homepage_name! > Editions > Number 036 > Interview


Miroslav Bogicevic, owner and director of Concern Farmakom MB

Concern Farmakom MB was established in 1989 and started its operations within the field of trade as “Farmakom d.o.o.”, dealing, first of all, with import of raw materials for chemical industry. During the first decade of its existence, the company achieved extraordinary results within this field, cooperating primarily with Zorka Sabac company. With the change in market conditions in Serbia and after preconditions for starting privatizations were met, the company changed its focus from trading towards production activity, starting process of acquiring production companies and investing in them. During multi annual efforts, it reinforced foundations of these companies enabling them to have solid and successful start of new business ventures. The company has achieved excellent business results in many fields with further continuous investments in research and development, as well as with application of new technologies, spread fields of its business and developed aiming at becoming local and international leader in the field of production. During 2006, the company became a concern, operating successfully as Concern Farmakom MB ever since. At present, Farmakom MB includes nine separate companies and operates in three industries: agriculture, metal processing industry and mining.

Miroslav Bogicevic

The story started in the late 80’s of 20th century, when present Director of Concern “Farmakom MB”, Mr. Miroslav Bogićević, left his position in public sector to set up two pharmacies.

He decided to take such step feeling desire and strength to face challenges of private business.  

Mr. Bogicevic, where were you born, what schools did you attend?

I was born in Sabac where I finished elementary and high school and I graduated from college in Sarajevo.

I started to work in Social Insurance Institute. At that time, in 80’s, it was legal and pursuant to law to establish private company even if you work at public company. Of course, I exploited such opportunity and tried to find myself in private business.

When such law was abrogated, when I could no longer hold both positions, I decided to stay in private business. At the beginning, I dealt with pharmacies with human medicaments.

When did you set up the company Farmakom and what were the starts like?

Farmakom was established in 1989. I started with a pharmacy. I am natural fighter and I realized that if I wanted to succeed in private business, I could not be satisfied with one pharmacy only, that I had to develop my business. Then I set up the second, then the third one, in Mitrovica, then in Ruma… At that point I realized how it should work to develop the business.

With no false modesty, I had a good vision, as I have it now. Of course, it much easier now, because I have a lot of associates, but back then, I had to organize everything by myself, to plan, “push” the business, etc… Today I employ 3.000 people, of such number about 50 of them manage the companies, plan and organize and it is a lot easier now.

What did the development of Farmakom look like? What was the main business activity until the time you succeeded to become the owner of 9 big companies?

As I have already mentioned, main activity of Farmakom was trade with human medicaments. As the business grew, I decided to invest in supply and/or import of raw materials for former “Zorka”, which operated poorly at that time. We also did zinc finishing and plant protection, which conditioned conclusion of contract with Zorka- Mineral fertilizers in the end of 2003. Cooperation and/or lease lasted for 4 years in accordance with contract and everything was working well.   
What companies are members of Farmakom MB and business activities do they deal with?

We have 9 companies now, which are PIK 7. juli Debrc, Mlekara Sabac, Zorka stan and Zorka Extruded packaging factory which were included in parent company – Farmakom, then Batteries Factory of Sombor, Mine and Smleter Zajaca, iron foundry Pozega and at the end I bought mining Lece in Medvedja and Mining Suva ruda in Raska. All acquisitions were made within period from 2003-2008.

I bought some companies at the stock exchange, some from the government. All those companies, except Batteries Factory Sombor were producing losses, inclusive of Mlekara Sabac.
How many people does Farmakom MB employ at present? How and how much do you invest in education of your employees and students scholarships who are prosperous employees in some of your companies?

Farmakom has 3.000 full-time employees, and there is certain number of part-time employees. We provide scholarships amounting to EUR 150-200 for all children of our employees, as prosperous professionals who will work at some of our companies. At present, we have about 250 scholars.

Speaking of education of our employees, each company has own plans for their education. We have special group of people dealing with such matters. It is very important, because a person has to learn lifelong. There is not a single person who can say he or she has learnt it all and does not need education and development.

We pay great attention to education: we have agencies, outsourced associates who help us. We conduct education in different manners and in variety of fields, from production to managerial improvement. One more reason on behalf of education is that we constantly invest in new technologies and modern equipment. In order to keep up the pace with the world, employees have been constantly educated and taught.

