How can a CEO analyze financial and management reporting? How to understand that something is wrong with your business.

Where to start working in a company experiencing a crisis

What questions will you find answers to in this article?

How to assess the condition of the enterprise that you were offered to head

What needs to be done before taking office

What steps should you take when starting work?

A company facing economic problems is in dire need of a leader who can effectively restructure the business. Therefore, troubled enterprises often offer very high pay to managers who are ready to work in a crisis situation. Taking into account the current state of affairs in the financial market, it is possible that in the near future such a profitable offer may come your way. But don’t rush to accept it until you are sure that the situation can really be corrected. I have worked as a crisis manager for several companies, most recently a telecommunications services company. In the article, I will share tips on how to assess the prospects for managing a troubled company and how to structure the work at the very beginning.

How to assess the condition of an enterprise

I was repeatedly offered to head plundered enterprises that had completely ceased operations. I refused because it was not possible to return them to a normal state in a fairly short period of time using the available forces and means. In such a situation, no matter what money they promise you to bring the company out of the crisis, I recommend rejecting the offer. Companies that have passed the point of no return to normal business mode do not need a fresh strategy, but technologies aimed at liquidating the enterprise and preserving the most valuable assets. I always made the decision regarding whether to “take” the enterprise or not on the basis of a balanced analysis, consistently assessing:

economic condition of the enterprise;

its position in the industry;

team performance;

availability of resources for rescue.

First stage of analysis. Economic condition of the enterprise

It is necessary to determine how quickly, given the available resources, it is possible to achieve fundamental changes in the economy of the enterprise. A distressed enterprise typically lags behind the industry's level of business performance by many years. Accordingly, in order to revive it, you must move at an extremely fast pace, that is, overcome a three to four year backlog in one year. The first source of information about the state of the company that should be on your desk is annual reports. They will allow you to assess the property and financial position of the enterprise over time. In addition, I recommend checking the financial statements for the current period (not included in the latest annual report). This is important because the situation could have deteriorated significantly recently. I start studying documents with a quick analysis. It involves carefully reviewing reports based on formal characteristics and identifying problematic articles. For example, I pay attention to uncovered losses from previous years, loans and borrowings that were not repaid on time. In addition to the actual numbers, it is necessary to study the analytical sections of the report and familiarize yourself with the auditors' opinions. After the express analysis, it is necessary to do a more in-depth analysis, which involves independently constructing analytical financial reports. To do this, you need to give the reporting a form that is convenient for in-depth analysis. As part of such a study, in particular, a vertical and horizontal analysis of the balance sheet, an assessment of the liquidity, solvency, financial stability and profitability of the company is carried out. I would like to draw special attention to the importance of analyzing financial ratios and indicators over time (financial ratio analysis). Such an analysis allows you to better assess both the economic position of the company and its place in the industry. Financial ratios must be considered, comparing them not only with each other, but also with the resources allocated to save the enterprise. A single coefficient or several separate coefficients do not provide an objective picture. One should also be wary of such a category as industry average ratios. Each company is unique, much depends on its size and business characteristics, and, accordingly, even within the same industry there is a significant spread of coefficients. Let me give you an example. At the telecommunications company where I worked, liquidity and solvency ratios were catastrophically low. But at the same time, there was an opportunity to significantly increase the business activity of our clients. The fact is that, although clients did not receive modern services from us (high-speed Internet, IP telephony, office consolidation), they had not yet switched to other suppliers, that is, they remained a guaranteed client pool for us. I decided that this situation provided an opportunity for a breakthrough, and, as it later turned out, my calculation was correct: the rapid modernization of equipment (due to loans provided with the help of shareholders) made it possible to sharply increase sales. The increase in data speed alone immediately resulted in a 40 percent increase in sales in this service segment. Within eight months, all loans were fully repaid, and liquidity and solvency ratios became excellent.

Second stage of analysis. Position of the enterprise in the industry

The goal of this stage is to understand what needs to change in the strategy to create significant competitive advantages. It is useful to comprehensively assess the state of the industry and the prospects for its development, study the strategy of the main competitors, and predict their marketing and other actions. In addition, you should compare the cost structure of your enterprise and that of competitors, and conduct a SWOT analysis. As a result, you will be able to get an idea of the competitive position of the enterprise in the industry. Unless you have worked in the industry yourself for at least the last few years, you will need the help of advisors. In a fast-growing, high-tech industry, it is extremely important to have fellow advisors from among the top managers of successful enterprises. Let me give you another example. When I was considering the opportunity to head the VPK-Telecom company, my colleagues helped me not to reinvent the wheel - they suggested promising directions for business development. The company provided access to services through PIN codes (using plastic cards). This direction was extremely promising for the industry, but the company, while developing it, was clearly suffering losses. There were several reasons: the lack of an IP telephony segment, underdeveloped business processes, low labor productivity. Logic told me: this ultra-promising direction cannot be closed - we must devote the necessary efforts to its development. But after a brainstorming session with the participation of my colleagues working in the telecommunications industry, the only correct decision, as it later turned out, was made: to immediately close this area and return to it after the economic situation of the enterprise normalizes. In my practice, I have repeatedly encountered seemingly paradoxical situations when it is better to start a business again from scratch than to try to revive an existing but illiterately created one.

Third stage of analysis. Team performance

In my experience, 98% of the existing staff needs to be replaced within two years to keep things moving forward. At the same time, a change of 100% of key personnel should occur within the first year of restructuring. There is no time and little prospect of retraining existing employees, so I consider hiring new qualified employees one of the most important factors for a director’s success in a new place. Usually, the personnel already working at the enterprise are not able to make a significant contribution to the restructuring: the rule “what is the company, so is the team” applies. If business processes in a company are organized incorrectly, a corresponding negative climate develops. I know of cases where good specialists, finding themselves in backward companies, became lazy within a year and lost their qualifications. Updating your staff will require additional significant costs from you, which must be taken into account when planning financially. Today, in many industries there is a shortage of personnel. For example, in our telecommunications industry there is a shortage of engineers and it takes more than a year to recruit a good specialist. You can speed up the process by luring workers, but in this case you have to offer a higher salary. In addition, keep in mind that the dismissal of previous employees will also require expenses in accordance with the Labor Code of the Russian Federation: in fact, you will have to pay each laid-off employee up to five average monthly salaries.

Fourth stage of analysis. Availability of resources to save the enterprise

Based on the results of the first three stages of analyzing the state of the enterprise, you can draw up a preliminary business plan. At the final, fourth stage, you have to assess whether the resources promised by your future employer are sufficient to carry out the necessary changes. Assistance can be provided in the form of favorable credits and loans, preferential rent, performing part of the work (for example, accounting functions can be taken over by a division of the holding structure), consultations, etc. Bargain. But if the help is not enough, I do not recommend that you become responsible for the further development of the enterprise. In my opinion, the most important thing during restructuring is to obtain borrowed funds at a rate that does not exceed the market average. As a rule, such funds can be provided by companies included in the holding, or by third parties under the guarantees of the holding.

