Business point: The Bulgarian company ‘Biomashin’, which is a key supplier of the giants Nestle and Mondelez.
‘Business Point’ is the most recent series, introduced by Money.bg, which is aimed at putting the spotlight on the successful performance model of companies that have proven to have a major contribution to the Bulgarian economy. This time, we chose to present the Bulgarian family company ‘Biomashinostroene’ (Bio Mechanical Engineering).
Speaking of a company which started up with some 17 employees manufacturing products for none but the domestic market, then, three decades later, expanded by leaps and bounds into a global leader in that sector, exporting to distant markets, such as the USA, Japan and New Zealand, their clients ranging from Danone to Nestle. It makes more than a perfect story. ‘Biomashinostroene’ (or ‘Biomashin’ for short) has proven to be so far one of the largest-scale manufacturers in Plovdiv.
Established back in 1986 as a state-owned company, the firm set out as a manufacturer of biotech products. Some 30 years or so later, the company got private finding its hand in furnishing the right equipment for the F&B industry, pharmaceuticals and chemical industry where 90% of its output is for export.
Gergana Philipova, who has 18 years of experience in the company, tells Money.bg about the way she worked her way up to a leadership position in the sector, and shares her insight about the future development of Biomashin’s business.
About ‘Biomashinostroene’ (Bio Mechanical Engineering)
1986 – Biomashin was founded as a state-owned company, today it is a private business;
17 employees – the number of employees engaged in the company at the start;
250 employees – the number of employees in the company today;
23,5 million leva – this is the figure of the income generated for the previous year;
90% – the part of the company’s output that is exported;
Over 20 – the markets the company exports to.
Previously a state-owned company, today Biomashin exports 90% of its production
‘The company draws upon a 30-year history, it used to be an ownership of the state. It started up with some 17 employees, penetrating for the most part the Bulgarian market. It was meant for production of biotech equipment,’ she explained.
Since 1989 the company has been private and upon the EU integration of Bulgaria, the company has made a practical use of this and expanded the business.
‘Following the integration of Bulgaria in the EU, we discerned a nice opening to the single European market. We set or aim on high and went for it. At the very beginning, the orders placed were small, however, we welcomed them quite as a challenge. Our major competitive advantage proved to be the low-cost labor in Bulgaria,’ admitted Gergana Philipova.
Further down the way, Biomashin found itself exporting increasingly more products, and not only to the EU markets, rather, further to the Near East, North America and the East of Asia. At present, there are 250 employees on the company scheme in Plovdiv.
‘Biomashin’ turned from a public, honestly, a socialist company, dedicated entirely to the domestic market, into a private, medium-sized company, which proved to be a global leader in that industry. We are the best-equipped European-based company in that industry. I would dare to say so drawing upon the testimonials of our clients,’ admits Philipova.
‘Our major markets have happened to be the Near East, Central Asia, the EU, however, we have a whole array of projects which got implemented across the world, such as New Zealand, Japan, North America, etc. Our business is project-driven, with each project cutting a unique figure. Currently, we have 250 employees, 30 of which engineers, engaged in our structural team and R&D,’ she added.
What does Biomashin do exactly?
It is hard to imagine the real output of Biomashin, unless one sees it first-hand. In theory, we could say the company produces vessels, heat exchangers and further equipment for various Bulgarian and foreign companies in the F&B, cosmetics, chemical and pharmaceutical industry.
But on the practical perspective, there is raw material making its way into the company base in Plovdiv, which is processed into finished goods and later scheduled for shipment abroad. Speaking of which, these are for the most part facilities, impressive in size.
And to point out that the company is working on truly large-scale projects, Gergana Filipova gives an example:
‘Heat exchangers are one of the products where we have definitely been a leader for the recent years. Biomashin produces ca. 70 units per year, some of which are truly large-scale projects. To give an example, the evaporator heat exchanger which has been ordered by an Austrian client, is to be used for starch production. A single piece of the of equipment has a length of 30m, its diameter is 5m, has 3000 ducts and its weight is striking 140 tons. We are the supplier of such facilities to almost all of the big European-based companies.
She called the attention to the point that for the recent years Biomashin has been engaged on large-scale comprehensive projects. One of them has recently been implemented for Saudi Arabia.
‘Recently, we have stood out with the fact that we work on comprehensive global projects. For example, we worked in Saudi Arabia for the fastest-developing F&B company, Almarai. We have produced the equipment to meet the demand for a number of their projects, just one of them requiring 80 various devices,’ explained Philipova.
A project of this kind takes some 3 to 6 months before it’s done. The largest-scale one so far implemented by the Bulgarian company strikes the figure of 4 million leva.
The challenge is not only designing and manufacturing the products, but also transporting them could be quite a challenge given their unconventional size. The biggest trouble proves to get them
The challenge is placed not only by the design and manufacture of the products, however their carriage could be quite of a challenge given their unconventional size. The greatest trouble proves to be getting them conveyed from Plovdiv to the ports on the Danube.
‘Biomashin’ as the key supplier for Nestle, Danone and Mondelez
Before 2007, the Plovdiv-based company exported for the most part to East European markets, including Ukraine, Russia, Moldova, Macedonia and Romania. At the time, the company had the major part of its clients in the wine-making industry.
‘We realized that the products for that industry were not as complex as the facilities, still the competition was intense. That precluded our chances to advance’, Philipova admitted.
‘We identified our competitive advantage in producing complex products with high added value, that are comprehensive and meet the highest quality standards. That was the reason we picked production of process equipment’.
So currently Biomashin has become a supplier for some of the most reputable engineering companies as well as for some of the leading F&B manufacturers. Listed among its major clients are Tetra Pak, Gea Group, Nestle and Danone. For many of them the Bulgarian company is a key supplier.
A part of the company’s production is placed on the Bulgarian market. ‘The Bulgarian market, however, does not cover the full capacity of our size. Among our major Bulgarian clients are the multinational companies such as Mondelez, Nestle, Carlsberg, Coca-Cola and the Bulgarian manufacturers such as Madzharov and many others,’ shares Philipova.
A double income and 100 new jobs by 2023
The area in Plovdiv where Biomashin’s base is located takes some 85 000 m2, with а 10 000 м2 covered area, however it is scheduled doubled in the next couple of years. Respectively, the company is to open 60 to 100 more jobs.
Those are some of the plans mapped out for the upcoming expansion of the company’s manufacturing facilities, which would cost 10 million euro. That was announced last year, with the project being co-financed by the European Bank for Reconstruction and Development (EBRD).
‘The program covers a large-scale project for is which is to double our production both in area and capacity. We have been re-investing 100% of our profit, with our sales revenue in the past year being 23,5 million leva. We believe, by 2023 we would come out with twice as much,’ estimates Gergana Philipova.
To this date, the first of all three new manufacturing buildings has been completed, as well as a new goods stock site. This marks the completion of stage 1 of the project and implementation of one third of the investment.
‘The project will enable us to better organize our production flow. We will cope with bigger and heavier facilities. Having the base expanded, we are planning to open more jobs as well. As our estimations go, we are going to hire 60 to 100 new employees,’ shared Philipova and went on:
‘Speaking of whom, these will be highly skilled employees, essentially machine operators, highly skilled experts, engineers, construction specialists. We are going to employ them for the course of 3 to 5 years until the finalization of the complete project.’
