The FINANCIAL — Paata Kurtanidze, General Director of Aversi, was born in Kutaisi on 21 December, 1967. His father was an engineer, his mother an accountant. Paata Kurtanidze has a wife and 6 children.
He graduated from Tbilisi State Medical University, the faculty of paediatrics. Whilst studying at the university he was called up for military service in Ukraine and Czechoslovakia.
His first business step was supplying drugstores with medicines. In order to make this activity legal Paata Kurtanidze registered his pharmacy company – Aversi, on November 14, 1994. Aversi means a spiral up run in Latin.
Q. You are one of the most successful businessmen in Georgia. Was it your goal to become a millionaire?
A. It wasn’t my aim to earn money and to become a millionaire. During the last 15 years I have held close the following quotation of one American businessman: “If a person begins his activity with the aim to become rich, he has little chance of it. And if his first aim is to serve people, provide a high degree of quality, then money will find a way of getting to him itself. To provide products of high degree and to serve people is a considerably greater affair, than a desire to become rich”. This turned out to be a real life story for me and that’s why I have kept these words written with me always.
You must think about what people need and not how to earn money. I never thought about becoming a millionaire, even today I am not a wide profile businessman and I don’t want to extend my business past the pharmacy market.
Q. What inspired you to start your own business?
A. After the collapse of the Soviet Union, in 1994 there was a huge deficit of everything, especially medicines. I was a student and had practice in the hospital, where there was a serious lack of medicines. Patients had to bring everything: gauze, bandages, medicines and even petrol for the generator.
The idea of bringing medicines in to Georgia from abroad was born that time. I decided to open a small drugstore. Later my business developed as a matter of course. In a month I bought a computer, then I was able to buy a generator, fax, Xerox machine, and a car as well.
I always dreamed of being a doctor, but making such rapid progress and employing people was so pleasant that I couldn’t leave it. I was thinking that I could be a doctor and a businessman at the same time. My friend told me that I would be the best doctor out of the businessmen and the best businessmen out of the doctors, but both need 25 hour working days so I had to make a decision. I chose business.
Q. How about when you first got started?
A. First I went to Moscow with only 70 USD to buy medicines. At that time there was inflation in Russia. If the medicine cost 32 RUB in Moscow, its price was 300 RUB in Georgia. Thus, to buy and bring these medicines to Georgia was very profitable.
First I brought only a few medicines for the drugstores. Later I found that the same medicines were cheaper in the peripheries of Moscow than in the centre. For example, if the medicine’s cost was 32 RUB in the centre of Moscow, its price was 1.20 RUB in the peripheries. It was a result of the inflation that gave me the possibility to buy the medicines at low prices and to bring them to Georgia. It must be underlined that it was very profitable.
Q. How did you make your first 1,000 USD?
A. I made my first 1,000 USD in the first week from the beginning of my business. I was bringing 200-300 kilograms of medicines from Moscow and Kiev and accordingly it was very profitable. The most pivotal moment for us was in November of 1995, when several companies in Kiev and Moscow offered me medicines of the value of 700,000 USD.
We weren’t able to transport such a quantity of medicines by commercial airplane so we had to hire an airplane and this way we brought them to Georgia. These medicines were sold in 2-3 weeks. Later, during a similar period, we hired an airplane to transport medicines again.
Q. How do you keep your team motivated?
A. More than 4,300 persons are working at Aversi today. We are doing our best to keep our team motivated. For example: each employee has a fixed salary and bonuses too. A fixed salary is good for a lazy employee, because they know they will get their salary regardless of how much effort they put in to their work. But for hard-working employees, a fixed salary is not attractive.
Therefore we also have monthly and yearly bonuses, free travel gifts. We have a special gift for newlyweds, and when both are our employees, the bonuses are even larger.
Thus we encourage marriage between members of our company.
We have maternity bonuses for our employees as well. The more children one has, the higher the bonus.
