In fact, there are only 52 of them in Turkey. But if the calculations hold true, another eight will join the “billion dollar companies” league in 2008 and a further 16 over the next five years. These 24 candidate companies will each join the “billion dollar companies” club at different dates. But their shared common characteristics is that they are focused on their goal. Some of them are investing millions of dollars to achieve this goal, others are increasing capacity. Some prefer to grow organically, while this is not enough for others who are looking for opportunities for inorganic growth. Whatever the method, the target is the same, crossing the “psychological threshold”.
“A billion dollars makes a very important point because of how it is perceived. The figure makes a very straightforward, global statement and increases a company’s reputation. The value we have demonstrated is important from the perspective of clearly stating our market share and our focus on the issue.”
This evaluation belongs to Index Group President Erol Bilecik and explains very well the importance to companies of “one billion dollars” in turnover.
In fact there are several psychological barriers that companies set themselves, such as YTL 1 million, US$1 million and €1 million. The most popular of these psychological boundaries is overcoming the “one billion dollar” boundary. Several companies in Turkey have today set themselves the target of crossing this threshold.
It is not just in Turkey, being described as a billion dollar company gives a company considerable prestige globally. There is no doubt that companies which cross this threshold attract attention in the international arena. Companies which have a turnover of one billion dollars also enjoy financial advantages. These companies have high credibility and do not experience difficulties in finding financial resources.
Moreover, these companies play a more effective role in areas such as competition. In addition, these companies’ market value increases. Indeed, reaching a turnover of one billion dollars guarantees being included amongst the 50 leading companies under Turkish conditions.
The New Members Of The Club
In fact, there are not many companies in Turkey which can be described as being “one billion dollars”. Taking as a base the turnovers of 2006 in the 2007 Capital 500 survey, Tupraş ranks first in the champions league with turnover of US$14 billion. PO comes second with US$9.6 billion. There are 34 companies with turnover of US$1-5 billion. That means that there are 36 companies which can be described as billion dollar companies.
There were 46 companies which had turnover of US$500-999 million in 2007, and were thus candidates to enter the one billion dollar league. 16 of these 46 companies announced that their turnover in 2007 was over US$1 billion.
One of these was the Index Group, which had turnover of US$1 billion in 2007. Abalıoüğu, which crossed the threshold with turnover of US$1.047 billion in 2007, is targeting turnover of US$1.2 billion by the end of this year. Abalıoüğu Holding Executive Board Vice Chairman Oğuz Abalıoüğu says: “We are planning to realize this through increasing capacity at our existing plants, producing new products and making investments in factories for new markets.”
Focused On The Target
At the end of 2007, there were 52 companies with annual turnover of over US$1 billion.
But this figure is expected to rise still further in the next five years. Our research shows that 24 companies are focusing on achieving the target of US$1 billion in turnover. Eight of these plan to reach the target in 2008, namely Bizim Toplu Gıda, Borçelik, Boyner, Er-Bakır, Kaptan Demir Delik, Kordsa, Teknosa and Temsa.
Hürriyet Gazetecilik, Netcell and Vatan Bilgisayar will cross this psychological threshold in 2009 and six more in 2010. The other six companies have set themselves the target of achieving this goal in 2011 or later.