Analysis

Poland’s global champions

From fashion to passenger vehicles, an ever-increasing number of Polish companies set up in the 1990s are prospering beyond their home market. We take a look at what's making them so successful.

One of the most famous quotes the American poet Thomas Stearns Eliot left us is about risk being the anteroom of success. “Only those who will risk going too far can possibly find out how far it is possible to go,” he wrote in the preface to Transit of Venus: Poems by Harry Crosby.

For those Polish firms who dared to start a business in the 1990s, when the country’s transition to a market economy had barely begun and the economy was in a precarious state, daring was exactly what was needed. And yet it is those same companies, often founded as family businesses, which are now leading the Polish charge towards new markets.

Solaris

“There is no single recipe to become a global champion. In my opinion the most important factors to making a company successful are very good leadership and a very good team, discipline and consistency in how you do things, understanding of your market and changes to it – then coming up with the appropriate responses to these changes, a bit of luck and of course a lot of hard work,” says Dariusz Michalak, deputy CEO of Solaris Bus and Coach.

Solaris started as a family business in the 1990s, founded by Solange and Krzysztof Olszewski. Now, 22 years later, the company has grown from a few dozen to over 2,300 employees. Last year was a record year, when not only did Solaris win the coveted prize of best bus of the year, but 70 per cent of the company’s sales went to international markets. Solaris also an absolute record in sales, selling 1,397 vehicles, beating the previous best by 17 vehicles, set back in 2014.

“The experience of Solaris shows that having subsidiaries abroad may increase the chance for success on foreign markets. It is very useful, from a business point of view, to have insiders or local professionals who know and understand the characteristic features of a given country. What’s more, in some areas there are often legal regulations that require your presence in another state. This also allows you to be closer to your clients. But most importantly success would be impossible if we failed to meet our customers’ expectations which are of utmost importance to us,” Mrs Olszewski told Emerging Europe.

Inglot

Cosmetics producer Inglot is another well-known Polish brand, now present in every continent, from Australia to the US. There are more than 100 Inglot stores in the United Arab Emirates alone.

“One of our most important stores is in New York, at the corner of Broadway and 48th Street,” says Zbigniew Inglot, co-owner and chairman of the board of Inglot Cosmetics.

“We also in New York have a beautiful Inglot Pro Studio in Chelsea market. This is where a lot of make-up artists, celebrities and sportspeople come to try our products and cosmetics,” he adds.

The company was founded by his brother Wojciech Inglot: a chemist, a cosmetics maker and a visionary.

“Chemistry was a passion for him. He started working while he was still a student. He worked for several companies, not only just those located in Poland, to create some recipes for them. Then, after he graduated from university, he started to work at Polfa, which was one of the largest pharmaceutical companies in Poland. He worked very hard, and his favourite place was his laboratory,” Zbigniew Inglot tells Emerging Europe.

When more and more retailers started to enter the Polish market in the late 1990s, Mr Inglot decided it was time to create his own chain of stores.

“Owners today shouldn’t start to spend money at the very beginning; they shouldn’t start with posh cars. They should spend money on investigating markets, not only in Europe.”

Inglot’s flagship store on Times Square, New York

Following the giants

“Companies such as Inglot, LPP and Solaris are large, dynamically operating entities that perform well in international markets. We are proud of their success and we try to support their efforts,” says Tadeusz Kościński, Polish under-secretary of state.

“Nevertheless, it is clear that the contribution to export depends on size of enterprise. In the case of SMEs they may employ about 70 per cent of the work force and their share in Poland’s GDP may be over 50 per cent, but at the same time their level of internationalisation only reaches 21 per cent. On the other hand, larger companies already export around 60 per cent of their production. That’s why our activities related to export support are currently focused mostly on SMEs,” he tells Emerging Europe.

PAIH Expo, a trade and investment forum which took place in Warsaw in October, was mainly about increasing exports and getting Polish companies to increase or begin operations abroad.

“Usually when you try to identify the companies willing to expand globally, you think about  the large corporations. Apart from their sheer size, this is also about their profitability, role in the industry, presence on the global markets and R&D investments. At the same time, let’s not forget about smaller companies following the giants. There are also hidden champions that have found a niche and become known under other brand names,” the the Undersecretary adds.

He mentioned Pietrucha Group in the civil engineering sector, whose exports account for more than half of its activity, with its products already present in 34 countries on five continents. Or Adamed, operating in the pharmaceutical sector, which carried out the largest Polish investment in Vietnam last year. And the space sector star, Astroniki, which equipped an unmanned NASA lander with a measuring device. Ceramika Paradyz, a maker of ceramic products and ready-made arrangements, has spectacularly increased its share in the North American market. Cruz Group, a superfoods producer, managed to successfully enter 30 countries in just three years.

Another Polish company doing great things abroad is CD Projekt, a video game publisher and distributor founded in 1994, now leading the gaming industry thanks to its best-selling game fantasy game The Witcher.

The Polish marine engineering company Inter Marine Group is also worth mentioning. The brand was established in 1990 and in early 2018 set up its own production facility in Portland on the English Channel.

“Having our own production facility opens new opportunities for development in the UK. Now we are looking beyond the marine industry, focusing into the energy sector, the petrochemical sector, oil and gas and offshore,” says Sławomir Kalick, the president of Inter Marine Group.

When the 2008 global financial crisis hit Marine’s British clients, Kalick says there was only one thing to do.

“Instead of shutting down our operation in the UK, I decided to open my own company and take the future in my own hands and drive it myself,” he explains.

And that paid off.

“There are projects like the construction of two aircraft carriers for the Royal Navy that we have worked on for the last four years. After the success of the first ship, the second one was 100 per cent handled by our company, with a team of more than 500 people involved. Establishing the company in the UK, I would have never dreamt of building these aircraft carriers, which is a lifetime opportunity.”

A champion-friendly market

According to under-secretary Kościński, in 2017, goods with a value of around 206.647 billion euros were exported from Poland, creating a trade surplus of 563 million euros. These numbers would be even larger if we took into account trade-in services.

Poland’s main export destinations were Germany, which accounted for 27 per cent of all exports, the Czech Republic (six per cent), the UK (six per cent), France (six per cent) and Italy (five per cent).

In 2017 Poland’s main exports were mechanical and electrical machinery and equipment (24 per cent), vehicles and their parts and accessories (12 per cent), furniture (4.8 per cent), plastics (4.8 per cent), and iron and steel (3.2 per cent).

“It is interesting to note that if we take into account the annual export growth in the years 2013-2017, Poland ranked in fifth place among the 50 largest exporters in the world (after Vietnam, the Philippines, Ireland and the Czech Republic),” he comments.

“Fortunately, more and more businesses in Poland think about becoming a global player. We want to help them turn these aspirations into a specific business plan and manage the risk properly,” he continues.

And when we talk about risk do not forget about what American businessman Leonard C. Green wrote in his award-winning book The Entrepreneur’s Playbook: “Entrepreneurs are not risk-takers. They are calculated risk takers. The difference between risk-takers and calculated risk-takers is the difference between failure and success.”

Main photo: HMS Queen Elizabeth, a Royal Navy vessel built by Poland’s Inter Marine Group.

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