What to do before taking office

If you have made a conscious decision to lead a business that is undergoing restructuring, there are several steps you should take before you take over. Namely: agree on working conditions with the owners, fixing the agreements in the contract, enlist the support of outside specialists (in case of possible sabotage of the enterprise personnel), develop an operational plan. In addition, you need to decide how to build a relationship with your predecessor. I'll try to give some useful tips.

Salary for a crisis manager

The salary should consist of a fixed and bonus part. The fixed portion must be a substantial amount. If the company has signs of bankruptcy, the fixed part should not be less than 10 thousand US dollars monthly. Immediately dismiss the employer's chatter that you need to start with a small amount, and then it will be increased at his discretion.

1. Fixed part of the salary.

I recommend using the following method. A base amount is established. Then the so-called management goals are determined - for six months and for subsequent periods. By management goals I mean the results that you must achieve over a certain period of time: for example, bring the enterprise to profitability, implement an ERP system, a billing system, create efficient branches. Achievement of each goal should be rewarded with a corresponding increase in the fixed part of the salary. For example, timely implementation of ERP may imply an increase in the base part by 20%.

2. Awards. There are many bonus schemes. I would like to recommend one of them. It is convenient to assign an annual bonus in the amount of 10% of net profit if the enterprise was unprofitable, and 10% of the amount by which net profit increased if the enterprise was profitable. This calculation is consistent with business customs. Shareholders must understand that the CEO is de facto their partner and his wealth should be largely linked to the amount within which dividends are calculated.

Terms of your contract

As a rule, the employer is in a hurry and puts off all sorts of “little things” for later. However, do not be shy - the contract must be detailed, especially in terms of wages and bonuses. It is equally important to stipulate the situation when the General Director is fired at the initiative of the employer (the amount of the so-called golden parachute). Ultimately, it is beneficial for both the employer and the future General Director to reach an agreement “onshore”. I know of cases when the job is done, the General Director has invested intelligence, resources, and time into the enterprise, and the employer, who at the start promised (in words) a large bonus, reports that he paid the General Director a high salary and believes that this is enough. According to the stories of my colleagues, defense industry leaders are especially guilty of this. One of the favorite tricks is to pay a bonus for the first year so that the General Director stays for another year. And for the second year, when the enterprise already looks like candy, no bonus is paid. I have not found myself in such a situation, but I think that it should be treated philosophically: the employer is the client, and they do not quarrel or sue the client, they simply leave a bad client. The employer punishes himself: rumors among managers spread instantly, and the reputation will certainly suffer. As a result, the negative effect of non-payment will cost shareholders more than the payment itself.

Fifth column

When changing management, there is an objective risk of failure of key equipment and business process management systems (this is especially true for high-tech enterprises). Failures are most often caused by the actions of the removed leader if he does not leave his post of his own free will. I recommend assembling your own team of professionals (not working at the enterprise) who will be able to restore the vital functions of the company in the event of sabotage or sabotage by the previous manager. It is better to enlist the support of external specialists even if the shareholders part with the previous General Director on good terms: the price of risk is too high. Imagine, for example, the consequences of equipment failure or the billing system in a company providing telecommunications services: thousands of customers will be left without communication or the company will be unable to issue bills to customers. I always protected myself by enlisting the support of key people in the industry, as well as the CFO and accountant. Forming such a team is not easy (as a rule, the people included in it work hard at their jobs), but it is absolutely necessary. Even before taking office, you should consult with team members, modeling possible problems and methods for solving them.

Operational Restructuring Program

The crisis manager is required to carry out the economic recovery of the enterprise in a short time, that is, to improve the results of economic activity. In other words, we are talking about operational rather than strategic restructuring (the purpose of the latter is to ensure high competitiveness in the long term). The economic crisis at different enterprises arises for similar reasons, and therefore solving the problems of enterprises requires well-known actions from the General Director.

Set up a management system. When you study in detail all the business processes of an enterprise, you will find that they are far from optimal. The actions of the company, divisions and individual employees resemble Brownian motion; there are unnecessary divisions that duplicate each other. The recipe in this case sounds as simple as it is difficult to implement: you need to introduce a new management system in combination with a new organizational structure.

Do not try to improve the company's performance within the framework of the old management system - it is impossible.

Only the implementation of a new system will allow you to achieve fundamental improvements. I have witnessed (but not participated in) at least a few multimillion-dollar failures in this area, and these observations lead to a number of conclusions. The ERM system being implemented should be as standard as possible for the industry - this is much cheaper and more reliable. In other words, avoid developing a system specifically for your “great” company. In my opinion, it is more correct to slightly adjust the structure and business processes of the enterprise to ERM (and not vice versa). Individual blocks of business processes may require special ERM adjustments. In this case, first your employees (but not the specialists of the provider company) will have to describe the algorithms of the enterprise’s business processes. These algorithms will then be processed by the ERM provider’s employees, after which your employees will need to re-engage to make the necessary clarifications. A multi-stage procedure will require a lot of time and effort, but otherwise distortions may be introduced into business processes.

Reconsider relationships with partners. I believe this point does not require long comments. It is necessary to restructure relationships with service providers so that they cost the company as little as possible. Unreasonable transactions and transactions at prices above market prices should be completely excluded. It's worth trying to find alternative service providers. All these actions are aimed at significantly reducing the cost of services. For example, in a telecommunications company we managed to reduce the cost of Internet traffic by several times in the shortest possible time. This was done through a reorientation to new suppliers, as well as thanks to a cost reduction scheme with increasing volume and an unlimited dynamic traffic acquisition scheme (involves a reduction in the limit as the volume decreases).

Upgrade equipment. This point is especially relevant for high-tech companies. I will give just one example from my practice. New telecommunications equipment has provided higher data transfer rates. As a result of modernization, the volume of traffic consumed by clients increased by 40%. The benefit is obvious for both clients and the company: clients have the opportunity to work much faster, and the company has additional income.

Interaction with the former General Director

Under no circumstances leave the former General Director to work at the enterprise! Not as a deputy, not even as a staff advisor. Don't give in to any persuasion. Whatever this person is, he will try to prove that you are worse than him. The best option is to agree with the former General Director that he will advise you for a decent remuneration, without being a full-time employee. In my practice, the consultation period lasted from two weeks to a month. During this time, it is quite possible to master a new job.

Tasks of operational restructuring

The general strategy during operational restructuring can be formulated as follows: it is necessary to ensure the generation of own funds and the attraction of borrowed funds in an amount sufficient to create competitive advantages, which in turn will subsequently ensure high competitiveness for the long term. During the period of operational restructuring, increasing gross revenue is not the main goal. Moreover, the pursuit of increasing gross revenue, which shareholders who are not economically sophisticated are so eagerly awaiting, can lead to failure. The fact is that the enterprise at this stage does not have the main factor for increasing gross revenue - competitive advantages. Let me explain using the example of a telecommunications company. Managers, instead of getting things done, can chase salespeople around as much as they want, but they won’t sell more if the company is not able to provide services uninterruptedly and with the required level of quality - even traditional ones (not to mention modern ones).