We have a good team, from workers to engineers. An engineer has to be familiar with technological process in all plants in the factory.

How many closest associates do you have and how do you manage and control entire system?

As I have said, about 50 of them are “pulling” entire system forward and they are my closest associates who I communicate to and work every day. We have excellent communication.

That is how we have developed. We have made friendly and family-like atmosphere in companies. We do not function based on force and I think that bring a new quality to the Concern and that makes me very satisfied. In general, we are family business. 
You have received many prizes and recognitions. Which of them could you single out as the highest recognition for your work so far?

Of course, the highest recognition is the Businessman of the Decade. It is specific because journalists from 14 offices have chosen me and it means me a lot, I see that my employees are also very content. 

What has made me particularly happy is that I received more than 1000 New Year and Christmas greeting cards from my employees. 

Number of my mobile phone has been the same for years, from the very beginning and each employee can call me and visit me, to have a talk, solve problems, even personal ones.
Despite the fact you have large business experience, you are rarely present in media. Why?

It is very simple… I have no preferences to promote in media, and I do not have time for that. We work all the time; we do not work on January 1st only. When I say “we”, I mean myself and my associates.

Therefore, I do not have time and I lived much better when I was known less.

Is it true that you are interested in acquisition of weekly NIN? Do you think that it is profitable to invest in media today?

I am optimist by nature and I think that everything can be done, but all depends on people and their business concepts. I was interested in acquisition of NIN, and their invitation was impressing, they asked me if I was interested in joining them in the “story”.

I said I was, but only if more than 50% of the people in editorial board agreed to that.

We had a meeting and they say that it was the first time that all employees attended a meeting. I noticed undivided opinion and that all were equally interested in.
We entered the “story” but there was no realization due to some other reasons, one of which is a law imposing condition of having no less than five-six years of experience in such field. That way, regulations disabled me to realize such business.
What does global economic crisis mean for you? When did it start and will it end? In your opinion, what was the cause of global crisis?

Speaking of the cause, opinions have varied. As I think, banks have extended themselves beyond their capabilities; they have invested in business which could not have return. Then, it has turned into a chain reaction…

I think that financial institutions contributed that we became that way aware of global economic crisis, but I think none of that should have happened because we had already functioned as in crisis, and we should not have been additionally pressed by effects of global economic crisis.

What did global crisis affect operations of your Concern?

Of course we were affected. Everything slowed down. In 2004, we made a development plan and operated normally until 2008, but then we had to make some other plans and to adjust to new market. Of course, then we found out that we had to change some things. One was to save and we take care of expenses a lot more now.

We also realized that we had to continue to invest because if we stopped, we would be doomed.

Concern Farmakom MB operates on international market, as well. What do you trade most on that level?

Concern is a large exporter; we export batteries, milk, products of Guca and Pozega foundries. This year, we have started to export concentrate from mining Lece. We will export it until we solve some issues regarding equipment in Zajaca, so we can process such concentrate. It contains a lot of gold and silver, but currently we do not have technical capacities to process it. When conditions have been met, we will process it and export it as metal.
During post privatization years, all of your companies have managed to achieve positive results. How did you manage that?

As previously mentioned, I achieved everything with hard work. My team works 24/7 and all of those 50 people work 20 hours. Simply, if you want to operate well, even if you run only a kiosk, you have to work a lot to succeed. 

Besides work, there are also good ideas, organization, planning, many things influencing normal operations. But, at the end, it all comes to working day and night.

How do you assess present economic situation in Serbia? What should be changed, if any?

What stands for Concern can apply to entire country, meaning “mining” which can bring Serbia many benefits, with good strategies. More people would be employed and their lives would be better.  I am sure that good planning can bring quickly a lot of good things

What should be done? Projects, many of them in Serbia and very good ones, should be financed. Export should be financed, because there can be nothing without.  We have a rule in force: “export or die!”

Could you make observation of milk shortage situation in Serbia in 2010? What happened?

Every year, we have hyper-production and hypo-production of milk and that happened this time. Of course, the situation has worsen because milk producers started to slaughter cows, i.e. to destroy livestock, which is logic, because they could not survive on such milk production. All other countries in the world subsidy milk producers. The price we give them, without somebody else’s help, could not survive. If we had reached purchase price for the milk, we must have had to rise price of finished product, and then again we would have been in difficult situation.

