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En Vladimir Kuznetsov, co-founder of Beshtau Group of Companies, answered questions for the Kavkaz TODAY information and analytical portal
The news about the company “Beshtau Electronics” in recent days seized the top positions of information resources: the company, which has production facilities in Rostov and Essentuki, released the first batch (10 thousand pieces) of monitors M24FHD brand “Beshtau”.
And this is not some assembly of a foreign product, but our own, Russian, domestic, based on our own high technologies. A conversation about this with Vladimir Kuznetsov, a Russian entrepreneur, co-founder and head of the Beshtau brand computer hardware company.
– Vladimir, who are you at Beshtau Electronics?
– One of the owners. We have a family business: three families – three founders in equal shares. I can also be called the Development Director of the Beshtau Group of Companies.
– How many people do you have working for you?
– Today we are in the initial growth stage. The first batch of products has been produced, and we plan to expand. Just today I was at the signing of a land lease agreement for the development of our production facilities. The number of employees we have now at the Rostov plant (80 people) and at the plant in Essentuki (40 people) is not indicative. In some time, when we complete a couple of shops and bring in additional equipment, the number of employees will be multiplied. Filling of one plant, depending on the localization of processes – from 80 to 120 people. At the moment we have seven such plants planned, taking into account the already built one. We can already talk about 700-900 jobs. The situation can be adjusted. Of course, in the direction of increase.
– Is there any understanding, any movement towards it from the local authorities? How interested is the city itself in such production?
– This interest is obvious, we are among the priority investment projects at all levels of government – both municipal, regional and federal: full support with land and some processes of legal approval at the local level, total support from the governors of both Stavropol and Rostov region. And at the federal level they know about us and provide all kinds of assistance.
As for financial assistance, we do not resort to it. We do not use subsidies, special programs or other targeted money. There is such a vision of the process that it should be carried out at the expense of our own funds. And now, thank God, we have reached such a stage that we can develop with the help of the company’s revenue. The first shipments of goods have already started to be shipped.
– Is there a demand?
– Absolutely. We are talking about a domestic product. And all of Beshtau’s products, which will enter the market, will be included in the register of the Ministry of Industry and Trade. What does this mean? Now there is such a situation that within the framework of the import substitution program all budgetary organizations are obliged to buy exclusively Russian equipment. Its “Russianness” is confirmed by the register of the Ministry of Industry and Trade. Accordingly, the purchase of non-registered equipment – imported or Russian, which does not have a certain level of localization – will diverge from the requirements of the Ministry. And these requirements will become more complicated over time in order to encourage the development of own production.
– Do your products meet these requirements?
– Absolutely. And even ahead of schedule. That is why our products are allowed to be supplied to government agencies. Accordingly, the demand is great: we have many government agencies that need new equipment. And the production capacities that we have in Russia at the moment cannot meet this demand in full yet. Therefore, we can say that all our products will be sold, and in a short period of time. Our goal now is to develop as quickly as possible, to put new production facilities into operation. This is, in fact, a strategic task, in accordance with which we, in the first years of our development, do not prioritize the retail segment. The retail consumer can nowadays buy any kind of equipment without any restrictions – through retailers, through chain stores and so on, there is no problem here. But the state has a difficult situation here, and we are directing all our efforts to meeting its needs.
– The strategic objective is to develop your own, your own?
– Of course. Our products are characterized by the fact that we try to localize all possible processes of their production in Russia. In our monitor, yes, the matrix is purchased, Asian. But in fact, there are only three large factories in the world that produce matrices on an industrial scale. And most of the famous brands we use do not have their own matrices. In fact, the matrix does not carry any “criticality” – it is just a display element, you can buy it safely. But, for example, the monitor control board is already electronics. And this is our own development. Moreover, we buy and complete the BOM-list (list of materials required for production) ourselves. But we do the assembly on our own equipment. Motherboards, SSD disks, and power supplies are also of our own design. We are able to select, choose, and defect these components ourselves. If some manufacturer suddenly refuses to sell them to us, or some component has left the market, our engineers are able to quickly find another manufacturer. If some board has left the market altogether, we can make fundamental changes in the circuit of our boards. That is, there is no technological dependence on foreign partners. We determine our own production policy and are able to choose the necessary components for our products.
