Let me tell you a story...
Oleg Khusaenov does not believe in luck. When the Soviet Union collapsed in 1991, a once-in-a-lifetime opportunity opened up to do business in a part of the world where private enterprise had been a dirty word for 70 years.
But Khusaenov, who grew his car dealing business into a multimillion-dollar empire in the years that followed, insists that only those who were well prepared thrived. “Luck counts for nothing,” the 45-year-old businessman says with a smile. “Only those who were ready for this happiness — the end of the USSR — got lucky.”
Khusaenov, founder and CEO of Atlant-M, an international holding company that sells and services cars and vans in Russia, Ukraine and Belarus, was well prepared. After training in engineering, he started his own business in 1988, three years before the USSR crumbled. Based in Minsk, the capital of Belarus, he was working in a fridge factory at the time.
Sensing that change was afoot, he and a group of friends set up a small business on the side washing factory windows. “In the evenings and at weekends, we washed half the windows in Minsk,” he recalls.
In 1990, Khusaenov and his friends left the factory and got into the brokerage business. He remembers having to sell a new Japanese TV and video recorder that his parents had bought for him overseas. Both items were highly sought-after luxuries back then, but he decided it was better to sell them to help raise seed capital.
Initially, the friends traded in timber, oil and paper. Problems briefly arose in the dying days of the USSR when the Communist Party was banned. Khusaenov had set up his business in cooperation with the youth wing of the party and had to scramble to convince the authorities that there was nothing communist about his business.
He succeeded and, in 1992, the friends entered the car business, taking advantage of huge price discrepancies in the region. They bought trucks cheaply in Belarus and drove them to Moscow, where they sold them for twice the price. They did the same with Lada cars, but in the reverse direction.
Later, the company began to take advantage of a legal loophole that allowed it to buy and sell Ladas without VAT by driving them across the Russian border and back again. It was a lucrative ploy.
But in 1994, Khusaenov realized that he needed a more stable business model. Atlant-M therefore bid for, and later won, a tender by Volkswagen to sell and service its cars in the former Soviet Union.
"In the evenings and at weekends, we washed half the factory windows in Minsk"
Khusaenov, who stopped selling Ladas soon afterwards, says he has never looked back. “Thanks to Volkswagen, we became an international company,” he says. In the years that followed, Atlant-M expanded rapidly, opening 34 dealerships in Russia, Belarus and Ukraine that sold 19 different international brands, from Volkswagen to Saab.
He says he was well served by several rules that he made for himself and his associates. Rule one was to invest any spare cash in the business rather than lavishing it on himself. He says he only bought his first home, just outside Minsk, in 2000. Rule two was not to hire any top managers’ wives (a fairly common practice in the former Soviet Union) so as to avoid tensions, and rule three was to keep fastidious accounts.
Khusaenov steadily built up the company, recruiting those he thought were the brightest and the best from top universities and vocational institutes. “My strength is that I can attract people who are more talented than I am and convince them that they will earn more money with me than without me,” he says.
Khusaenov avoids politics, depite living in a part of the world where it is sometimes intricately intertwined with business. “Good companies work with whoever is in power,” he says. “It’s dangerous to get involved in politics. If the employees are getting good money, that is what you can do for society.”
Enter the downturn
At the end of 2008, Khusaenov was thrust into the role of crisis manager. The financial downturn hit Atlant-M hard, forcing it to slash and restructure its debts, and to cut costs and its workforce by a fifth. Five loss-making dealerships were shut down and two others were sold off. Facing a US$60m margin call from creditors almost overnight, the company held a sale of all its warehouse stock and made the payments.
“We started to lay off people, but very carefully,” Khusaenov recalls. “You cannot lay off mechanics because they are like doctors: it is difficult to find good ones quickly.”
The strategy paid off. Khusaenov says that a steady recovery is now under way in Russia’s automotive market and that Atlant-M is well positioned to take advantage of this. He is bullish about all three markets in which the company operates. However, he says it is too early to talk of expansion.
Satisfied that Atlant-M has successfully weathered the crisis, Khusaenov is looking forward to taking on a new challenge. On 1 January, he handed over his day-to-day duties as CEO to a colleague whom he says is more gifted when it comes to customer relations and marketing. Such skills will be in great demand during the next stage of Atlant-M’s development, believes Khusaenov, who plans to focus on developing what he sees as irresistible investment opportunities in Belarus.
“Belarus is like Africa,” he grins. “When you’re selling shoes in a market where half the people don’t have shoes, you have a good chance.” Asked what advice he would give any would-be entrepreneur, he doesn’t hesitate: “Study, study and study.”