Bloomberg-Nurettin Eroğlu Konuşması

Thank you. Before that, I want to emphasize the importance of awards. They create competition and motivation. You aim to surpass yourself next year. The ready-to-wear sector has a serious history in Turkey—50 years, but gained momentum in the last 30. It is Turkey's top exporting sector; although automotive appears first, automotive has assembly content. Ready-to-wear is fully domestic production. In terms of employment and spreading across Turkey, it has great advantage with high local content ratio. Looking over the years, production was initially concentrated in the Marmara region. Between early 2000s and 2008, due to exchange rates, there were significant impacts. We took that opportunity to move production to Anatolia. For example, our factory was in Çorlu and Avcılar; now we cannot produce in Avcılar. We invested in Aksaray, our hometown, where we currently employ 1,500 and will increase to 2,500. Other players spread to Urfa, Malatya, Anatolia, thus increasing employment in Anatolia. The sector's biggest advantage is that it is labor-intensive and provides jobs in Anatolia. For instance, in Aksaray, with 1,500 employees, considering services and meals, we add significant value. This will develop further; ready-to-wear and textiles will spread from Marmara to Anatolia. We have serious projects; Aksaray is in the center of Turkey, we manage logistics, cutting, and coordination there and develop with partners in the east. Also, beyond producing for brands, we now create our own brands. At Eroğlu Holding, we have three brands: Colins, L, and newly added Max. We are both producers and own brands with stores abroad.

We have two sides. As Turkey, we produce for high-value brands—foreign brands that source here. We strengthen this by addressing unemployment in Anatolia and lowering costs with state support. This growth is a clear sign. Secondly, we produce for the world's big brands, and we also export our own brands to all countries under our own name. Currently, we have 26 stores in Russia, 100 in Ukraine. Combined, about 30% of our Colins and Max stores are outside Turkey; we have nearly 1,000 stores. Regarding the Russia situation, there were political tensions due to the Syria issue, but trade continued. In the last three months there has been no problem; we can send and sell our products. I think mixing trade and politics is wrong. The Turkish government follows a proper policy. The Russians were upset about the downed plane, and they mixed political and trade issues, but it has calmed down. There is no serious problem now. Design is crucial. We have around 400 designers, which is a high value-add. Without design, we cannot compete with cheap production from the Far East or Africa. We must sell designed, high-value products. Currently, our per-kilo export value has gone from $3 to $24, but we need to reach $55-60, like Italy. We will achieve this through design, high-value products, and brands. We have a promotion campaign, 'Discover the Label', starting in Germany this year, with high-profile events possibly attended by our President or Prime Minister and the German Chancellor. The perception of Turkish products is already high; people pay more for Made in Turkey because they trust quality. Combining this with design will increase interest in Turkish brands. Opening a store abroad increases export by at least $1 million. As the number of stores grows, these figures will rise faster.

We divide the work into two. First, we are producing for high-value brands that source in Turkey, and we are moving to Anatolia to reduce costs and unemployment, which is a sign of sector growth. Second, we produce for the world's big brands and also export our own brands. As I said, we have 26 stores in Russia, 100 in Ukraine. About 30% of our stores are abroad. Regarding Russia, there were political issues from the Syria crisis and the downed plane, but trade continued. In recent months it has normalized. I believe Turkey and Russia need each other, and relations will improve. For new markets, we are working on further penetrating existing markets and also starting a major promotion campaign 'Discover the Label' in Germany first, then other countries. This will boost the perception of Turkish brands.

I say something very important. Twenty or thirty years ago, we were compared to other countries in ready-to-wear; now those countries don't even produce. We produce and supply world brands. In the next 20 years, our brands will be leaders in ready-to-wear. Even in Europe, the costs of having a central office are high—we know from Max in the Netherlands. Turkey is becoming a fashion center, creating brands, and Istanbul becoming a fashion city. The state is supporting this. In 20 years, we will have very important brands—Colins is leading the branding process. The synergy of having both production and brand gives us an advantage. If a brand is not ours, they look at price and may go elsewhere. But with our own brand and production, we have a great advantage.