I interviewed Darya Koroleva who discussed Unique Points Concerning Russian Supply Chain.
It's good to speak with you today, Darya. Looking forward to hearing your views on the unique aspects of Russian supply chain. Before we start, can you provide a brief background of yourself?
Hello. My name is Darya. I'm a logistics specialist in an international company. We import some medical devices from all over the world, such as analyzers and spare parts and consumables for them. I have more than 10 years of experience in supply chain, and I hope I will be able to tell you something interesting about supply chain in Russia.
Thank you. Can you first talk about what are some of the main risks involved?
Actually, we have a lot of risks, which should be analyzed during preparation process for every shipment. But I would like to tell you only about two main groups. And the first one is geographic risks and the second one is legal risks.
As for geographic risks, this group can be subdivided into two parts. Some are import prohibitions or sanctions, which we can have for particular countries. For example, maybe you know that Russia can't import some spare parts from China. This import is limited. And we can't import now some vegetables and food from Turkey and Europe.
As for the second subgroup, it is geographic instability. I mean some military conflicts, which we can have outside Russia. In this case, the recent military conflict in Ukraine can serve as a good example. The situation made us...rework the whole supply chain, the whole route, which we use for our goods from Turkey to Russia, from Istanbul to Moscow. Before, we used tracks, and these tracks went through Ukraine. But during this conflict, it became impossible. And to avoid any problems, our forwarder opened a new office in Novorossiysk. And we started to use sea containers from Istanbul to Novorossiysk. And then we started to use tracks from Novorossiysk to Moscow. This change has allowed us not only to avoid any problems in the Ukraine, inside Ukraine, but also to save some money and some time.
As for the second group of risks, legal risks, I would like to emphasize some intellectual property problems, which you can have if you would like to import branded goods. If brand is registered in Russia, so you can't do it if you don't have a special document from the brand owner which allows you to do it. If you don't have it, your goods will be stopped, definitely will be stopped at customs, and your company will be punished.
This group can also be subdivided into two parts — intellectual property problems and also rapidly changing rules. A logistic specialist in Russia knows that our customs can change any rule without any preliminary notice. So we should monitor online resources every day and every hour in order to know about all possible changes, which we should analyze for our future shipment, for our tomorrow shipment, for example.
So I have named only two groups of risks, but even now, you can imagine how difficult is supply chain in Russia.
So how complex is the process of customs clearance? Is there more you could say about that?
Yes. Knowing about all the risks, I can say that customs clearance in Russia is a very complex process.
Firstly, we have a long list of characteristics, which should be provided during customs clearance. This list includes, for example, not only the country of origin but also the producer. My suppliers, for example, are always surprised when I ask them to provide me with information about the exact producer of each item because without this information, you cannot fill in the declaration, so your import is not possible.
Also price is very important, your contract price, I mean, because price is supervised by Russian customs also. Every logistic specialist should be ready to present all proving documents to prove your price. It can be a very long list of documents. You should remember about all of these aspects. Then you plan your shipments.
Can you talk about collaboration between partners? Is this important for getting good results?
Yes. I think collaboration between the stakeholders — I mean, suppliers, forwarders, and customers —here in Russia is extremely important because we should act together from the very beginning to the end of the whole process. For example, all our stakeholders should be informed in advance about all the necessary documents which can be needed, as I said before. This can be certificate of origin, some technical descriptions, chemical composition, price lists, export declaration. And if you do not have even one of these docs, your goods can be stopped. I think that this should be indicated in your contract because, only in this case, you're likely not to have such problems, and your supplier will be prepared, that his or her company should provide all these documents. So I think that collaboration is very important if you want to achieve the best result.
Well thank you for sharing today on Russian supply chain and all the issues involved.
About Darya Koroleva
Logistics Manager, Import \ Export, Customs clearance, Supply Chain, Business Analyst, Purchasing, Wholesales