Q. What does your typical workday look like?
A. I have a very busy schedule. I plan each day in advance. For example, on Thursday I get up at 7:10 am, I then do morning exercises for 12 minutes. I always have my breakfast at exactly 8 am. Later I go to the clinic, presenting medical conferences. This continues for 40 minutes. Then I go to the enterprise, where I hold meetings with different departments. At 13:00 o clock I go to the office where I have planned meetings. I always have my lunch at 3 pm and then I sleep for 18 minutes, this time is enough to renew my energy. Then I continue working with consistent energy till 8 pm. After that I go to the pool, where I spend an hour.
Q. How important is it to plan one’s future?
A. I always plan everything in my business and in my private life as well. Planning the future has many positive sides. 1. You spend your time very rationally; 2. You aren’t nervous when you know what you are to do next; 3. You do everything well; 4. You get pleasure from doing your work and at the same time you are able to let others get pleasure from their work too.
I always give advice to my employees: It’s better to do less but do it well, than do many things badly. Thus, I think that planning is very important.
Q. What have your greatest challenges been and how have you overcome them?
A. I experienced the greatest challenge in 1998, when there was inflation in Russia. The RUB depreciated by 6 times relative to the USD. That is why I had to sell expensive medicines cheaper than their worth. For example, if I had paid 0.18 USD for the medicine, I sold it for 0.5 USD. Of course, it was a serious financial loss, although we managed to overcome it. So to manage a business is very difficult and to run a successful business is even more difficult.
Q. Can you tell us about any initiative or project that you have failed in, and what you learned from it?
A. Such a failure happened just several months after starting my business, when there was a great request for Polish medicines in Tbilisi. A few Georgian residents of Poland were sending us the local medicines. They then asked us to send them Georgian poniards (a type of dagger), because they sold well in Poland. Of course we sent them a certain quantity of poniards. They really sold well and with the money from them we bought more medicine. Later an idea was born to have a poniard shop, which needed 300-500 USD to start. We put this money in a new business, but we had already lost 500 USD and accordingly this new initiative failed. What was good was that I realized that I would never again invest money in a business, the success of which would not depend on my work.
Q. How important is it to take risks?
A. It is unimaginable to have progress in business without taking risks. It is impossible to foresee certain things in business, which is why it’s very important to have intuition. Sometimes you make a decision which is not justified by financial foresight but your intuition says that you must behave so. To understand to follow your intuition properly you must be a specialist of the field.
Q. When you first started, did you ever imagine you would be this successful?
A. I was born in a poor family. My mother was an accountant. When I was a student my father had a heart operation which meant he couldn’t work for 3 years. I had to live with my allowance and I was trying to save money on food and transport. I was very happy when I managed to save just 5 RUB for myself from 40. Most of my friends were from rich families, but I never thought about why they had more than me. I was sure that the time would come when I would become a successful person.
Q. What do you attribute your success to?
A. Our company has been in existence for 16 years. Today Aversi is a successful company and I want it to cement it for all time. I want Aversi to exist for centuries.
In my opinion, the reason for our success is our aim – the client must be content with our service. And we do our best to reach this aim.
Three things are important for selling a product: the price must be acceptable; there must be a high level product. It’s also important how you offer your product to your clients. 10-15 years ago, the main thing was the price of the products, but later it became important how you offer your product to your clients.
I can’t personally serve each client in every drugstore so I decided to award my employees with high salaries and good conditions in order for there to be a high level of service in our drugstores. This is why I always have content clients and employees.
Q. How has your success changed your life?
A. Every morning I still feel as though I haven’t yet reached great success. My outlook on life hasn’t changed.
Change is the deficit of time that I have now. I am trying to use each minute, but I had this personality trait from my childhood. I don’t think I have changed. I have a great desire to spend more time with my children, with my friends, but I can’t manage it all the time because of my busy schedule.
Q. What advice would you give people who aim to become millionaires?
A. First and foremost is to realize exactly what you want. The earlier you do, the better. It’s very bad when a person changes his profession and job too often. The sooner he realizes what he wants, the sooner he will reach success. If he decides to become a businessman, he must provide the thing society demands. What do clients need nowadays? – This is the first and most important thing to foresee.
