipment. Other commodity groups in the TOP 10 list include mineral fuels including oil, machinery including computers, copper, cereals, vehicles, pharmaceuticals, plastics and plastic articles, ores, slag, ash, clothing and accessories (not knit or crochet). Bulgaria’s top 10 exports accounted for 55.5% of the overall value of its global shipments in 2019.
The Polish-Bulgarian groupage line turned out to be a hit. What’s next? What are the further plans and prospects for cooperation between 3CARGO and Delamode Bulgaria? What else do you want to offer your customers?
MB: There are a lot of plans and ideas. Our companies are in the process of continuous development, which brings a constantly enriching offer. This year, for example, 3CARGO created a new position – logistics concierge. It is an innovative project that brings to the market a service sought after and desired by SME entrepreneurs all over the world. In a nutshell – logistics concierge acts as a personal assistant, who analyzes, advises and realizes all the needs of a logistical nature. We will certainly want to extend the scope of this service, perhaps to the Bulgarian market. Entrepreneurs from Poland and Bulgaria have a lot to offer the world, it is worth ensuring that they feel supported at every step in their expansion into close and distant markets.
BS: To this end, we are also constantly working to expand our reach. An undoubted advantage of Poland and Bulgaria is their geographical location, which facilitates access to numerous markets. Already thanks to our cooperation, we allow Polish companies and their goods to reach countries such as Cyprus, Greece, Georgia, Azerbaijan, Kazakhstan, Armenia. We continue our efforts to keep this list growing. Poland and Bulgaria have many links – historically, diplomatically, politically and strategically – which favors the strengthening of mutual sympathy between Poles and Bulgarians and is one of the factors determining our ever closer cooperation. As logistics companies, our task is to build, streamline and develop permanent connections and logistics solutions that will contribute to the further development of trade and service cooperation between our countries.
And I wish you that. Thank you for the conversation.
Interview by Ewelina Kłoda