What to do after taking office

The first thing you need to do is record the state of affairs at the time of your arrival. When transferring cases, I recommend that, in addition to the standard set of document acceptance certificates, you must sign the register of accounts payable and receivable. It must include the following data: company name, contract amount, contract number, subject of the contract (briefly) and a laconic comment on the state of execution of the contract on the day of transfer. In this way, you will record the state of your debts at the time of your assumption of office. This measure helps to avoid “skeletons in the closet”. It happens that after the new General Director takes office, creditors appear with “properly executed” agreements and offer to pay them. Such situations arise if the previous management continues to sign documents after dismissal. After taking office, immediately begin a full inventory of property - literally throw all your available forces at it and complete it as soon as possible. Include representatives of shareholders or the holding company in the inventory commission. The purpose of the inventory is to record the existing property at the time of your arrival and begin the appropriate procedures in relation to the missing property. Once you start working, you will receive more and more reliable information about the company. As information becomes available, it will be necessary to refine the previously drawn up operational restructuring program. Typically, in problem enterprises, many issues important to the company are not resolved or are resolved very poorly. For example, a business plan is often superficially written (it should include marketing, operational and financial plans), a mission is not formulated, and a corporate identity is not developed. Often, a fundamental review of the system of bonuses for employees, public relations, and customer relationship management requires a fundamental review. In conclusion, I would like to emphasize once again that managing an enterprise in a crisis is a very difficult process. Therefore, another recommendation is not to try to manage a company in a crisis if you do not have at least three years of experience in managing an enterprise in normal business conditions.

Vladimir Benda | Crisis manager, Moscow

How can you tell if something is wrong with your business?

One of the readers of my book “How to Ruin Your Own Business: Bad Advice to Russian Entrepreneurs” wrote to me:
“I have owned a self-organized workplace for 3.5 years. Very tired. I have about 10 people working on staff and about 5 remotely.”

After reading this, I understand that this owner is not in a good business situation. In general, when thousands of different businesses pass before your eyes, you begin to determine by simple signs in which of these businesses things are not going where they should be. And if nothing changes, their prospects will be very sad.

I think you might be interested if I talk about some of these signs. Using them, you can easily understand whether the business you are considering is problematic. Or that this business has already become a big headache for its owner.

How old is the Company and how many employees does it employ?

It only makes sense to create a business in order to achieve market dominance. Or at least become one of the leading players in the market. Of course, not every business has the prospect of growing into a company that will be a world leader in its field. Therefore, you need to intelligently determine the market segment in which you will strive for a leading position. It might be a fairly narrow niche. It is possible that it will be limited geographically. But in this niche you must take a leading position. And at the very least, make every effort to achieve this.

You may ask - should every business strive to become a leader in its market segment? What's wrong with running a sustainable, stable business that generates revenue every month while occupying a small market share? The main reason is that it is unsafe. In the event of tougher competition and the entry of strong federal and transnational players into the market, Companies that have captured a significant market share have a better chance of surviving. “While the fat man dries, the thin man will die.” It is easier for companies with a more serious scope of activity to maintain highly competitive conditions for working with Clients. It can provide its Clients with a more worthy level of service. Due to the larger scope of activities, it is easier to ensure an acceptable margin. Accordingly, such a business has a greater margin of safety. Even in a difficult situation, when the entire market is in a steep dive, such a Company has a good chance of surviving. It may be necessary to sharply reduce costs and fire some employees. But the business will survive. And later he will be able to rise again.

And small Companies often have no safety margin at all. There is not even a financial cushion that would allow them to survive for several months in the event of a sharp deterioration in the market situation. At the same time, they often do not have very competitive conditions for servicing clients. It is clear that they are trying to compensate for this through an individual approach to Clients and building personal relationships with Clients. And every demonstration of love for Clients. However, with a sharp deterioration in the situation on the market as a whole, all this turns out to be completely insufficient. Therefore, every time there is frost on the market, small Companies die like flies.

Conclusion: in order for your Company to have the opportunity to live happily ever after and, if necessary, successfully survive the next market downturn or tougher competition, it must be a medium or large business. Very few businesses can be sustainable, viable and successful with a small team.

Therefore, it makes sense for the owner to strive to develop his business quickly and actively. At least until this business has sufficiently increased its turnover, client base and team of employees to take a stable position in its market niche.

In general, if by the end of the first year of operation your new Company has 20 full-time employees or more, this indicates a good pace of business development at the initial stage. The same can be said about the Company if, after 2 years from the date of commencement of work, the number of its employees is 40 people or more. On the contrary, if the Company is already 3 or 4 years old, and its number of employees is still less than 20 people, this is a very bad sign. If at this moment there are only 15, or even 10, employees, the situation is extremely regrettable. Most likely, the problem is that the owner does not know how or does not want to develop his business.

In addition, there is one more factor to consider. Most Russian business owners do not actually own a business, but a self-organized workplace. In such Companies, the owner is by no means a free person. He is a key executive and absolutely essential to the day-to-day running of his Company. Responsible for everything, a slave to his own business. Often he cannot even go on vacation without damaging his own business. Many of these owners do not go on vacation - for 5, 10, or even 15 years.

Conduct an audit

To build a full-fledged business system, the Company requires a headcount of 30 people or more. If the number of the Company is 100 people or more, many elements of the business system have already been built in it. Otherwise, she simply would not have grown to such a size. While your Company has only 10-15 employees, you are practically doomed to be the owner of an independently organized workplace. And this is another reason why it makes sense for the owner to quickly develop the Company at least to the size of a medium-sized business.

How many managers and ordinary employees does the Company have?

The inherent flaw of many Russian Companies is that the owners and creators of these Companies do not understand the essence of the work of a manager. For some reason they think that ordinary employees do all the work. A manager is a person who receives a large salary and does nothing particularly useful. As a consequence of this approach, their Companies have a serious shortage of management. And since the need for the work that the missing managers would have to do has not disappeared, the owners themselves find themselves up to their necks in managerial turnover. At the same time, the efficiency and intensity of the work of ordinary employees is extremely low, since they constantly lack managerial influence. The classic picture: ordinary employees are idle half the working day. And they constantly stand in line at the director's office for instructions on what they should do. At the same time, the director works 10-12 hours a day, almost seven days a week.

How to check whether the Company has a serious shortage of management personnel? Very simple. To do this, you need to know how many employees the Company has, and how many managers of all ranks. With a classic hierarchical management structure, each Company employee must report to someone. This also applies to the Company's managers. Except for one, located at the very top of the pyramid. Therefore, one needs to be subtracted from the total number of employees of the Company. This refers to the general director and owner. Dividing this number by the number of managers of the Company, we obtain the ratio: how many employees are there per manager.

