The PPE market in Azerbaijan shows steady growth

Getsiz.ru is read not only in Russia, but also in the CIS countries. Within two weeks, we will make our readers familiar with the situation on the PPE markets in Azerbaijan, Armenia, Belarus, Georgia, Kazakhstan, Uzbekistan, and Ukraine. We collected opinions of the participants in the branch and manufacturers of PPE about the market situation, challenges, achievements and new projects.

Rasim Hamidov, Vostok Protection LLC, Managing Director.

Market situation in Azerbaijan in 2018 can be characterized as stable with an upward economic trend. Last year showed an economic growth by 2%. The projected economic growth in 2019 is set at 3.6%. In general, the country is positively affected by the reforms aimed at economic diversification and focusing on the development of non-primary sectors.

2018 saw some changes in the country’s fiscal policy, which can be described as fairly liberal:

VAT for self-employed entrepreneurs was brought down to 2%;
14% income tax on wages has been eliminated, provided that the monthly wage does not exceed $ 5 thousand;
The following measures were introduced to encourage cashless payments:
- buyers are entitled to a cash-back in the amount of 15% VAT allowance on any purchased goods;
- salesmen are entitled to a 25% discount on corporate income tax on sales made through POS-terminals.
VAT rate has been fixed at 18% and corporate income tax at 20%.

All this allows us to bring a considerable part of the economy from the shadows.

Changes have also occurred in the customs sector. Their main purpose is to facilitate customs clearance procedures. With the introduction of electronic declarations customs clearance can be carried out while the goods are on the way and thus reduce the time of delivery and receipt of goods from the supplier to warehouse.

According to our estimates the volume of the PPE market in Azerbaijan is $ 60 million. Naturally, the lion’s share of this market is related to the oil and gas industry. The confirmation of this statement is the extension of the «Contract of the Century» between Azerbaijan and BP Company till 2050. This will bring the country tens of billions of dollars.

At the same time, other sectors are also developing e.g. agriculture, metalworking manufacturing, automotive industry and tourism. Since there is a general growth in the country, the PPE market, which is directly related to industry, is not lagging behind either. The PPE market, according to our estimates, has grown by 10-12%. Our company is growing even faster. This is the result of the systematic work with clients. In 2018 Vostok Protection opened a new retail store in Baku, now there are three of them. We were the first on the PPE market in Azerbaijan to post our prices on the web site and started online sales. Last year’s plans were fulfilled. In 2019 further territorial expansion is planned (opening a store in the town of Ganja). We are also planning to introduce new related products to expand the customer portfolio.

Elvin Bairamov, «Vostok-Service-Baku», Managing Director.

According to official data there are 5.5 million working-age people in Azerbaijan today. At least 1.5-2.5 million people need workwear, safety footwear and PPE. There is a market for PPE in Azerbaijan, but it is still poorly developed. The market is open: with regard to PPE both EN norms and Technical Regulations of the Customs Union 019/2011 are valid.

A good trend is the increasing attention to occupational safety and combating counterfeit and fake PPE by the government. Another trend is that the largest companies are strengthening the requirements for safety and compliance of PPE to the Russian and European norms.

In the past year or two, companies started buying high-quality premium workwear. For example, we noticed that our flagship collection «Uran», which appeared on the market last year, quickly became popular and is now in great demand despite its high price by the Azerbaijani standards. Azerbaijani companies are now open to everything new: digital technologies in occupational safety, modern services and so on. Innovations seem to be in great demand.

Vitaly Rumiantsev, LLC «Ansell Rus», Head of the «Protective apparel and rescue equipment» division.

I love to be in Azerbaijan. Baku is one of the most beautiful capitals of the former USSR republics, and the leaders of Azerbaijan have invested huge funds in enhancing attractiveness of this city for tourism, international sports and cultural events like Eurovision, the European Games and Formula One, while clearly recognizing that public security is a key factor for the development of common infrastructure.

A good deal of protective equipment and rescue means used by the EMERCOM of Azerbaijan has been upgraded. More advanced insulating suits and degassing / decontamination equipment are used today. Baku is a city with densely built-up historical districts. Therefore, to rescue people from buildings on fire, EMERCOM of Azerbaijan acquired the most up-to-date pneumatic rescue devices, otherwise called landing airbags. These are rapidly deployable inflatable devices that allow people to be quickly evacuated in the event of fire. I sincerely hope that they will not be used for the intended purpose.

Of course, in addition to the uniformed agencies, the PPE market in Azerbaijan is of great interest due to the dynamically developing oil and gas industry, food industry that actively implements the HACCP principles and agriculture (the wine industry of this country is one of the strongest in the post-Soviet area).

But I would especially like to note that Azerbaijan’s employers now are not regulated by outdated issuance norms and conflicting standards. They are free to choose what to buy for their employees, whether these PPE were approved in Russia, EU or the United States. Most importantly, PPE must provide the necessary and proven level of protection, be safe for the user and cost effective for the employer.

Vostok Protection Company has been operating in the Azerbaijani market since 2014. The company’s turnover is $ 3.2 million. Vostok Protection is a dealer of leading Russian and international PPE manufacturers: «Zelinsky Group» GC, «Firm «Technoavia» PV LLC, «Spetsobiedinenie» GC, «SOMZ» JSC, JSP, Ansell, 3M, Univet, Ringer Gloves, Exena, DuPont, Canis Safety, Nitras Safety, Sacla and Portwest.

Vostok-Service-Baku CJSC was founded in 2006. The office is located in Baku. Vostok-Service-Baku is a winner of Navigator Business Award-2018 in the nomination «Company of the Year: Sales of Workwear». The company is a member of Vostok-Service Group.

The 23rd international specialized exhibition «Occupational Safety and Health – 2019» (BiOT) will be held on December 10-13 in Moscow, pavilion No. 75 of the Exhibition of Economic Achievements. The exhibition is organized by the Russian Ministry of Labor and the Association of Developers, Manufacturers and Suppliers of Personal Protective Equipment (ASIZ). In 2018, the area of BiOT Fair was 13 thousand square meters. The number of visitors was 15 thousand.