Big Poultry in Georgia

Big Poultry in Georgia

Georgian poultry producer Chirina Ltd will surprise you in more ways than seems possible. If this vertically integrated operation was built in Brazil, USA, Thailand, or Poland, it would still outshine all its neighbors. But to create this in the Republic of Georgia – a country many people struggle to find on a map – is truly amazing. MPJ suspects that if you look up ‘foresight’ in a dictionary, next to the definition will be a picture of Revas Vashakidze, founder and president of Chirina, and his niece, Keti Vashakidze, deputy director. MPJ talks to Keti Vashakidze to find out their secret in achieving very-near poultry perfection.

In Georgia, is poultry seen more of a healthier meat protein choice or as less expensive option?

Keti Vashakidze, Chirina: I would say both. Chicken in Georgia is considered as a very healthy product. But at the same time it is important to note that it is one of the cheapest source of protein making it highly demanded product both in Georgia as well as in the rest of the world.

Was investment internal or were you able to tap into funds from the Produced in Georgia program?

Keti: Our investment was mainly internal, but we have also participated in government programs like “Produced in Georgia.”

2013 is the official start-up date for Chirina. Was the entire operation up on-line at this time – corn production, feed mill, hatchery, farm, processing plant, distribution – or was it a several years process?

Keti: In 2013, all the processes were up and ready for operation. End of August 2013 was the first time we introduced our meat to the market. But for producing the meat we needed to start up various business lines in different time periods. First was the startup of raw material production, its drying and storage facility, which we did in 2012. Farms became operational in December 2012; hatchery in May 2013 and the processing plant in August of 2013.

From what I can see, in Georgia there is nothing like Chirina. Where did you get your inspiration from?

Keti: Georgia is one of those countries where after the breakup of the Soviet Union, most of the production and processing was destroyed and put to ground. Since then the country has been feeding itself mainly with the imports. For succeeding in this business, we needed to build everything from the ground up; we needed to build vertically integrated production lines – operations that would enable us to compete with the imports. We have studied a lot about the business models existing in European countries, in post-Soviet countries and tried to implement the best practices in Georgia.

From day-one was it decided that the entire operation would be vertically integrated to the extreme that it is?

Keti: Since there were no proper facilities (feed mill, hatchery, and so) for this industry in Georgia we needed full vertical integration for this business. That was the decision made from the very beginning.

 

Right now, around 70-80 percent of all poultry consumed in Georgia is imported, has it been hard breaking into the poultry market?

Keti: Actually, the percentage is 60 percent. When we entered the market 90 percent of consumed poultry meat was being imported; nowadays thanks to our production, this percentage is 60 percent. I believe we had right strategy for breaking into the market: latest technology and knowhow; utilization of economics of scale; our own retail chain; good distribution; good quality product at the right price.

At times with some countries/companies able to do massive production and combine it with cheap shipping costs, it’s impossible for local farms/processors to compete. For example, in California I visited a large lamb processing plant. You would think that at the closest supermarket – just a few miles away – it would be selling their lamb. No, Safeway sold lamb from New Zealand because it was cheaper. Does Chirina have the same problem with poultry imports?

Keti: Economics of scale enables large integrators to position their products at a competitive price in different parts of the world. And price is crucial for this product. Due to having latest technology, industrialized production of poultry meat we are able to successfully compete with the imports. Another advantage that we have is that our emphasis is mainly on fresh meat, the quality of which exceeds frozen imports.

Georgia is in a fairly idea location with neighboring Turkey, Armenia, Azerbaijan, and Russia, along with having a Black Sea port. Are you looking at the export market or first trying to capture the Georgian?

Keti: Export is the next step of our company development. Our main emphasis as of now is still to expand out production locally in Georgia, but we are starting to look more into export potential.

Is halal or kosher an option you are looking at?

Keti: We are looking into it, particularly into Halal certification and believe soon we will get consequent certification as well.

The work finished in 2013 was called Phase 1; has there been a Phase 2 yet?