And now it’s time to remember that when performing more or less complex and atypical work, the controllability limit is 5-7 ordinary employees per manager. If we get a ratio close to this, it looks very likely that everything is fine. If the number of ordinary employees per manager is 10 people or more, the state of such a business can be characterized in two words: a complete mess.

How many hours a week does a business owner work?

No paid job is worth spending more than 40 hours a week on. More precisely, during this time you need to be able to consistently provide decent results. If you overwork, then I hope that the results will be outstanding. For simply good results, 40 hours a week should be more than enough.

This principle applies no less to business owners. Moreover, many of the exclusive functions of a business owner are extremely difficult to perform in the office, amidst managerial turnover. First of all, we are talking about thinking through the organization’s development strategy. And also about the development of various documents, technologies and standards necessary for the improvement and development of business. Including plans for the development of this very business.

Therefore, if the owner is consistently in the office of his Company for more than 40 hours a week, or even more than 60 hours a week, then he is incompetent as an owner. Of course, there are situations when the owner just wants to work hard for the development of his Company. For example, when a business is growing so successfully that it would be a sin not to make additional efforts to become the absolute market leader. Okay, let's be honest with each other. Is your Company already a market leader? Maybe you have the prospect of becoming a leader in the next year or two? No? Then why the hell are you working so hard like Papa Carlo, Mama Carlo and the whole Carlo family?

If the owner is in the office of his Company on average 30-40 hours a week, he is not a real business owner. But just the manager of a self-organized workplace.

If the owner is in the office of his Company for less than 20 hours a week, and at the same time the business makes good money and develops successfully, the situation looks much more attractive. If everything is fine with the business, and the owner comes to the office once a week, or even once a month, it is very similar to the fact that this is a real business owner.

What documents does the business owner sign?

The real owner of the business signs only the constituent documents and powers of attorney for the right to sign. For everything else there are executive directors. If you have to sign new documents every day, you are just the manager of a self-organized workplace.

Who manages the business finances and checking account?

Likewise, if every day you have to make decisions about who to pay and how much, you are just the manager of a self-organized workplace. For a real business owner, financiers do this work. And if you also send payments yourself through the “Client-Bank” system, it’s a joke!

How much money does the business bring to its owner?

If you are a business owner, and as you read my article, your mood becomes increasingly deteriorating, it is possible that now I will completely ruin it for you. You see, a business that does not bring its owner sufficiently tangible income cannot be considered a business. For example, if the owner makes about the same income from his business as he could get from working for another Employment Company, why the hell is he even in that business? After all, the owner bears financial responsibility for the business. It happens that under unfavorable circumstances, owners have to sell apartments, cars and cottages in order to pay off their debts. And the hired employee receives a salary every month plus interest and bonuses. And in the overwhelming majority of cases it is unlikely to go into the red. Finally, in Russia every business owner is a criminal. From the moment of the first posting to the first legal entity registered by him. This is how our legislation works. And it doesn’t matter that you are running a clean, honest, absolutely transparent business. There will always be articles on which you can be hooked and imprisoned. And people who want to do it.

This means that it is completely pointless to fall under the most severe risks inherent in a business owner. And as a result, receive the same income as many employees who work for hire.

Therefore, it is believed that a business in an average Russian city with a population of one million has the right to exist if it provides its owner with a dividend income of at least 10 thousand dollars per month. That is, 300 thousand rubles per month or more. We are talking about net dividend income: the amount that is withdrawn from the business every month and transferred to the owner. And then it is spent by him on his own behalf. All types of payments that the owner receives from his business are summed up: salary, payments under an employment contract, dividends, etc. Funds earned by the Company in the form of profit and aimed at investing in the development of the same business are not taken into account here. If a business has several owners, the business must provide such dividend income to each of them. Of course, I'm talking about the main owners, and not about minority shareholders with small blocks of shares.

For Moscow business owners the criterion is different. In this case, the owner's net monthly income must be at least 30-50 thousand dollars or more.

Conduct an express audit of the sales department yourself using 23 criteria and identify points of sales growth!

Conduct an audit

What if your Company cannot provide its owner with such income? And moreover, do you see any prospects for a business owner to reach this level of income in the next few years? In this case, it is possible that the most reasonable thing is to immediately close the business.

Does a business owner acquire property?

Let's say a business brings its owner a fairly good income every month. But is this income used for future use? Does the owner acquire expensive personal property that has a significant resale value?

For example, before us is a business owner who has owned his Company for 7 or 10 years. Question: what did he earn for himself and his family during this time? Did he buy an apartment or several? Cottage, dacha? What of this is owned, what was purchased with a mortgage? What is the remaining mortgage balance? Or was the mortgage paid off early? Does the business owner have a financial “safety cushion”? Just for yourself, or also for business? Does the business owner make investments on his own behalf? Does he have investments, including real estate, that provide him with passive income?

If someone has been the owner of a business for many years, and in all these years has not even purchased an apartment, it is highly likely that the financial collapse and collapse of this business can be predicted. Before us is a person who, perhaps, knows how to earn money, but does not know how to save it. Such an owner in itself is a necessary and sufficient condition to put an end to the business.

Who attracts corporate clients?

Corporate Clients - organizations and enterprises - are much more attractive financially than individuals. Therefore, corporate clients need to be given the closest attention. Attracting them is the most important condition for the successful development of a business and the growth of its income.

It is surprising that in many Companies no one is involved in attracting corporate Clients at all. Moreover, these Companies can and want to serve corporate customers. At the same time, they sit passively in the office and wait for corporate Clients to contact them for goods or services. Of course, they just dream of doing it! Especially Sberbank, Lukoil and Gazprom.

In other cases, actions to actively attract corporate customers are taken by a single employee of the Company. Namely, its director. In free time from other duties. Which the further you go, the less. Imagine that there are hundreds of potential corporate customers who could work with this Company. Or thousands. Or tens of thousands. And how many such Clients can a director who does this alone, and not all the time, be able to attract? At best - several dozen.

It is possible that even working with these Clients, the Company will be able to earn some money every month. But the very first serious intensification of competition in the market or recession will leave this business with horns and legs. Or they will simply finish him off on the spot.

How many meetings per week do sales managers conduct on-site with clients?

The situation changes for the better if the Company's management decides to form an active corporate sales department. The employees of which will actively attract new corporate Clients - organizations and enterprises. This is certainly a step in the right direction. But even here, not everything is so simple.

The most common problem in sales departments is low employee activity. A small number of calls and meetings with Clients, which they conduct every day and every week. Sometimes it comes to complete reluctance to go to negotiations with Clients. Sales department employees can at any cost avoid on-site meetings with Clients, even if the Clients are in the same city. And even more so they try to avoid visiting Clients if these Clients are located in other cities, regions and countries.

