Job Discussion Forums

[maruss]

You are dead right,and this is exactly what I have been warned about-cheating,lying and deception are unfortunately often the norm in Russia where business and money are concerned,which is precisely why I have given up the idea of trying to get any further business from there in my own field of work with incoming tourism etc.-people are simply just not reliable,and at best may tell you what they think YOU want to hear from them,or at worst just cheat you and leave you high and dry!Ask so many Cypriot travel agents who went over there in the early 1990's like I did with every good intention when we heard that a massive new potential market was opening up...Actually,compared to quite a lot of them,I've been very lucky because I didn't invest a lot or lose much-I know personally of people who lost hundreds of thousands of dollars,especially in the 98'financial crash when firms there couldn't get their money from the banks to pay people over here! I could write a book about it and would be pleased to duscuss it more with anyone who is interested,but will summarise it by saying that generally speaking,business in Russia is corrupted.especially in tourism which involves "valuta" or foreign currency,and there are no proper firms without a "krisha" or roof as they call it!Since 1998,large companies control most areas of economic activity and it is virtually impossible for a small foreign firm to penetrate the markets,or find serious partners in any kind of activity,unless you have big money to put up front-and the risk of losing it is ,I would say around 75%!When that happens,there's no fair trading office,or lawyer or courts you can turn to to get compensation as most of them are crooked too!
No wonder so many Russian people are stressed-up and envy me living in a place like Cyprus especially!But having said all that,there are things that I do like about the place,especially my few close and trusted Russian friends and some other things-after almost one year since my last visit,I'm already very nostalgic about it!

Have a good weekend and I'll write again next week-meanwhile"nasdvoroviye!"
Thanks a lot for your advice.
Martin.

[Kent F. Kruhoeffer]

Privyet Martin

I read your comments about doing business in Russia with great interest. You definitely speak from experience.

For those readers who don't know what a "roof" is; Martin is referring to the modern-day Godfathers of Russian business who provide "protection money and muscle" to counter the various extortionists and criminal gangs who prey on Russian and foreign business owners.

It's true; doing business in Russia today is not for the faint-of-heart. There is a tremendous history and culture of corruption, cheating and bribery which permeates almost every aspect of daily life here.

If someone ever publishes a book entitled "Business Ethics in Russia", it will certainly be one of the thinest books ever published.

Having said that, there are, thankfully, some signs of improvement to report, especially since President Putin took over the reigns of power.

Mr. Putin is making serious progress in the fight against these illicit and immoral business practices, but change will be slow, since the cadre of bureaucrats below him is still basically rotten to the core.

Anyway ... Take care, Martin! I do hope you find what you're lookng for.

Warm wishes,
kENt

[Buck Turgidson]

I too thought about starting a business in Russia. I thought of starting my own English school since that is really all I have experience with. Finding a Russian partner familiar with local "businessmen" and cops would be essential. Finding such a person that you could trust would be problematic.

A Russian friend of mine continues to try to persuade me to start an internet introduction service. But I have the impression that this sector has been saturated already.

Buck

[Kent F. Kruhoeffer]

Hi Buck

With the possible exception of the Russian stock market*, I would personally stay clear of any direct investment in Russia today. The risks clearly outweigh the possible benefits. There are just too many examples of investors getting burned.

After Russia joins the WTO, and after the government gets its financial house in order, my opinion on this subject might change. Whether or not that will happen in our lifetime is open for debate.

WarmWishesFromTheMeltingTundra,
kenT

Footnote: *Energy, telecommunications and mining of precious metals ... would be three areas I would invest in today, if I had enough spare cash under the pillow to play with.

[maruss]

I would thoroughly agree with Kent-don't risk your money in trying any business in Russia,except possibly investment on the lines he suggested.
I know of one ex-pat who tried to open a school a couple of years back in a town outside Moscow and after trying for a year,the "registration" couldn't be completed and the lawyer kept demanding more money to comply with "new regulations" which kept changing all the time!When he refused to pay,he was threatened by the mob and warned that if he didn't ,he would never be able to open a school there or anywhere else!What they were demanding was an amount which would have made his business unprofitable-the trouble is that these people know everything about what you are planning to do,how much they estimate you can make etc. before you even start as the whole system is so corrupted that they have access via officials to all the information they need!In the end,he gave up the idea,realising that he was making far more teaching privately than he could get from any business venture,and without paying money to any crooks!As far as I know,he's still there and doing very well-in fact he says he has more work than he can handle,but admittedly he does have very good qualifications and a lot of experience,so he deserves it!
His suggestion to me was that if I am determined enough to come over there, get a flat myself and then try to get an hourly paid deal with one of the big schools,rather than sign a contract with them,this will leave me spare time to do other private lessons,but it will take time for me to become known and find students etc.He reckons I could make at least 2000 u.s. per month that way,but it will take time,hard work and patience!
But I was warned by several other people that it is far more difficult nowadays than it was a few years ago to do things that way,firstly because there are too many people trying it-a glance at the number of teachers advertising for work on the expat.ru site is proof of that-it can also be unreliable when students either don't turn up,don't pay you when they should etc.I was also warned about the security risk of asking unknown people to your home,revealing where you live etc.-also travelling to their place can be risky and time consuming.Although Moscow is probably safer than London and other large cities in the world nowadays,crime is a problem there,and foreigners are at more risk than locals.I've never had any problems anywhere in Russia myself,except for one occasion when I stupidly changed money in the street and lost 100 u.s., but it can happen and when it does,the police are not exactly reknowned for being either helpful or effective!By the way,the new regualtions with registration cards etc. on arrival are apparently partially designed to stop people from working illegally without paying tax etc.,although you can now import and export up to 3000 u.s. without filling in a declaration!

Cheers for now!

Martin.

[Buck Turgidson]

Thanks for your opinions. It may be that teaching privates is for me.

Buck

[Kent F. Kruhoeffer]

Hi Buck

If you come to Russia with a small nest egg (3 or 4K), you can enjoy the summer holiday, maybe pick up a few privates, and then knock on school doors for the Fall semester.

Based on your obvious commitment and desire to succeed, I'm sure you'll find your Russian Nirvana. I have no doubts about that whatsoever.

Just be SURE to get help from a native Russian when arranging the rental of your apartment, so you can avoid those expensive 'expat' places which will charge you an arm, a leg, and your soul.

Regards,
kEnt

PS: I've just renewed my contract for a third year, and I've got 2 weeks of paid summer holiday coming up. If you let me know where you're living, I might just drop by for a cold beer (or 2). Hell, who's counting??

[maruss]

Hi Buck and Kent!
Well said on renting appartments-these agencies in Moscow etc. charge around DOUBLE what the appartment is really worth! You can find a studio there for around 250 to 300,depending on the area,standard etc,as long as it's away from the centre,but the main problem is that contracts made privately are worth nothing legally and if the owner suddenly decides he wants the appartment back at the end of the month,there is really little you can do except find somewhere else!Generally,avoid panel blocks as they are not only stuffy and airless in summer,but tend to have wafer thin walls,meaning that when your neighbour decides he likes acid rock c.d's at midnight,you will be listening too-or if his girlfriend is making passionate responses to his advances(or yours is if you are lucky!)there will be an audience,at least audibly!The other sensible thing of course in any appartment you rent,inless you are ABSOLUTELY SURE who else has keys to it and you trust them,is to change the main lock to the steel outer door(always try to find an appartment that has one fitted!)
Cheers for now!

Martin.