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LEARNING CURVE: MIRAMAR TRADING INTERNATIONAL : Skoal-Oriented : Vodka Venture Distills Best of 2 Worlds

October 31, 1995

When the Soviet Union was on the verge of disintegration, Jeff Cohen and Brian Robinson founded Miramar Trading International to import and distribute vodka from Estonia. Five years later, they have learned that having business partners from another culture requires patience and sensitivity, but can be rewarding and profitable. Cohen and Robinson were interviewed by Karen Kaplan. Their comments are combined here.

Both of us are trained as doctors [Brian is a clinical psychologist and Jeff is an oral surgeon] but when Jeff's friends in Finland asked whether he'd be interested in distributing Russian vodka, we were intrigued. We talked about it on the golf course in Monterey and one week later we were on a plane to Tallinn, the capital of Estonia, in the middle of winter.

There was a revolution going on in Russia and so there was a window of opportunity. We spent three days negotiating a contract in Finnish, Estonian, Russian and English. We brought two interpreters with us.

At several points during the negotiations, the Estonians would all get up and leave. It would be literally two or three hours before they'd come back. We didn't think we were getting the contract. So Jeff looked at the head of the factory and said, "We've come 10,000 miles to see you." He opened his briefcase and pulled out some Lakers caps and put them on their heads. Then we all started to trust each other.

The business plan was to sell the product for half the price of Stolichnaya, which is produced at the same factory as our brand, Volganaya. The Estonians were offended that the price could be so low. We had to convince them it was just a marketing scheme. Of course, their factory used to be state-owned, so they had no experience with pricing, marketing or selling their products.

Our first problem was to make sure we got a steady supply of vodka. Within the first year we built our own wing on the facility in Estonia. Then there was a shortage of glass in Russia, so we ended up doing a joint venture with a glass company nearby. The Estonians were surprised that we could have any influence at all on another company.

Building the new wing was our biggest start-up expense. We had to spend some money to open up an office and become legally incorporated. We didn't have to invest much on the vodka because we'd only import what we knew we could sell. Altogether our initial investments totaled a few hundred thousand dollars.

In the beginning it was really hard to get through to our partners in Estonia. Now we can make a direct phone call or fax three or four times a week.

Before you start a business venture, you need to do your homework about the customs in other parts of the world. Don't make the assumption that the way things are done here is the way they're done in other places. You have to be patient and give them time to understand you. Patience is really the key. There were many times in those meetings that we could have left because we thought the Estonians had left the room and were never coming back.

Business is still about relationships with people.

On doing business with a formerly Communist enterprise . . .

"Of course, their factory used to be state-owned, so they had no experience with pricing, marketing or selling their products."

On having business partners from another country . . .

"Before you start a business venture, you need to do your homework about the customs in other parts of the world. Don't make the assumption that the way things are done here is the way they're done in other places."

On the value of patience . . .

"There were many times [during the talks] that we could have left because we thought the Estonians had left the room and were never coming back."

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AT A GLANCE

Company: Miramar Trading International

Owners: Jeff Cohen and Brian Robinson

Description: Importers and distributors of Volganaya vodka from Estonia

Location: Monterey, Calif., plus satellite offices in Los Angeles and Turku, Finland, and storage space in Salinas, Calif.

Size: 10,000 square feet of office and warehouse space

Employees: 15, plus independent brokers around the country

Annual sales: $11 million

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