In an exclusive interview with IN Diplomacy, Ms. Nomita Dhar spoke with Mr. Amrish Rungta, Business Head, Finance & Operations – Russia, CIS, Ukraine & Kazakhstan at Food Empire, to discuss the company’s latest expansion into Kazakhstan. He shared insights on how as part of Food Empire’s broader strategy, this expansion aims to strengthen its presence in the region’s growing consumer markets while positioning Kazakhstan as a key hub for Central Asia.
Sun Media: What attracted Food Empire to invest in Kazakhstan, and what market opportunities do you see in the region?
Mr. Amrish: Food Empire first entered the Kazakhstani market in the early 1990s. Today, we are proud that our MacCoffee brand holds market leadership position with over 70% share of the instant coffee market because of our success in pioneering coffee culture in a traditionally tea-drinking region. Kazakhstan has a high proportion of middle-income earners and is one of the fastest-growing economies in Central Asia, offering strong market potential. We believe Central Asia offers significant potential for expanding the coffee culture, as more consumers adopt instant coffee and premium instant beverage options for convenience amidst increasingly busy lifestyles.
Sun Media: How would you rate the ease of doing business in Kazakhstan, and what were some of the key challenges you faced during the setup process?
Mr. Amrish: Having personally worked in Kazakhstan for many years, it is a business-friendly environment with government initiatives aimed at attracting foreign investment and fostering industrial development. Plus, with the set up of Special Economic Zones, such as “Khorgos – Eastern Gate” which provides valuable incentives, including tax benefits and streamlined customs processes. It has significantly enhanced the ease of doing business. That said, setting up a business in Kazakhstan is not without its challenges. We had to navigate regulatory requirements, align with local standards, coordinating with different government bodies, and establishing efficient supply chains as Kazakhstan is a landlocked country, so we will need to leverage on multi-modal transportation routes through neighboring countries to import and export Food Empire products.
Sun Media: What advice would you give to other businesses considering investing in Kazakhstan?
Mr. Amrish: Our advice is to do your homework, study and understand the market and make the effort to establish strong relationships with local stakeholders. Case in point, Kazakhstan has always been a tea-drinking country but in recent years, consumption of coffee has increased due to the influence of global F&B trends within younger consumers. By studying the market trends of the country, Food Empire was able to offer our products that appeal to the changing taste buds and capture a share of this expanding market.
Sun Media: What is your vision for the new factory in Kazakhstan, and how does it fit into Food Empire’s overall business strategy?
Mr. Amrish: This new facility will serve as a hub for the entire Central Asian region, including Kyrgyzstan, Uzbekistan, Turkmenistan and Tajikistan. Kazakhstan is part of our plan to deepen our roots in Asia due to the region’s relative economic stability and burgeoning consumer markets. We believe our new Asian focus will enable us to mitigate the geopolitical situation and currency volatility in our European markets. The Kazakhstan facility is also part of our broader strategy to capture a larger share of the growing consumer markets in Central Asia, where we already have a significant market presence.
Sun Media: What product lines will the new factory in Kazakhstan produce, and how will they cater to local and regional demand?
Mr. Amrish: This new production facility will allow us to launch a wider range of products beyond coffee mix to also include tea and other instant beverages. From this facility, we can supply the entire Central Asia rather than supplying it from our plants further afield, like Vietnam or Malaysia. It will enable us to supply our products with greater speed and at lower logistical costs to us.
Sun Media: How do you envision working with local Kazakhstani partners, suppliers, and stakeholders to ensure the success of the new factory?
Mr. Amrish: Although the production facility is new, Kazakhstan as a market is not new to us. We have been here since 1990s and we are familiar with how business is conducted here. With over more than 20 years in the market, we have also established long term relationships with various stakeholders here and we look forward to tapping on these relationships as well as establishing new ones to make our investment a success. We worked closely with Atameken (National Chamber of Entrepreneurs) and Kazakh Invest for regulatory guidance, incentives, and networking. We also collaborated with major retailers like Magnum, Small, and others to distribute our products.
Sun Media: How easy was it to obtain visas and hire local talent for the new factory, and what strategies did you employ to attract and retain skilled workers?
Mr. Amrish: With this new facility, we will be creating 300 jobs for locals. Our practice is to send a team from our existing production facilities to offer training for new hires. We also have an orientation programme that will inculcate our company culture and communicate our work ethos to all our staff. We have a robust human resource programme that ensures that our workforce is happy and the working environment is conducive and safe. We offer equal opportunities for all and we hire based on the skills required to fulfil the role. We offer career advancement opportunities to employees who show the potential to take on leadership positions so that they can look forward to a long term career with us. We are committed to ensuring continuity within our workforce and offer training courses to ensure that everyone is equipped with the skills to fulfil their tasks, and to do it well as they progress in their career with us. We also offer attractive remuneration and employee benefits as well as opportunities for both professional and personal growth. In many of our markets, Food Empire works closely with institutes of higher learning to offer internships that may potentially result in a permanent position for worthy candidates. This may be something that we will also offer in Kazakhstan. We believe our commitment to treating all employees fairly and generously has made us an employer of choice across all our markets.
Sun Media: What market opportunities and future growth prospects do you see in Kazakhstan and the broader Central Asian region?
Mr. Amrish: To capitalise on market opportunities, we plan to localise production, aiming to reduce reliance on exports from our plants further afield. This will improve efficiency and mitigate risks associated with long-distance logistics and cross-border trade. We will continue to drive localised promotions and sampling events that have strengthened brand awareness, product adoption and consumer loyalty in homes and offices.
Sun Media: How would you describe Kazakhstan as a destination for expats, and what support systems are in place for foreign workers?
Mr. Amrish: I would say it is an interesting destination for expats. It has a mixture of modern urban life in cities like Almaty and Astana, whilst set against the vast natural landscape. Plus, the growing economy, Kazakhstan is one country to watch. There are expat communities available. We encourage foreign workers to join business councils such as AmCham Kazakhstan, to help them connect and navigate life in Kazakhstan.
Sun Media: How does Food Empire plan to leverage its presence in Kazakhstan to meet the needs of the broader Central Asian market?
Mr. Amrish: Consumers in the region can look forward to the same great taste that they have come to expect of our product. In addition, we will continue with R&D to launch innovative instant beverage products that cater to local tastes and consumer preferences. Our primary goal is to offer products that not only meet evolving market demands but also provide unique and enjoyable experiences.
Sun Media: What would your advice be to other Singapore investors?
Mr. Amrish: Collaborate! Collaborate with local stakeholders and establish joint ventures with Kazakhstani companies. This will help your journey by leaps and bounds. Leverage Special Economic Zones (SEZs) and Industrial Parks, such as Khorgos – Eastern Gate, to benefit from tax incentives and enhanced logistics.