Now, there is hyper-production of milk again, there are no shortages, and we started to export.

We did not raise prices of our products but we increased purchase price of milk, because we had realized that we had to finance producers.

We are responsible company and we realized we cannot be successful if we do not take care of our environment and partners. In such situation, we were careful not to increase prices for milk because it would be disastrous for image of our dairy. Of course, it was not easy period for us, but we said to ourselves that we have to endure and we did.

Farmakom MB is a leader of “green economy” in the region. How and how much do you invest in environmental protection? What are your plans and goals?

Factories that we took over were in catastrophic condition, in terms of ecology and working conditions. Our first investments were in ecology. It is extremely important for workers in those factories, as well.

The most up-to-date equipment of batteries separation in Zajaca, meeting strict European environmental standards, cost 5-6 million of euro. That is the way we invest in all factories. I am very satisfied we took such road, because if we had not, probably we would not have been able to work. There are laws which have to be obeyed to, and our intent, strategy and wish were sincere.

I have been advised to invest first in production and then in ecology. But, I did the opposite and it works excellent.

How do you take care of energy efficiency in the companies-members of your Concern?

We have a team dealing with issues of energy efficiency. I am very satisfied how the experts resolve such issues.

How do you take care of local community?

For us, it is very important that local community is satisfied with us. We take care, we are the company which constantly employs, not dismisses.  Whoever has come to Farmakom, stayed, and I am very happy that none of my associates, nor any of other employees left Farmakom.

We saved during the crises on everything else but not on the account of employees.
Your company is among a few ones in Serbian market dealing with production only. How do you constantly increase production within your Concern?

During the last 4 years, Concern has invested more than EUR 150 million in production, quality, working conditions and that has had results. At the time of crisis, we have managed to complete investments and now, Concern is quite different. It has grown twice every year compared to previous year.

We have a good strategy, good vision, we export a lot and we adjust to market.
How have you achieved independency raw materials – related and how do you control quality of products?

When purchasing companies, we have chosen those with raw materials on local market. This applies to foundries, smelter in Zajaca, to dairy. We were not importing raw materials until the end of last year, but considering the increase in our production, especially in batteries factory, we started to import, as well.

We know why production in Serbia has suffered during previous years – because it was in lack of raw materials. This is the reason why we use knowledge and experience from previous periods and we adjust to situation. That way we have started to import raw materials from Congo, Egypt, Mali and other neighboring countries, along with present, domestic raw materials we have achieved independency related to raw materials. Not only that, but we export production surpluses, which we do not use in batteries factory, through some other products, such as lead shots for sports hunting.

We have a great team working on products quality control. In every company, strongest teams are those working on investments and products quality control. Now, we have almost all certificates of quality recognized internationally, everybody in our companies must have all certificates, necessary for us to have normal course of business.

In which areas did you invest most in modern technologies and which modern technologies do you use in production?

We have invested most in dairy.  What is interesting is that Dairy Sabac can produce most feta cheese in the world in one plant, when it comes to packages of 250 and 450 g. We have assessed that it is a product with future, and if we want to export, we must have equipment. Accordingly, the most up-to-date equipment for cheese production has been purchased, and producer claims it is the biggest line set up in the world so far. Therefore, we have invested in several processing phases, as well as in expansion of range of products. Batteries factory has expanded its portfolio and enriched it with numerous new, modern types of batteries.

We have been constantly under the pressure that product must have both quality and quantity. We take care of that, team has been improving, we are present at all fair shows, symposiums, we visit factories all around the world.

How do you relax from everyday stress?

My associates and spend almost every night at the Farmakom restaurant so we do not have to talk about business in the office all the time. Change is good. We have dinners there, socialize, but in 90% we talk about business. Sometimes, we watch a game or discuss other topics. It relaxes me.

How do you spend your spare time?

Unfortunately, I do not have free time and I often think how I would like to be bored at least one day.

Advantages of being successful businessman in Serbia are obvious but what about disadvantages? What makes your life harder?

Only the thing that I do not have private life. The only real thing in life are children, everything else is insignificant. I miss my children and grandchildren. When I come home, they are asleep, when I leave, they sleep, and this is very difficult for me.

If you could change anything in your career so far, what would it be?

I would not change a single thing, not because I think I am so smart and that I had done everything right but because results, accomplishments as well as satisfaction of my employees speak that I have been on the right tracks.