This guarantees the continuity of production. Until recently, there was a practice where Russian manufacturers ordered a foreign partner to develop a board – the latter took something that already existed, made some small changes to it, and sold the documentation to Russia. After that he started to deliver ready-made BOM-sheets, and the finished product was produced. But if suddenly such a partner either forgot to put something in the kit, or mixed it up, or deliberately refused to cooperate – that’s it! The Russian manufacturer will not be able to do anything himself: the documentation is purchased, there is no understanding of the components….
– There is a lack of technological sovereignty.
– That’s right. There are production facilities, they can assemble them, but only on orders. But we have fundamentally changed this situation. And when we talk about sovereignty, this is the minimum level of localization that ensures a certain independence. Of course, we would like to produce our own components and matrices. But I think it is only a matter of time and money. And now we are doing what is critically important to do at the moment.
Again: we can go into some detail, start producing some of these components… But we are trying to do things differently now: we have already reached a good level of localization and are striving to expand our product line as much as possible. In addition to monitors, the government needs input devices. We were the first in Russia to make domestic boards for mice and keyboards. All these electronics are produced in Rostov, and the enclosure is made in Essentuki. Here we have an injection molding shop producing enclosures for monitors, computers, keyboards, mice, as well as covers, keys, and other things….
– Where’s the raw material from?
– We are now trying different variants of raw materials. There are Chinese and domestic solutions – we look at the quality and price. But in time we plan to switch completely to domestic ABS plastic.
– What quantitative output milestones can you reach in the medium term?
– I can even talk about the end of this year. At the moment, we are a little tight on production capacity, but now we have already been allocated a site in Essentuki, and soon we will receive a similar site in Rostov, on which we will start construction. Some capacities will be commissioned in the middle of the year. If everything goes according to plan, by the end of the year we will be able to provide the following production volume: 350 thousand monitors of different lines, 150 thousand of our own monoblocks (we have already developed and are ready to launch them) and 100 thousand laptops.
We only have 24-inch monitors for now, but literally within 2-3 months 27-inch monitors will be launched.
It is fundamentally important to strive for universalism. The board we have developed even for the current monitor, besides providing a certain sovereignty, is a rather unique development that allows you to carry all kinds of connectors that are possible on monitors, more than 100 variations. There are there and speakers, and USB-hub, and the function of the so-called splitter – in order to the image that came from the computer to the monitor, to output further. This is very convenient, for example, for teachers in classrooms – to output the image to other devices. Up to 150 devices can be connected in series. This function, if I am not mistaken, was on the most expensive HP monitor lines.
– If I understand you correctly, there is a desire not just to replace imported products, but to make them even more advanced?
– Absolutely. We strive to enjoy our work, so the element of novelty, which ensures progress, is important to us. Moreover, a number of engineering solutions by another co-founder of the company, Oleg Osipov from Rostov, are being implemented for the Chinese domestic market. Our engineers have developments that foreign partners were surprised by even before all these sanctions stories. We are not parodying or copying anyone. We have our own solutions. And most of the components for our future monoblocks and laptops are also entirely our own developments.
Now we have set a certain bar for ourselves in terms of our capabilities, and we are confidently holding it. Once we have established the production of a wide range of products (monitors, monoblocks, notebooks, server equipment) and if the issues of international patent law are resolved, we will also produce printing equipment.
– I wish you success! You’re a local, aren’t you?
– Yes, from Pyatigorsk. The Beshtau brand was my idea, to glorify my native region and its beauty. Because I am a patriot of my small homeland. I like to climb Beshtau, both on foot and by bicycle. There is a trend nowadays to give technology the names of natural objects: processors “Baikal” and “Elbrus”, monitors “Valdai”. I think it is a good decision to name our brand this way. This will, among other things, contribute to the popularization of the region. And plus our slogan: “Beshtau – the way to the top” (in English, “To the top”). It reflects both the name of the brand and its essence.
Author Oleg Ponomarev