But the main thing that allows you to achieve success in corporate sales is personal contact, personal relationships and personal connections. And the main tool for creating and developing all this is personal meetings. And do you really think that when negotiating a contract for a large sum with a Client from another city, the factor of personal relationships and personal meetings is less important than when negotiating with Clients from your own city? On the contrary, in this case it is even more important.

Thus, the main thing that sales managers should do is to conduct a large number of negotiations in personal meetings with Clients. Let's take teams of sales representatives as an example. In a well-established business, the sales representative conducts meetings every day along a pre-planned daily route. Moreover, each such daily route includes from 12 to 25 points. This is exactly the number of meetings a sales representative makes every day while traveling to customers’ premises.

What if we are negotiating with Clients about more complex and expensive projects, goods and services? Let's say we have to conduct multi-stage negotiations with Clients. To conclude a deal, you will have to hold many meetings, and the duration of each meeting can be from an hour to two hours. And to conduct these meetings, you will have to travel to Clients in different areas of the city. In this case, to effectively conduct commercial work, each sales manager must conduct two or three such meetings with Clients every day. Every week - from 8 to 15 such meetings.

When making interregional sales according to the “traveling teams” scheme, the business trip schedule is planned in such a way that merchants spend half or more than half of their working days on the road. Moreover, for every day when businessmen are on a business trip in another city, they pre-arrange from 4 to 6 meetings with Clients. To hold at least 2-4 such meetings.

How many meetings per week do your sales department employees conduct on-site with clients?
From 3 to zero? Or do you simply not know how much? And are you still wondering why you get the feeling that your business is making significantly less money than it could?

How often and what kind of training is carried out in the sales department?

Most of the sales managers you can hire from the labor market do not know how and are not able to sell. They can't even make a basic cold call. They may have been doing this work for several years in various Companies. But no one ever taught them anything. And they themselves also learned little. Such “cannon fodder” is unlikely to provide you with record sales results.

Therefore, in a professional sales department, after each recruitment, an adaptation program is carried out. It includes basic training and lasts at least one full day. Or even 3-5 full working days.

After this, in-house sales training is regularly conducted for the entire sales team. Every week, at least once a month. All this is done in-house. Usually - by sales managers, starting with the commercial director.

Plus, every two to three months, at least once every six months, professional two-day sales trainings are held for the entire team. To do this, they can use their own business trainers or attract outside trainers.

It is also necessary to train businessmen in the specifics of goods, services or turnkey projects that the Company offers to its Clients. For technically complex business specifics, the volume of such training is no less than the volume of sales training.

How often are employees trained in your sales department? Once a year? Never? Should you teach yourself from books? If they didn’t know anything before they came to you and don’t learn anything from you, what kind of sales do you expect?

How many bosses are there in the sales department? Are they in sales?

Many company managers believe that the main thing is to recruit suitable employees into the sales department who know how to sell. Get them interested in motivation. Offer attractive percentages and sales bonuses. And they will sell. What a misconception!

The vast majority of sales managers, left to their own devices, make three to five times fewer calls and meetings than they could. Accordingly, they sell several times less than they could. At the same time receiving the same salaries. And this is just the beginning of a long list of problems...

Sales managers, left to their own devices, are capable of virtually nothing. To get the value they deserve, it is imperative that they are led by professional sales executives. At the same time, one sales manager is also completely insufficient to effectively manage a sales department. To do this, you need at least 2 sales managers working in a hierarchy. Together they will be able to cope with the management load, the volume of which is truly colossal in a professional sales department.

For example, to effectively manage a professional sales team, 13 management activities must be carried out. 3 daily, 2 weekly and 8 monthly. And you can be sure: if the sales department does not conduct morning operations every day, there is no way to talk about any effective management of this department.

You can read more about the functions of sales managers and the necessary management activities in my book “Building a Sales Department: Ultimate Edition.”

And real sales leaders are field commanders. They run their sales department not on a “do as I say” basis, but on a “do as I do” principle. A sales manager who does not actively participate in negotiations with Clients and does not close deals is a pathetic, incompetent bastard.

Perhaps after reading this article you have a suspicion or even confidence that not everything is in order with your business. It is also possible that you would like to analyze in more detail what the state of affairs is in your sales department. Plus, it would be useful for you to find out what your management style is. This will allow you to better understand your strengths and weaknesses and draw appropriate conclusions.

YUKOS poses as a Russian oil leader, although the real state of affairs in the company looks somewhat different

A month and a half ago, oligarchs or, as they are now commonly called, representatives of big business met in the Kremlin with Vladimir Putin. At the meeting, as you remember, Mikhail Khodorkovsky noted. He directly asked the president why the state-owned Rosneft needed to buy the Severnaya Neft company at exorbitant prices and why state representatives did not react to this. The head of YUKOS also complained about the scale of corruption in the tax authorities. The answer was not long in coming. The President made it clear that whoever, but not Khodorkovsky, has the right to act as a judge: YUKOS has the largest oil reserves - “how did he get them”? The head of state also touched upon the tax issue, noting that at one time YUKOS used various methods of tax evasion. As a result, Mikhail Khodorkovsky had to hang his head and swallow what was said. Meanwhile, the rebuke that the president gave to the head of YUKOS had been brewing for a long time. The fact is that over the last year and a half, Mikhail Khodorkovsky has been actively positioning his company as, if not a standard commercial structure in all respects, then, in any case, the best of what is now in Russia. Raising the issue in this way would hardly excite anyone if not for one “but”: YUKOS claims an exceptional position in the oil community and requires special treatment from the state. Especially now - after the loud announcement of the purchase of Sibneft. Hence the teachings, the public manifestation of integrity, the loud denunciation of social ills and shortcomings. True, not everyone is ready to agree with the role that YUKOS has assumed for itself, since both the recent past and the present life of the company cannot in any way be an example to follow.

Someone else's stock doesn't suit his pocket

Indeed, the hydrocarbon reserves owned by YUKOS are impressive. This is what every company in the world dreams of. In accordance with the results of an international audit conducted by the consulting company Miller&Lents, as of January 1, 1999, YUKOS's proven reserves amounted to over 11.3 billion barrels or more than 1.54 billion tons of oil. Of these, developed reserves account for 3.4 billion barrels - over 460 million tons, and probable reserves - 4.7 billion barrels or about 640 million tons. The proven reserves of the main producing enterprise Yukos Yuganskneftegaz reach almost 7.7 billion barrels (over 1.05 billion tons), Tomskneft - 2.209 billion barrels or about 300 million tons.

