The Textile-Contact trading and production group of companies (TC-Group) plans to achieve a gross turnover in 2024 at approximately the level of 2023, but a slight decrease in this figure is possible, said the group’s owner, Alexander Sokolovsky.
“I don’t think there will be any growth, I don’t see any big jumps yet. But our production capacities are fully utilized, just like last year and in 2022,” he said at the Forbes Ukraine Business Breakfast on Wednesday.
Sokolovsky did not name the gross turnover figure for 2023, but noted that it is easy to calculate based on the fact that the UAH 443 million in taxes paid in 2023 is 14% of gross turnover (i.e., a turnover of about UAH 3.2 billion – IF-U).
At the same time, he reminded that in 2022 the group paid about UAH 285 million in taxes, which means that in 2023 this amount increased by 55%.
According to the owner of TK Group, the peak demand for light industry products was in 2022, when, after Russia’s full-scale invasion of Ukraine and the initial “chaos,” a lot of orders appeared, in particular from Europe, which wanted to support Ukraine.
“Even if it was possible to buy more conveniently and cheaper, they ordered from Ukraine. Unfortunately, this trend disappeared later, and many European customers are no longer interested in our offers because they are afraid to place orders in Ukraine, especially near the front line or near the border with Russia,” Sokolovsky explained.
According to him, the group’s main strategy, which allows it to compete in international markets, is to develop production in Ukraine rather than move it abroad.
“When many people were moving production to China or Southeast Asia, we, on the contrary, were developing here, even though we were told that it was wrong. But over the past five years, the number of our factories has grown from seven to 12, in particular, last year we added the production of bags, this year – shoes, and we are expanding the production of clothing,” Sokolovsky said.
At the same time, he said that a partner from Poland may appear in the shoe production project at the Chyhyryn factory, but he has not yet announced any details.
Answering the question about the share of exports in total turnover, he suggested that over the past two years it has increased to about 15%, but mostly these are the products of TK-Home Textile, which participates in tenders of international organizations, in particular in Germany, Poland, and the UK, competing with companies from Turkey, China, and other countries.
“But we are planning to enter Europe, and while we are developing a production base in Ukraine, we offer finished products to Europeans. Our first representative office in the EU, in Lithuania, is still developing a client base – we have not yet achieved much there because there are many bureaucratic procedures in Europe, but we plan to come up with a proposal to develop social clothing and sew it in Ukraine,” Sokolovsky said.
At the same time, the owner of the group said that the biggest problem for the group is human resources (the majority of employees are women).
“We see that no matter what conditions you create and what salaries you promise, many women leave because they are uncomfortable in terms of blackouts, safety, many are nervous and leave because they are scared,” Sokolovsky said.
Speaking about the group’s plans for the heating season, he said that the companies mostly use generators, and the group does not have the funds to purchase, for example, gas-piston stations.
“To buy such a station, you need about EUR 850 thousand. We don’t have that kind of money, so we are currently using generators,” said the owner of the group of companies.
