Interview with owner and executive director of Harwal Company Harut Hovhannisyan
Owner and executive director of Harwal Company Harut Hovhannisyan is considered to be one of the unique businessmen in the industrial field that knows all delicacies of economic fields as well as nuances of production and new technologies. His factories release more than 5000 products, most of which are construction materials. Araratnews.am had an interview with Hovhannisyan in Yerevan.
—Mister Hovhannisyan, how did your business cultivate and what path did it pass?
-It all started from a family business. My father owned a printing house in Lebanon, and in 1968-69 I took up that work myself. It became wider by time and in when the civil war started in Lebanon in ’72, we moved to Europe, Cyprus, Italy, Saudi Arabia and at last, we realised that the best place for us is Dubai. Starting from 1976 we moved the most part of our business to Dubai and began enlarging it. There was no Harwal brand time. In 1981 we founded Harwal with a colleague from Holland, who was the marketing director of a company that used to get material for us. Harwal is made of first letters of my and his names. We have 4500 employees now and 30 factories in UAE: Abu Dhabi, Dubai and Sharja, we have also built 6 factories during the last 3-4 years in Saudi Arabia.
We have 2 factories in LA, 3 factories in Russia and several investments in Armenia, including Poliplast, Zovq, and Armeconombank. Our yearly circulation is 625 million USD and will get bigger in coming years. Economic crisis affected greatly on our Russian investments, USA and UAE businesses. Now we are coming out of crisis and have 15-20% increase annually.
-So, your business has enlarged a great deal during 40-50 years. Do you have any special strategic features to succeed?
-Main features of our strategy are territorial, market and products the diversification, in order to no depend on one land or product. For instance when there was crisis in Dubai, we had success in Saudi Arabia. Surely, management of diversified company is very hard, as every department has its own professionals and delicacies. We have different partners in every country, every one of them with unique psychology, however, such hardships are surmountable.
-What are the main directions of your company?
— 65% is production of construction material. Pipes, for example, make 18-19% of our production; electric key system makes 18-20%. We produce building walls, and we have big factories in the Middle East which produce 4 million square meters annually. All of that makes 65% of our production, as I have mentioned. 20% of our production makes packaging tools, household goods make 15% including tables, chairs etc… We also have production of mineral water and juices both in Armenia and Dubai.
— What is the situation today in the world of technology? Is the necessity of importing new technologies big and is there any tension in this field?
-Yes, There is a huge difference between the technologies of today and of decade ago. We have a centre with 350 engineers working, who follow the development of new technologies in the world. They unveil new technologies which can be used in the industry. I manage that part of the business which is very important.
-You are not just the owner of Harwal, but also the executive director. In a big company as it is management is separated from the owner. How were you able to unite these two directions? Isn’t it hard?
-There are no difficulties as we have created a professional team. We have employees that are working with us for almost 35 years. When they retire they want their relatives to take their place in the company. Harwal is a family of 4500 members. It’s not easy to become our employee but we do not let a good professional go easily.
—Who are the main consumers of your production?
-We sell our products in 58 countries, both in USA and Europe. We are the only provider of some products to European market, for example garden houses. We have sold 90 thousand houses last year. We have a production in USA and have transferred a part of our Dubai production there. In general, we are exporting 45% of our production. Most part of construction material is in the Middle East: Saudi Arabia, UAE, Oman, Qatar, Bahrain, Kuwait, Iraq, Lebanon and Jordan. We have enlarged to Egypt, Northern Africa and Great Britain.
—What are the main differences between economic regulations in those countries? Where is the easiest?
-Every place has its own difficulties. There are bureaucracy problems in Europe. In that field, it’s easier in USA. There are different problems in the Emirates concerning visa regime, employment of foreign citizens (we have a special department that deals with such issues) etc… Every country has its difficulties and advantages.
-What plans do you have for coming 5, 10, 15 years?
-We must continue our strategy. Crisis in 2008-2009 was profound and affected greatly at the time we were enlarging. We were able to overcome it anyway due to diversification. We must continue working on the quality as well. We have always produced best quality goods and it must remain the main strategic aspects of ours. We are planning to increase our production with 15-20% annually. I can’t say anything for the coming 10 years, as many changes occur in the Middle East.
-So, it seems you are typical Armenian family. Will you tell a bit about your ancestors and your children?
-My ancestors have gone to Lebanon after the Genocide. My mother was born in Lebanon, and so was I. I have 3 sons, all of them were brought up as Armenians, thanks to my wife who brought them up, while I was busy working. All of them studied in USA got married to Armenian ladies. Now we have 7 grandchildren: 4 granddaughters and 3 grandsons. We tried to raise them as Armenians as well, but it was hard. My eldest grandchild is 18 and the youngest is 7.