However, the method of acquiring, or rather taking away, these reserves, as the Russian President reminded Mikhail Khodorkovsky, is also impressive. In April 1993, in accordance with a government decree, the open joint stock company YUKOS was formed, in which the state received 45% of the authorized capital. In March 1995, the President of ONEXIM Bank, Vladimir Potanin, on behalf of a banking consortium that included Imperial, Capital Savings Bank, Menatep, Alfa Bank, Russian Credit and others, proposed a deal to the government: banks were ready to lend to the government in exchange for the right to manage government stakes. The bankers chose the moment very well. The country was groaning from non-payments. It seemed like no one was paying anyone everywhere. Let's say, at that time, oil companies alone owed the state 7.536 trillion. rub. To imagine the real weight of this amount, it is worth saying that it would be more than enough to eliminate the debt in payment of pensions, salaries for the military, employees of the Ministry of Internal Affairs, the FSB, miners, etc. and so on. The transfer of state shares as collateral did not imply their return to the state, since there were no funds in the budget for this. As a result, the state turned out to be, as they say, in its own interests, since the amount it received from the sale of Yukos was a real pittance. To be convinced of this, just look at how much oil the company produced and sold.

In 1996, YUKOS produced 36.17 million tons of hydrocarbons, of which a third - approximately 12 million tons - was exported to non-CIS countries. In 1996, the price of Russian oil on the world market averaged $20.81 per barrel or $153.2 per ton. It is not difficult to calculate how much was received: $1.84 billion. This, we repeat, is for one year and only from the export of crude oil to non-CIS countries. Against this background, the slightly more than $310 million spent by Mikhail Khodorkovsky for 78% of YUKOS shares looks like a mocking figure.

Main production and refining capacities of YUKOSSIBNEFTI

Assets included in NK Slavneft

AFFORDING MONOPOLYST

The grumbling of drivers at Krasnoyarsk gas stations today is generously flavored with choice obscenities

“Since the beginning of the year, gasoline prices in Krasnoyarsk have doubled and in the last month alone by 60 percent... The monopolist of the Krasnoyarsk oil products market is NK Yukos, which owns the Achinsk oil refinery. ...Seeing this, some business entities began to directly negotiate the supply of fuels and lubricants not with YUKOS, but with the Ufa enterprise Bashkirnefteprodukt. Bashkir oils cost Krasnoyarsk residents about twice as much, and gasoline and diesel fuel are about 20% cheaper than Yukosov ones, despite the fact that delivering fuel from Bashkiria is much more expensive than from Achinsk. “It is very difficult to talk about the pricing policy of NK Yukos, which clearly occupies a monopoly position in the region,” says Tatyana Krylova, chairman of the price committee of the Krasnoyarsk Territory administration. - YUKOS, according to expert estimates, is pursuing a discriminatory policy towards our region. His enterprises are present in both the Irkutsk region and Khakassia, but selling prices there are lower than ours. I consider the explanations given now by YUKOS representatives (seasonal surge in prices, inflation, etc.) to be unfounded.”
Sergey Afanasyev (www.flb.ru, 06/18/2002)

Great company. From others

Judging by the huge poster hanging at the Moscow office of Yukos, this oil company is the leader in the industry. In principle, this is also evidenced by statistical data regarding oil production. But the numbers, no matter how sound they may be, do not always reflect the real state of affairs.

In 1997, YUKOS produced 35.25 million tons, in 1998 - 44.6 million, in 1999 - 44.5 million, in 2000 -49.55 million tons, in 2001 - 58, 07 million tons, in 2002 - 69.5 million tons. As you can see, from year to year the company is increasing oil production, and in fairly large volumes. To a certain extent, this is, of course, due to increased operational efficiency. Let's say, immediately after the default - - in 1998 - - YUKOS created independent companies to manage mining and processing assets, which led to a reduction in costs. However, the main reason for the growth in oil production, which YUKOS representatives hardly talk about, lies elsewhere.

Unlike the fields owned by other oil companies, those owned by Yukos are either at an early stage of development or have not yet been developed. In this regard, the average productivity of a well at YUKOS is 20 tons per day, and the average flow rate of new wells is 140 tons per day, while the national average these figures are significantly lower - 8 and 27 tons, respectively. The difference is obvious. YUKOS also has one more significant advantage. More than a third of all oil reserves are concentrated in three fields - Mamontovskoye, Prirazlomnoye and Priobskoye. The latter was discovered in 1982, and its recoverable reserves are estimated at 680 million tons of oil. Such a strong concentration of reserves makes it possible to save large amounts of money when creating the necessary infrastructure, which is reflected in the cost. Let's say, now Yukos's oil production costs are $2.5 per barrel, while for other companies this figure is much higher.

Former Minister of Fuel and Energy of the Russian Federation (August 1999 - May 2000) Viktor Kalyuzhny, former Minister of Finance of the Russian Federation (September 1998 - September 1999) Mikhail Zadornov and former Chairman of the Federal Securities Commission (March 1996 - September 1999 .) Dmitry Vasiliev is united by one circumstance: they were forced to resign “on the initiative” of the guys from YUKOS. Kalyuzhny at one time did not give VNK to Khodorkovsky, Vasiliev actively defended the small shareholders of YUKOS, and Zadornov tried to impose an additional tax on the oil barons... The question arises, who really runs the government? Is it really the Prime Minister?

"We will be left alone with the monster"

Vladimir Achertishchev, State Duma deputy:
“Today, 69 countries around the world produce oil and gas. Of these, only two gave the spoils to private hands. This is the USA (a hundred years ago). And Russia... We remember Yeltsin’s privatization, when industries went into private hands for pennies, but for some reason we don’t remember the glaring fact that the first Russian president gave natural resource rent to the oligarchs. It is no coincidence that Mr. Khodorkovsky calls his personal capital 7.8 billion dollars; the vice president of an oil company receives 150 thousand dollars... per month. Where does this enrichment come from? Due to excess profits, which are the property of the state. In 67 countries around the world where state-owned oil companies are involved in production, excess profits are used to fill the budget.”
(“Tyumen News”, November 21, 2002)

It's all natural, it's all mine

In a word, YUKOS was not just lucky with reserves and specific deposits, but fabulously lucky. But, drawing on ultra-high natural rent, the company's owners consider this quite normal. Furthermore. They greet with hostility any government movements aimed at establishing at least minimal order in the area of reserves. This concerns, in particular, the proposal of the Ministry of Economic Development and Trade that hydrocarbon resources transferred to companies before 1993, when licenses for fields were issued free of charge and without competitions, should be taxed. In principle, the owners of YUKOS are guided by the same motives in their struggle against the application of Production Sharing Agreements (PSA) in Russia. True, slogans like “undermining national energy security”, “declining budget revenues”, etc. are widely used here. But this kind of argumentation can only influence ignorant people. According to Mikhail Khodorkovsky, the work of oil companies based on the national tax regime brings more income to the state treasury than under a PSA. But for some reason he does not develop this idea. The fact is that if the PSA were used, YUKOS would have to pay the state much more than it does now. It is precisely the PSA regime that assumes that the state, during negotiations with the investor, can obtain the most favorable conditions for itself, say, an additional part of the natural resource rent. Now YUKOS, despite its privileged position, is in equal conditions with other oil producers in terms of taxes. He, for example, pays the state a production tax at the same rate of 16.5% of the cost of oil as others, although he is developing fields with increased productivity.