Keti: Since 2013 we expanded our production, added new facilities and doubled our production in 2015. Further expansion of our integration and tapping into meat further processing is the emphasis of our company.

With Agrotop [turn-key engineering company], Meyn, using air chilling technology, etc, just luck on your part picking the best?

Keti: When starting this project our intention was to bring the best technology, know-how existing out there on the market to Georgia and that’s what we did. Partnering and working with the right companies has been the main reason for the success of our company. [Companies Chirina use in processing include: Bizerba (weighing system), Multivac and Ishida (packing), Meyn (slaughtering/ processing plant) Nij-huis (water cleaning system); Agrotop (building); Geerlofs (refrigeration).]

In hindsight, would you have done anything differently when it comes to processing?

Keti: I believe we had right business model from the beginning. Also, cooperation with the best companies enabled us to minimize the possible errors. Nevertheless, there is always an opportunity to do things better, and more you learn and understand about the sector better you can evaluate processing process, its plusses and minuses and generally the business.

The operation covers a rather large area, 15 square km. Are biosecurity issues a major problem?

Keti: We have implemented ISO22000, HACCP at all of our production facilities. Biosecurity and quality of our products is number one priority for us and thus we are constantly working in this direction.

The right equipment can minimize the potential of human error; was this one of your thoughts in going with Meyn?

Keti: Meyn is one of the best companies in the world dealing with the processing of the poultry products. Quality of Meyn processing equipment, automation of its machinery were the main reasons for choosing Meyn.

Is maintenance an issue in going high-tech?

Keti: For developing the expertise in terms of maintenance we have contracts with the equipment suppliers. Technicians of equipment suppliers are visiting us annually, inspecting all of our equipment and training further our personal. Close cooperation with our partnering organizations has been crucial for proper maintenance.

 

Is it difficult getting qualified processing plant workers?

Keti: Having the right people and talent is the challenge of every organization. Initially most of the team didn’t have any knowledge in poultry growing, processing, feed production and so on. For the purpose of training our people and implementing the latest trends, we signed one year know-how agreement with our Israeli partner Agrotop. Group of professionals gathered by Agotop lived in Georgia for a year and paired with local specialists. This is what enabled us to form the team of qualified professionals.

How many shifts do you have a day?

Keti: We have mainly one shift, but for some positions we have a 24-hour shift. We have special teams devoted to cleaning in all of our factories.

In the UK Campylobacter is a huge concern; in the States, it’s Salmonella. Are these pathogens an issue with you?

Keti: Campylobacter, Salmonella are threats everywhere. For that reason, we built not only factories and farms, but also established a modern veterinary laboratory accredited with ISO 17025 standard where microbiology tests and serology tests are undertaken on the daily basis. We are checking our products and general biosecurity levels regularly, and thus ensuring that our customers get the best quality product.

Consumers can buy chicken at small Chirina street kiosks; is this a typical way of buying poultry in Georgia?

Keti: As it has been already mentioned, our emphasis is to sell fresh meat. Unfortunately, the professional retail sector is still not widely developed in Georgia. Consequently, for selling fresh meat and ensuring the quality of the products we came up with the solution of kiosks. Due to establishment of kiosks and our own retail shops currently fresh meat represents 60 percent of our sales.

You offer chicken mince and chicken sausages – not typical Georgian products. Has it been difficult breaking these two products in the market?

Keti: In terms of further meat processing, so far we haven’t built our own factory. We have been testing the market through outsourced models. We are planning to develop further processing line in the coming year.

There is politics and there is business. Does Georgian/Russian politics get in the way of business?

Keti: Relationship between Georgia and Russia is tensed, parts of Georgia are occupied by Russia. Tensed political situation introduces additional risks to the business, but at the same it is important to note that Georgia as a country represents interesting investment opportunities in different sectors and potential for business development.

 

Source: Big Poultry in Georgia, Velo Mitrovich, Meat Packing Journal, Volume 5, Issue 1 (p66-70). Read here

Upcoming events

Cookie notification

We use cookies to improve your browsing experience. The cookies that are required for using the website are legally allowed. Other cookie settings can be managed below.

more information