September 14, 1994
Tuesday
After the anniversary binge — a year since we opened! — we held a brainstorming session. The leadership of the trading house — me, Kostik, and Yura — holed up in the office, sketching strategic little boxes connected by tactical little arrows.
The old way of working had resembled an anthill. Fifty-odd managers, each handling a bit of everything, impossible to manage. Where things went and how they got sold — anyone’s guess. How to motivate growth in sales — a mystery. Second point: Vadik assured us that at any hour of the day or night, he could provide an interest-free loan for any amount denoted in dollars — even a million — in non-cash rubles, at his exchange booth’s buy rate. One condition: repay the loan in a month, in cash, at the sell rate, at the same booth.
Gotta grab it!
The Proma free-for-all, where a division manager was responsible for the goods on the shelf and didn’t worry about anything else, was over! We set a new mandate: if the goods weren’t in the warehouse, buy them in Moscow on credit and sell them to the regions for cash. Bearing in mind Chicha’s crew, which had grown large enough to prowl not just the Moscow markets but the entire country, we allowed goods to be handed off on consignment, but at a slightly higher price. Paying the athletes’ travel expenses, putting them up in hotels, and bribing the local cops to keep them calm cost money and had to be factored into the cost structure.
Whew!
The regional division got rolling — first haltingly, then eagerly, and finally in a full-blown frenzy. Someone always needed to pay back a loan, someone needed to restock with new goods and offload the old, and someone needed to improve their numbers and boost their cash flow.
Everyone knew Proma would buy back any consumer goods at a 30-percent discount, paid with an accepted payment order. In the regions, it was the reverse — the moment a shortage appeared, they’d drive straight to Proma. Payment could be made a month later, in cash, the only payment method the regions trusted, having feared non-cash transactions like the devil fears holy water ever since the days of the Chechen avizo scheme.
The product lineup kept expanding with Chicha’s help: a tidal wave of goods seized from debtors came flooding in. Chicha had signed on as a debt collector for a dozen outside banks and kept trying to unload industrial equipment on us, which I resisted, until Zhora issued an order:
«The plant in Khryakino is sitting idle. It needs to come back to life. Whatever solid equipment Chicha hauls in on the production side, get it running and up and operating!»
I had to scramble to create a Technical Department on the fly, headed by Pasha, who’d quit six months earlier, tasted freedom, and come crawling back. He’d spent the whole summer shuttling to Poland: hauling irons and binoculars over, tracksuits back.
With the help of Khryakino’s old craftsmen, called back from a year’s furlough, Pasha installed and got running a bottling line, pried out of debtors by Chicha’s athletes. Proma Impex started producing «Proma-Cola,» the perfect companion to «Johnnyson» whiskey, the best-selling product we’d been trucking in from Poland for two years running.
By spring, four production lines were clattering away in Khryakino. In one shop they mixed up Proma-Cola; in another, they poured motor and transmission oil from tanker cars, gotten free of charge from Chicha, into canisters. He had nowhere else to put it: either dump it in the Yauza River or hand it over to us as a favor.
The plant had rail access and a siding for the tanker cars. Canisters were stamped out in the shop next door, where they’d installed an injection molding machine hauled from a Belarusian plant that had somehow ended up owing Vatrushka money. The Belarusian scrap metal was brought back to life in two weeks.
In the third shop, they set up label printing on a dead-and-resurrected Romayor press. The machine could manage single-color printing, which was enough to produce elegant black-and-green «Kastroil» labels. They printed in black ink on green paper. When the green paper ran short, they’d print on whatever they had — red, orange, yellow... Anything but white, since that made it look shoddy. The managers explained to buyers that a red label meant «sport,» yellow meant «trial,» pink meant «luxury,» and blue meant «winter standard.» Despite the fact that the canisters were all filled with the same mystery blend from the same two tanker cars, the auto-parts department suddenly boasted an impressively broad range of oils, one for every driving style and every twist of the weather.