However, the main danger in the PSA for Yukos owners lies elsewhere. With the widespread use of this mechanism, which acts as a real competitor to the traditional system, they should prepare for a decrease in the company's capitalization, which currently amounts to about $21 billion. Moreover, we are talking about reducing not abstract, but very specific income. Let us recall that Mikhail Khodorkovsky owns 9.5% of YUKOS shares, therefore, his personal stake in the company is close to $2 billion. Large blocks of shares and, accordingly, huge personal fortunes are also owned by: Leonid Nevzlin, who was until recently a member of the Federation Council - 8%, the head of the Menatep group Platon Lebedev - 7%, State Duma deputy Vladimir Dubov - 7%, Yukos Vice President Mikhail Brudno - 7%, President of the Yukos-Moscow company Vasily Shakhnovsky - 7%. It is clear that fluctuations in capitalization in one direction or another directly affect the state of personal pockets.

Over the past year, Yukos provided 49 percent of its production from just three license areas, and has... 220 licenses

P. Buchnev, Deputy Director of the Oil and Gas Complex Department of the Sakhalin Region:

“The PSA regime is inconvenient for some of our officials, and even the oil kings, because under it you can’t steal or hide anything. One of the newspapers published an article about who organized the “roll-up” on the PSA. She believes that this is the owner of YUKOS, M. Khodorkovsky. I dare to suggest that “comrade YUKOS” is afraid of state control, because under a PSA, all details and budget items are agreed upon many times, one might say, down to the last cent, at several levels. But what kind of Russian oligarch can withstand this! I'm not even talking about the accounting of raw materials extracted by Molikpaq, which is maintained by customs to the nearest liter.

Mr. Khodorkovsky assures everyone that we have enough investment in our country, and the proven oil reserves will last for 150-200 years, so, they say, we can do without a PSA. But here's an interesting fact. Over the past year, YUKOS provided 49 percent. its production from only three licensed areas, and has... 220 licenses. It’s easy for him to talk about countless reserves. And, apparently, he wants to prolong his position in the oil market as much as possible. Dictate prices, receive excess profits. But there is no real desire to invest in Sakhalin.”

(“Soviet Sakhalin”, 03/07/2003)

Why did YUKOS become so xrenovo

It should be especially noted that in terms of capitalization, YUKOS is far ahead of other oil companies. For example, the market value of LUKoil, which produces even more oil, is only about 12 billion dollars, Surgutneftegaz - 10.5 billion, Sibneft - about 10 billion, Tyumen Oil Company (TNK) - about 5 billion dollars. As you can see, on the domestic oil scene, YUKOS is the absolute leader in this indicator. According to company representatives, as well as experts, it was possible to reach such a high level not only due to high production results and cost reduction. Two years ago, YUKOS management took global standards of corporate governance as a guideline: back in 1998, the company got rid of non-core assets, in 2000 it introduced independent members to the board of directors, since 2001 it began publishing financial statements in accordance with international GAAP standards, adopted a corporate governance code, began issuing ADRs, and in 2002 disclosed information about the ownership structure. True, they are not going to remove the owners from management, as is customary in the civilized world. Nevertheless, it seemed that in almost all areas the company was keeping its mark. However, it has recently become clear that this is not entirely true. In mid-February, the Russian companies Alfa Group, Access/Renova and the British BP (BP) announced the creation of a new structure on a parity basis, which will include the Tyumen Oil Company (TNK), SIDANCO and British-owned oil assets in Russia. As a result of this, a company will appear in Russia that will be one of the three largest after LUKoil and Yukos: its reserves will amount to 9.488 billion barrels of oil, and its daily production volume will be 1.2 million barrels. Russian companies will contribute to the new structure 97% of the shares of TNK, 56% of the shares of SIDANCO, 29.11% of the shares of Rusia Petroleum, which owns the license to develop the Kovykta gas field, as well as shares in the Sakhalin-4 and Sakhalin-5 projects " In turn, BP transfers there 25% plus one share of SIDANCO, 32.95% of shares of Rusia Petroleum, its shares in Sakhalin-5 and in the gas station business in Moscow. For owning 50% of the shares of the new company, BP must also pay an additional $3 billion in cash and $1.25 billion annually for three years in the form of its own shares. For the owners of YUKOS, it was an extremely unpleasant surprise that one of the world's oil leaders paid attention to a Russian company that was not among the favorites. In other words, Western investors were guided not by the formal indicators that YUKOS demonstrates, but by completely different values. Accordingly, YUKOS dug out the old adventurous idea with YUKSI from the storerooms, wiped it with a rag and announced at the end of April the takeover of Sibneft for $3 billion.

Dark corners of the shiny pyramid

Under the glittering shell of YUKOS, if you look carefully, there are many places that do not correspond to this festive aura. It is worth saying, for example, that today company leaders are doing everything possible and impossible to show how loyal they are to minority shareholders. But this is not entirely successful, since the events of the late 90s are still fresh in the memory of the oil community, as well as shareholders. After the acquisition of the Eastern Oil Company, YUKOS management, without exaggeration, dealt with the owners of small blocks of shares. The Federal Securities Commission (FCSM) even joined the ranks with them, and its head, Dmitry Vasiliev, with the help of YUKOS, was forced to resign in the fall of 1999. By the way, the long-term war with minority shareholders, whose interests were represented by the well-known Kenneth Dart, cost the company 15-20 million dollars. However, it was not only minority shareholders who felt the heavy hand of YUKOS owners. In 1993, following an international competition, the American company Amoco, which became part of BP in 1998, received the right to act as an exclusive foreign investor in the development of the Priobskoye field. In the fall of 1999, first the State Duma and then the Federation Council adopted a law on the development of this field under the terms of a PSA. But the partnership did not materialize. YUKOS, in fact, squeezed BP out of the project, and it was forced to leave without a break, without even receiving compensation for the funds invested in its implementation. By the way, from the point of view of foreign investors, the development strategy of YUKOS looks somewhat strange. World-class oil companies receive their main profits from the sale of refined products - petroleum products, liquefied gas and petrochemicals, while only 30-45% of income is generated from the sale of crude oil. However, YUKOS's strategic policy is based on the fact that in downstream, that is, in oil refining and sale of petroleum products, only those assets are of interest that, in the words of Mikhail Khodorkovsky, “increase our oil sales capabilities.” Although it is known that in the face of unfavorable price conditions on the world market, those companies that are widely represented in the processing sector have the strongest positions.

Who is afraid of Valery Hartung

“Deputy from the Chelyabinsk region, member of the Committee on Budget and Taxes Valery Gartung (Regions of Russia group) introduced to the State Duma a bill “0 rights of Russian citizens to income from the use of natural resources of the Russian Federation.” This document spells out a mechanism for the redistribution of the so-called natural rent - income from the production and use of oil, gas, ore, timber and other national resources in favor of each of the 140 million Russians. According to the deputy’s calculations, this will allow each resident of the country to annually receive up to 300 USD into their personal account... Cor.: Valery Karlovich, your opponents say that the redistribution of natural resource rent across Hartung will lead to the fact that the oil industry will lose its investment component. For example, the head of YUKOS, Mikhail Khodorkovsky, recently complained about the lack of working capital. And then you still have to share with 140 million other Russians...

