The principal indication of the power that companies possess is the ecosystems they create. Today many very successful companies grow together with their ecosystems and increase the added value they create. Wal-Mart, which employs over one million people and works thousands of suppliers all over the world, is the most successful global example of this type in the world. When we look at Turkey we see enormous ecosystems behind the powerful companies of sectors, such as Arçelik, Vestel, Sütaş and Migros,.
Wal-Mart of the US, which is the largest retailer in the world, sold US $18 billion worth of Chinese goods in 2004 and the Chinese said: “If Wal-Mart was a country, it would have surpassed Russia and been China’s eight largest trading partner.
The management consultant Charles Fishman says: “Turkey is the best performing developing country and has a population of 73 million and national income of US $343 billion. In 2006 Wal-Mart employed 1.8 million personnel and had a turnover of US $312.4 billion.” Then he asks the question: “So, what is it which makes Wal-Mart so big?”
The main reason for Wal-Mart’s success, which to date has been the subject of many books and lessons and every aspect of which has been studied by marketing and management experts, is that it is based on a powerful ecosystem,.
Charles Fishman is the author of the book ‘The Wal-Mart Effect: How the World's Most Powerful Company Really Works - And How It Is Transforming the American Economy.’ He says: “Wal-Mart, which employs over one million people and works with thousands of suppliers all over the world, is a giant ecosystem. All over the world thousands of suppliers produce products for Wal-Mart’s 8,000 stores. This ecosystem tries to achieve the never-ending goal of always being cheaper. This huge volume and the ecosystem always striving to be cheaper is what feeds Wal-Mart.”
Charles Fishman believes that it is a mistake to see Wal-Mart merely as a retailer. He explains the reason for this by saying: “Because it is a true ecosystem”. Wal-Mart is perhaps the best example of how a company can be defined as an ecosystem. But today when we look at many companies which are the leaders of their sectors, we see that they manage large ecosystems. The armies of personnel the leading companies employ, their suppliers and the other companies which provide services to the main brands, mean that they create massive added value. The situation works in the same way in Turkey. When companies grow, their ecosystems expand.
1.1 Million People Work For 9 Brands
Arçelik is one of the most important flagships of Turkish industry. Arçelik products are used in 17 million households in Turkey and 75 million around the world. The company has eight different production plants, 13 companies operating abroad and 9 brands. Last year Arçelik had a consolidated turnover of €3.9 billion, and provided products and services to consumers in more than 100 countries on five continents.
Today Arçelik has 4,500 domestic authorized distributors and 540 service points. Its brand creates a total business volume of €2.7 billion in more than 100 countries. Arçelik’s strength abroad is growing every day. The company’s solo products account for a market share of 7 percent of total sales in Europe, in brand sales it has a market share of 5 percent. In Lithuania it has a market share of nearly 20 percent.
Having such a huge volume means that Arçelik makes a very significant contribution to employment in Turkey. More than 15,000 people work at Arçelik. But the number does not stop there. Arçelik General Manager Gündüz Özdemir says that when one adds together the people who work both directly and indirectly for the company the figure reaches 1.1 million. Özdemir says that the state that has been reached today underlines the importance of the ecosystem and he adds: “One of the greatest strengths which has carried us to this point is our successful management of the value chain stretching from production to the distribution network and after sales services.”
Arçelik has set itself the short term goal of becoming one of the 10 most popular brands in the world in its own sector, and its targets once this has been achieved include successfully expanding its ecosystem.
Ülker’s Big Ecosystem!
Ülker ranks amongst the richest companies in Turkey’s ecosystem, The company operates with a complete ecosystem rationale. There are a total of 12 companies in the Ülker Foodstuffs Group, operating in various fields from vegetable oils, to dairy products, marketing and distribution. These companies provide services both to Ülker and to companies outside the group. For example, the milk and dairy products produced by Ak Gıda are both used in Ülker brand products and sold to the consumer under the Ak brand.
Teközel, which is another of the group’s companies, manufactures and sells special brand products. Suppliers have an important place in the ecosystem. The Ülker Foodstuffs Group works with 40,000 suppliers. Ülker Foodstuffs Group President Mehmet Tütüncü says that in 2006 the total business volume created with their suppliers reached YTL 850 million. Tütüncü says: “The total number of people employed by our suppliers has reached 98,000.”
In 2006 the Ülker Foodstuffs Group had net sales of YTL 2.9 billion. The number of people working in the group is 2,526. As a result, the group and its suppliers together provide a living to over 100,000 people.