Report from the workshops of Holding Zagora or how the entire city can benefit along with the business sector

March 29, 2016

Let’s imagine that the city – any city – is a giant, complicated strategy game. It is played on many levels by countless known and unknown characters, as a daily battle with unforeseeable forces, global trends, natural disasters, economic laws and a perpetual shortage of funds. The true heroes in this game – the characters who write the history of their city – are the energetic, visionary and enterprising players who make moves that take them to the next level and precipitate changes that will continue to bear fruit long after the heroes in question have retired under the shade of a quiet green vine canopy.

It is difficult for everyone to win in this game. If we want businesses to win and, with them, their thousands of employees, the employees’ families and, ultimately, the entire city, there isn’t an infinite number of winning combinations. But they do exist.

Let’s act

Now, if we considered the opportunities offered by the JESSICA (Joint European Support for Sustainable Investment in City Areas) initiative and zoomed in on one of the thousands of small points on the map that comprise the big picture, in our case on Holding Zagora OOD, South Industrial Zone, Stara Zagora, we would see before our eyes a complex of industrial buildings, workshops and warehouses older even than our favourite vine canopy. Time has not been kind to them.

“Do you see the metal sheets over the windows of the main workshop? The glass panes are always breaking from the vibrations generated by a water hammer that operates inside. We’ll use part of the funding under JESSICA to replace every single one with panes made of a special polycarbonate,” Vasil Vasilev told us as a way of introduction to the situation. He works as a procurement agent for Preskov AD, one of the biggest Bulgarian companies in the production of hot-forged parts, which has established a reputation on the international market. “What’s more, on the inside, there’s no place without leaks…”

“And when water leaks on machines worth millions of euros, the damage is immense,” Gosho Gochev said, relating a similar story. He works as a procurement agent for mechanical engineering company Hraninvest – Hranmashkomplekt AD, also part of the Holding. “Downtime in such circumstances results in substantial losses. Repairing the roof insulation was simply imperative.”

We also took a close look at a number of engineering workshops with facades that had become dilapidated a long time ago. Behind such walls, it is a real challenge maintaining the right temperature for the machines which, as is well known, are far more demanding and sensitive workers than people. We could also take you on a trip along industrial roads with more craters than the Moon’s surface, but we are sure that would not surprise you. Instead, let’s focus on the new additions to the facility’s grounds.

That’s what’s happening while you’re reading this

“In addition to repairing the roofs, we’ve also resurfaced the inner roads, and – this is what I’m talking about – that forklift just went past us at 30 km/h without giving the driver a bumpy ride,” Slavin Yanakiev said with a smile. He is the CEO of foundry Progres AD, which has made a name for itself on the global market and set a model for Bulgarian iron casting producers. “One more thing, foundry operations are generally very dirty, but we’ve become cleaner than a German foundry. We’ve installed dust filters and heating in many areas, created green spaces and, basically, improved the working conditions.”

Those are just some of the small details of great importance both for the output and for the confidence and image of any company. As well as for the motivation and health of its employees. To them, we can also add the capacity of four new machines, three of which have already been put into operation. “This Doosan machining centre is the most modern machine at Progres. It has expanded the range of our capabilities. We also bought one for gas cutting,” Yanakiev explained.

At the same time, a 25-tonne two-panel four-axis CNC milling machine Litz has for several weeks been hard at work performing jobs for international clients round the clock, in a brand new purpose-built Progres workshop. Within months, another milling machine for tool production, this one with three axes, will arrive in the factory.

Along with the new equipment, 24 new operators have started work at the two companies, and more than 1,000 employees (not counting the machines) working in the production and administrative buildings can boast of a more modern, comfortable and environmentally-friendly workplace. If we look even further in the future, according to long-term forecasts, the renovation will boost the entire region’s economic growth and competitiveness.

Let’s talk numbers

There’s no manager in the world who wouldn’t say an enthusiastic “Yes” to any improvement to the factory environment and working conditions. No manager would turn down an opportunity to enhance the facility’s energy efficiency or frown at the idea of having roofs that don’t leak. Nobody would deny that, while the benefits of a green space among the workshops can’t be assigned a monetary value, such a space is an important asset.

It is indisputable that investment in all of the above areas is necessary. “Still, it’s not urgent enough to do it right away. Road and building renovation always remains on the back burner. Every company is focused on investing directly into increasing production,” Holding Zagora Financial Director Maria Horsikyan said.

“The opportunity created by the JESSICA initiative helped us decide to invest BGN 3.9 million at once in projects concerning five of the companies in the holding. If we had to rely only on bank loans, we would’ve had to space them out over time. Yes, funding under JESSICA is also a form of loan, but the terms are much better and allow us to avoid upsetting the balance in production. The interest rates are tangibly lower than those on the market and don’t change. There are no servicing fees either. The repayment term is also quite long – 10 years – whereas the investment loans our companies normally use are between 5 and 7 years, never more than that. It’s true, there’s fair amount of paperwork to complete and process in relation to these projects, because there’s accountability on many levels, but we’ve received full support from our colleagues at the fund and the bank. And we really do work well together.”