Hartung: There are not enough funds to update funds and equipment only because the owners of oil companies are busy enriching themselves. Crazy profits of 200-300 percent are either exported abroad or gather dust at home. I agree that part of the rent should be used as investment for the development of production. How much should go to the budget, how much to the personal accounts of the population - these are issues that are subject to discussion. There is one more important nuance. If you give all the rent to the population, then only at the expense of a 13 percent income tax can you form a federal budget! This means that there will be no need to levy taxes on the processing industry. Here is the path for developing tax reform, about which there is so much debate today.”

Interviewed by Dmitry Sevryukov (“Tribune”, 04/10/2003)

Tax wastelands of Mosalsk

There are a lot of questions for YUKOS from environmentalists as well. Judging by official statements, there is simply no company more “green” and dedicated to preserving nature. In fact, as evidenced by the Angarsk-Daqing oil pipeline construction project, the opposite is happening. YUKOS, for example, is not even bothered by the fact that there is a very high probability of pollution of Lake Baikal.

It must be said that YUKOS speaks about its obedience to the law on any occasion and at all angles. True, obsessive self-promotion is always alarming. Moreover, just five years ago, companies controlled by Mikhail Khodorkovsky were very successfully implementing completely different principles. Until 1997, in the small town of Mosalsk, Kaluga Region, at the address: Lenin Street, building 42, more than 30 legal entities were registered, one way or another connected with Rosprom. At the site where, in theory, the office of one of Russia's largest industrial holdings should be located, there was a vacant lot with one boarded-up and two crumbling houses without windows or doors. Previously there was a vegetable drying plant here. But that's not the point. In 1997, Rosprom transferred about 1 billion non-denominated rubles in the form of VAT to the Mosalsky district tax inspectorate. That is, from a company that owned huge assets, for the whole year, at the then exchange rate, a little more than 160 thousand dollars were received. By the way, in February 1997, Rosprom took over the management functions of YUKOS and it was then that Mikhail Khodorkovsky became the chairman of the joint board of Rosprom-YUKOS.

Watch your hands

At the same time, the oddities and mysterious moments in the history of the acquisition of attractive assets by Mikhail Khodorkovsky’s structures are not limited solely to oil. Therefore, at a meeting with the oligarchs, Vladimir Putin could well have given other examples. Fortunately, the head of state is constantly reminded of this. At the end of 2002, the governors of the Smolensk, Tambov, Tula and Novgorod regions sent a letter to Prime Minister Mikhail Kasyanov and the Prosecutor General’s Office, in which they asked to return a 20% stake in Apatita OJSC to federal ownership ", which is illegally owned by the Rosprom-Me-natep group. Furthermore. Murmansk OJSC Apatit, controlled by this group, is a monopolist in the production of apatite concentrate and literally twists the arms of enterprises working on this raw material. In particular, the Novgorod-based Akron plant, which supplies more than 30 Russian regions with chemical fertilizers, was forced to purchase apatite last year at $43 per ton, while its cost was only $15. OJSC Apatit artificially inflated the price by selling raw materials through intermediary companies. As the governor of the Smolensk region, Viktor Maslov, said at the time, this constitutes “economic terrorism.” According to him, every year OJSC Apatit withdraws up to 250-300 million dollars of its profit from taxes through offshore zones. Last December in Smolensk there was a protest rally by workers of Dorogobuzh OJSC, who called on the President of the Russian Federation, the Prosecutor General and the Minister of Agriculture to take effective measures to curb the arbitrariness of Apatit OJSC, introduce state regulation of prices for apatite concentrate, and from the Rosprom group -Menatep they demanded to abandon dishonest and illegal business methods and return to the state the 20% stake in Apatit that it had appropriated. But to date, no significant changes have occurred either in the policy of the Rosprom-Menatep group or in the actions of the Apatit controlled by it. One cannot help but recall the story associated with YUKOS’s attempt to take control of the Talakanskoye oil, gas and condensate field in Yakutia. The central block of this field with recoverable reserves of 124 million tons of oil and 47 billion cubic meters. meters of gas was put up for competition in 2001, and YUKOS met it fully armed. Mikhail Khodorkovsky’s company found a simple and very elegant solution by taking on the small Yakut company Sakhaneftegaz as a partner. This alliance, which offered a gigantic bonus of 0.51 billion. dollars - and won the competition. True, it soon became clear that YUKOS was not going to pay this amount. The calculation was made that the government of Yakutia would “forgive” the republican part of the bonus in the amount of $300 million. It is curious that this should have happened at a time when Yakutia suffered from severe flooding and was forced to ask the federal center for financial assistance. However, this did not bother YUKOS. However, at the last moment local deputies came to their senses and refused to approve the relevant bill. In a word, the pyramid, which is located on the YUKOS corporate banner and which, apparently, should symbolize the power of action, spiritual strength and harmony of thinking, looks pretty skewed. Apparently, this is why Mikhail Khodorkovsky and his associates are so actively correcting it, although, as you know, the supporting structure must be handled very carefully.

MOSALSK - TAX CAPITAL OF YUKOS

“The city of Mosalsk is the capital of the YUKOS empire. Located in the Kaluga region. Population - 5 thousand people. In all the years of Soviet and post-Soviet power, Mosalsk has not been supplied with gas; it is heated with wood. An ordinary Russian province: vegetable gardens behind fences, pigs and sheep on the streets and the beauty of nature in the form of a forest two blocks away. Here, at Lenin, 42, most of the industry of the MENATEP group is registered, including the oil monster Rosprom and the YUKSI holding, which interrupted its existence before the New Year. In total, there are more than twenty super-profitable enterprises on the list. They all pay taxes to the Mosal treasury. I found at Lenin, 42, a vacant lot with one boarded-up and two collapsing houses without windows and doors, as well as a chimney adjacent to them - a former vegetable drying plant in the style of Korolenko’s “Children of the Dungeon.” In the same vacant lot there was coal dust and several stalls that formed the Mosal market. As it turned out, taxes from industrial giants have little effect on the state of the Mosalsky district. This is an ordinary agricultural province where people do not receive salaries for a year. They live on the garden and the gifts of the forest.

I left Mosalsk with mixed feelings. I didn’t see here what I was coming for - I didn’t see any bronze lanterns, or roads paved with marble... But the trip was instructive. Mosalsk is a fully realized model of our country, reader. Like the city of Shchedrin's Foolov or Marquez's Macondou. In short, what a country is like, so is its business, and what kind of business is like its capital.”

Bulat Stolyarov, from the article “Wizards of the Emerald City”,
"Ogonyok", 07/20/1998

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