Sysert-based porcelain factory is expanding its share on the domestic chinaware market with the help of an unusual strategy: original design and familiar with Russian tea-drinking habit, rather than production and distribution

Zarina Khisamova 

The town of Sysert is known mainly for its cheap salad bowls and mugs decorated with pale flowers. For forty years, these Sysert porcelain works products have invariably been for sale at every housewares department across the Urals.
Today, however, a long table in the plant director’s office is covered with beautiful sets of porcelain dishes. Their designs make those living in Sysert especially proud, and the factory has patented them both in Russia and abroad. Leaders in the world china industry have already declared that they want to make these patterns. Among those interested is the famous Rosenthal whose designs are developed by Versace and Bvlgari.
In the near future, the Urals craftsmen intend to give foreigners a run for their money in the mass-market and mid-priced segments of the Russian chinaware market. Such ambitious plans may amaze those who know something about the current situation in the Russian porcelain industry. It is crumbling, as most enterprises have no clear positioning, the old distribution system has collapsed, and sales are falling in a market dominated by foreign products. 

Salad bowls for the people

The Sysert factory was built in 1960 and from the very start focused on goods for mass consumption. Its small museum looks like the china section of some godforsaken Soviet housewares store. In the early nineties, the factory was privatized but little changed for the better. Employees became stockholders, as was the case at most porcelain plants, but its leaders and policy remained the same. The flowered salad bowls from Sysert were purchased less and less frequently. A horrible rival – China – appeared on the cheap mass-market segment. In the late 1990s, the stockholders requested their good acquaintance, Vladislav Charsov, a professional consultant in anti-crisis management, to help the enterprise, now on the verge of bankruptcy.
Chasov began his tenure at the factory by implementing a rigid quality control system, eliminating barter, and putting the factory’s books in order. However, this wasn’t enough, and Systert’s indicators didn’t improve significantly. The new director came to the conclusion that the problem was equipment. The machinery used at the Sysert factory was bought secondhand twenty years ago from Czech and German factories. “Our employees’ hands could make a Mercedes but the equipment at the factory was designed to make Soviet Zaporozhets cars,” Charsov explained. Everything began to change when Charsov attended an exhibition in Frankfurt where representatives from two thousand porcelain factories from all over the world come together twice a year.
The trip to Germany and the first cursory acquaintance with the European porcelain industry radically changed Charsov’s views on how to promote his enterprise. When he saw the place of Sysert china on the global market, he was overcome with gloom. Charsov realized that he had to change the product range and introduce new shapes and patterns. Otherwise, the “Mercedes” hands would continue to produce pale salad bowls on “Mercedes” equipment.

