Doing business in Russia isn’t harder than at home
He came to Moscow in the early 2000s to be in the computer business, but his love for food and the desire to introduce people in Moscow to Italian cuisine and food culture helped him establish a successful business with a lot of potential in the capital. One of the most famous Italians in Moscow, Giulio Zompi is a restaurateur, chef, enogastronomy expert, owner of La Scarpetta (the best Italian restaurant according to GQ, Time Out magazine, and other ratings), Don Giulio Salumeria, and Don Giulio Pasticceria cafe and pastry shop. He also makes Italian meat delicacies (everything from pâtés to prosciutto) under the brand name “Italian in Russia.” In an interview with Capital Ideas correspondent Anna Sirotina, he talked about his experience as an Italian who opened his own business in Moscow, made it through a trade embargo, and launched new projects every year.
Giulio, how would you introduce yourself to your readers? Tell us a bit about yourself
I was born in Verona. My mother was a teacher, and my father was a high-ranking military officer, so we were always travelling all over Italy. I finished middle and high school in Rome, and that’s also where I went to university. I worked in the computer business during and after my student years. In 1989, I just ended up in the right place at the right time and started my own company. Of course these were the golden years, and everybody who wanted to be in the computer business did well. You could make a lot of money without losing too much time. I traveled a lot and started other companies in this industry as well.
But I didn’t like being in the computer business – my passion was always to be in food and beverage, and everything related to it. It all started during my childhood. When I was little, my mom took me with her to the market and taught me how to pay attention to detail, how to select the right products. Then, my dad took me to some food manufacturing plants to show me how these enterprises operate.
I came to Russia to continue working on my computer business here, but the industry had become less profitable, so I decided to focus on what I’ve always loved. I understood that it was time to start doing what I like, so I started working in wine and food trade.
What was your first brainchild in Russia?
I started by representing wine producers in Russia which is something I still do now. Then, after holding many independent fairs, I opened my own store. Overall, Italian products sold very well, and back then I was one of the only people on this market. So in 2011, I decided to open Don Giulio – my own wine club with a tasting hall and a small wholesale store. But to really understand Italian culture, you have to try Italian delicacies with the wine. This is how I had the idea to open my own shop with products, a salumeria, and a restaurant. Afterward, I also opened a pastry shop with baked goods and desserts. I really wanted to share Italian cuisine and food culture with people in Moscow.
How did your business survive the food embargo in 2014?
Of course the crisis was very tough on us when the embargo was introduced. August of 2014 was one terrifying nightmare. I took six months to think about what to do next. I had planned to open a restaurant in 2014, and we opened in spite of everything in December. The profit margins were slightly higher than with the stores, and I managed to make it through.
Where did you find substitutes for Italian products?
My best friend in Russia helped me – Pietro Mazza, the owner of a farm in Tver Oblast that makes cheese and meat delicacies with Italian recipes. He was the first to start making quality Russian mozzarella and aged cheese. Before the embargo, his were the only Russian products in my store, the rest were all Italian. This was the first step we took toward import substitution, because other manufacturers didn’t exist back then. People, especially Italians, started to think about localizing production in Russia only after the ban on Italian imports went into effect and great conditions for local production emerged.
I took the next step two years ago. Back then, a lot of my compatriots started making cheese, but not many were making cured meats. I thought about having my own plant. As of today, my company, which makes cured meats and Italian delicacies under the brand “Italian in Russia,” employs about 16 people. We make cured meats that Italians can’t tell apart from the ones back home.
In your opinion, is cured meat production growing in Russia, or is it a fairly open niche in Moscow?
It’s growing at a slower pace than cheese manufacturing. I have put them on a sort of parallel development plan. But cheese production is growing faster, because there is a chance to make the product quickly – mozzarella, for example, or other kinds of cheese than you can make today and sell tomorrow.
With cured meats, you have to wait 30-45 days. And this is a completely different investment. And most importantly, all of this is possible thanks to the wonderful Russian process engineer Alexander Bondaruk. I am more involved in developing the right taste.
Of course, cheese manufacturing in Russia is growing quickly right now. What do you think of this market?
I observe changes in cheese production quality every six months. Of course, I’m talking about smaller cheese manufacturers. They get the best results. In Russia, cheese makers who put a lot of heart into their business do really well. This is the key ingredient in all products that we serve at the table.
Do you think it’s difficult for a foreigner to do business in Russia? What are the pros and cons?
I’m an optimist by nature, so I’ll start with the pros. The market is very receptive to quality products. The con – a foreigner might not know the rules. I’m talking about individual entrepreneurship. Of course, I wouldn’t advise anybody to just pack a bag and come to Russia to get rich. There are a lot of Italians in Russia right now. The important thing is what you do and how much work you put in, not the kind of passport you have.
Overall, doing business in Russia isn’t any harder than doing business at home, it’s just that the rules are different. But you can follow them here and there. You can adapt. People are always important, everything comes down to relationships between people and mutual understanding. If you’ve decided to do business in Russia, it’s important to be ready to deal with a lot of rules.
Do you prefer to work with your compatriots or are your employees Russian for the most part?
Of course I’ve invited some Italians to work with me, but a lot of my compatriots are lazy. They think that they can come here with an Italian passport and make more money than Russians, I tell to this guys that they are “Unuseful Italians”. In reality, it’s a lot more difficult to hire an Italian: there are visa problems, language barriers. It’s more difficult because Russians are sometimes really motivated to get things done, while many Italians feel quite comfortable once they come to Russia.
Times have changed. You started your business during a different era. Could you give some practical advice to foreigners who want to open their own business here now?
I think that if a person isn’t doing anything in Italy, then falls in love with a Russian woman and comes here, let him come. But those who want to do nothing and make money doing nothing have no business coming here. This is a country where you have to produce results. This usually means working 13-15 hour days. And those who want to work? Guys, come over! You’ll do well if you’re willing to learn about this country’s culture. You have to be a little bit insane to open a store in Russia. It would be a mistake to think that Russia is Klondike. You need a precise business plan. But the key to success is integration into society, understanding the way people think and their culture.
Do you consider yourself to be a successful entrepreneur?
I always have a critical attitude toward my products and my success. I’ll say this – I’m not happy with everything yet.
Can you say that your business is profitable?
Yes. I try to keep growing my business constantly. But I’ve had different periods in life. Right now, I can definitely say that since I launched my cured meat production business a year ago, I’m in the center of the storm. It’s a startup and a major financial stressor. So there is still a lot to do and it’s not a smooth period. But I am very excited about it, and very focused.
How do you feel right now? How long do you plan to stay in Moscow?
I feel like an Italian who loves Russian culture and loves Russia. It’s difficult to comprehend Russia with your mind, but it’s easy to love it. I’ve always been a fairly open person. Of course, I would have never come to work and live here if I didn’t like it. I like the cold, but not to this extent. And I can say honestly that I’ve grown to value warm Italy more after living in Russia.
Do you plan to return home?
I don’t have plans to come back now. I go to Italy for visits, like a tourist.
Do you have a motto that you live by, or some kind of personal philosophy?
To love and to be loved. I think that you can’t make food product without love either.
What’s your favorite place in Moscow?
When I have time, I really like to walk around the city center. I like Gorky park, for example.