Plates for the new elite

A market survey conducted in Yekaterinburg, Chelyabinsk, and Tyumen at the request of the Sysert factory found that the niche of expensive, exclusive chinaware was still wide open. To take it over, Charsov needed to solve two problems: how to decide on a product line and how to improve the skills of factory artists and porcelain specialists. Manufacturing piece goods with hand-painted designs requires high skills, but artists were a little rusty after the years of downtime.
Charsov and his associates set off to museums and antique shops and then began literally with a magnifying glass to look at catalogues of the world’s porcelain brands. Finally, they found a concept for their products: the Russian porcelain of the ancien regime, filled with pathos and patriotism, with portraits of emperors and war heroes, majestic landscapes, heraldic symbols, and highly ornamental designs in gold, cobalt and purple.
Sysert decided to offer the new Russian elite old-world porcelain that took modern realities into account. They seemed to hit the mark by offering china sets decorated with the portraits of companies’ board members, plates with views of corporate offices, and cups with company logos. Local businessmen, followed by entrepreneurs from neighboring regions, ordered this quite expensive china in droves, even though an item decorated with a hand-painted landscape or portrait costs from $200 to $1,000.
Manual labor plays a large part in making such exclusive products. Therefore, the enterprise didn’t need new equipment. Sysert producers meet their increased need for white, unpainted china partly by themselves and partly by ordering it in Europe. They also import high-quality paints and porcelain mixture from Europe.
To reduce production cost, Sysert began to actively explore the potential of high-quality polygraphy, a technology widely used in Europe but not in Russia. When more than one piece of china with a complex design is required, factory artists make a pattern. It is then scanned and used to produce a decal in Germany. These transfers are applied to a finished mould in Sysert and kilned. Even many specialists can’t distinguish polygraphy from hand-painted designs, yet the cost per item is reduced by several times.
The factory’s new, expensive products called for a new brand name as well. Charsoff Porcelain is now stamped on the underside of Sysert china. “I love my native town,” says Vladislav Charsov. “But beyond the bounds of Sverdlov Province, the word Sysert sounds strange. To an outsider, it sounds like Snakesville. Such associations can only impede sales of our elegant and beautiful products.”
The exclusive range at Sysert also includes unique products like iconostases. In Sverdlov Province, as in many Russian regions, old churches are being restored and new ones built. Churches install wooden, marble, and more and more frequently porcelain iconostases. They look elegant and their color doesn’t dull with time. The formula for this product is the same: a large proportion of manual labor and as little equipment as possible. As with china, Sysert producers take a serious approach to the artistic side of production. Each iconostasis is created in cooperation with professional restorers and architects.
Of course, the iconostasis market is quite small and they are not replaced as frequently as kitchenware. However, this product brings the company about 30% of its earnings and gives it an opportunity to develop other, absolutely new areas of business. 

In search of a subject

One such area is the design bureau that diverged from the company a year and a half ago. Its main task is to look for new images and design ideas. “In the 1930s, the Lomonosov Factory invented a cobalt grid design that became its main trademark and is now patented. Both Russians and foreigners still buy Lomonosov porcelain. Our dream is to invent something of our own that would make us famous,” Charsov says.
The factory’s best artists work at the design bureau. Porcelain specialists from all over Russia bring their work here, having heard the entrepreneur in the Urals is looking for ideas and pays decent money for images that strike his fancy. A few mid-price segment-oriented sets have been created this way. Once, Charsov showed them to his German partners. They went wild, saying that they were a porcelain design innovation that was necessary to patent and then start licensed production in Europe.
“I think this is because we have a new approach to decoration and new subject matter. Look, this is a hunting scene. None of the patterns are the same. You want to turn, move, examine the cup, the sugar bowl, the teapot. I think Europe has gotten tired of the simple geometrical patterns that have been fashionable lately. Each piece in this set is like a work of art.”
Several German companies have voiced their interest in licensed production and distribution of Sysert china, and the company is currently in negotiation with them. Charsov doesn’t disguise his desire to strike a deal with the Europeans, either.

The problems of tea drinking

The Sysert factory has plans for the mass-market segment, too. Today, this segment is occupied mostly by Czech and other Eastern European producers. Sysert believe that they will be able to squeeze out the foreigners. First of all, they could offer lower prices – 1,200 rubles per set (while imported ones cost 1,500-2,000 rubles) – for the same quality of porcelain and design. Secondly, the folks from Sysert are confident that they know their customers and the specific habits of Russian tea drinking far better.
“We have thoroughly examined Russian tastes and we know exactly what volume and diameter of cup and what handle shape Russians like best. They don’t like tea sets with small cups, because after you take out the teabag, there is hardly any tea. The Czechs and their neighbors make exactly this kind of cup. It makes no sense at all to produce coffee sets in Russia: we drink coffee, as a rule, from the same large teacups,” Charsov says. “Most Europeans don’t drink tea at all and don’t understand what we need. Moreover, Eastern Europeans traditionally manufactures floriated sets, whereas the Russians like more complicated decoration, with a picture or subject. British tea culture and their sets are closer but they won’t work on the Russian mass market.”

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