About building a company worth over PLN 3bn

About building a company worth over PLN 3bn, about unsuccessful adventure with Himalayan mountaineering and racing passion, which was born before sixty – tells us Krzysztof Oleksowicz, founder of Inter Cars and one of the richest people in Poland.

Forbes: How did this happen that a graduate of philosophy college took up distribution of automotive spare parts?

Krzysztof Oleksowicz: When I was studying, very often I went abroad to work.  I was used to making money.  When I got back to Poland I could not imagine working somewhere full time, earn 20 dollars  monthly and not having what I was used to have.

At that time, in Poland there was some margin for private entrepreneurs. One could become a truck farmer and dig the ground.  Or a plastic moulder - get an injection moulding machine somewhere and produce simple potties, bowls or plastic baths.  I could also get into motorization, launch a small private garage and repair cars.  I had some experience in that area, as before I had worked in Germany as a mechanic, so I chose this way.  And some time later I started selling used cars, mostly crashed, and I understood that one can earn more money on parts than on the whole cars.

Before that it was really close for you to become a Himalayan mountaineer.

In 1982 I met Wanda Rutkiewicz.  She told me that she was organizing an excursion to K2 and that she needs someone who would drive around Europe and collect climbing equipment. I had all the qualifications: I knew the language; I had a car and international links. This made me a driver of Alpine expeditions and I went seven times from Warsaw to Kathmandu. When at the end of 1985 I was in New Delhi with my colleagues, during one of the evenings they asked me:  „Kris, why do you actually not climb?” I told them:  „Because no one has invited me”. „So you are invited to the sixth mountain in the world”. And that was how I became a member of an expedition to Cho Oyo.

How did that finish?

I gave up during climbing on 7,800 metres above the sea level, as I was completely unprepared.  I had just made a Tatra Mountains course.  That was also my first time with crampons on my feet.  I did not even know what an altitude sickness was.

What happened next?

In 1988 I took part in the expedition to Ritacuba Blanco in Colombia. During the climb a terrible thing happened – I was left alone with dead bodies of my two colleagues, with whom I was trying to get to the top. At that moment I realized that despite being a 30-year old, I still had a mind-set of a child.  I could not imagine that something wrong could happen to me.  Till his death, Jerzy Kukuczka was thinking the same way.

My colleagues tried to talk me into another expedition later.  They wanted to walk onto Nanga Parbat in winter, the peak which has been conquered only this year.  I quitted.  At that time I knew that climbing is like walking on icy rope.  You never know when you might slip.

And was it possible to combine Himalayan mountaineering with running a company?

You can either go for one month in the Himalayas, or run a company. This or that.  When Himalayas came to me, it was the time in Poland which was more favourable for the business.  I would feel sorry to leave behind what I had started here.

What pushed you forward in business?

It was something different at each stage.  In the 90s it was all about buying and selling to make money. When finally we got the same possibilities as our friends from the West, we were driven by unhampered drive forward, possibility of competing. All entrepreneurs cared mostly for the biggest growth rate.  Turnover was the king, and huge margins resulted in huge profits.  The point was to leave the profit in the company, not consume it.  Many entrepreneurs at that time could not hold them back. They consumed, so really they robbed the company of its development.

And then?

In 1998, after the Russian crisis, one had not only to chase the development and profit, but also consider the costs. We started analysing how to control them.  And at the same time, how Inter Cars is ranked in Europe. In Poland we were surely the biggest distributor of automotive spare parts, but in Central Europe we were still a bit too small. So we set a goal. We want to be the number one in Central and Eastern Europe. We developed a strategy which will allow us to reach this goal.

What was it based on?

We created a very flexible franchise system, which is probably our greatest market advantage today.  It works perfectly not only in Poland, but also outside it.  In Central Europe we are running business activities in 14 countries from the Baltic to the Balkans. As a result, our growth in 2015 is in total is higher than the total turnover of the second distributor in Poland.

Which markets are best for Inter Cars?

This which have the upturn.  Central Europe is great, as the fleet of motor vehicles in this region is constantly growing, and the perspective of its growth should be kept on the same level in the next 20 years.  In Western Europe we can observe medium saturation with vehicles, on the level of one vehicle per two citizens.  This is a parameter which the whole Central and Eastern Europe will probably reach, but there is still a long way to go.

In our business the relations are simple: the more cars, the more repairs, the more parts are needed to perform them.  For us the worst market would be Switzerland, where the GDP per capita is so high, that most citizens can afford buying new cars. Because of this the demand for spare parts is much smaller.

As the biggest distributor of automotive spare parts in the country, have you never thought of creating a Polish brand of cars?  This way you could make the dreams of many motorization fans come true.

One should cut ones coat according to ones cloth. Entering any sort of new business would be for Inter Cars, robbing us of what we are doing.  Distribution of spare parts means an incredible demand for capital, just like manufacturing cars.  So I would have to take substantial part from one area to put it into another.  I do not believe that carmaking would bring the same return on capital as selling parts.  It would be something very proud and incredible to consolidate what has left of the Polish motorization industry, but we have no power nor time, and what is more important, no money to realize this.

Can you see a possibility of doing this by any other company than Inter Cars?

There are some extremely niche ideas like new Syrena or Arrinera Hussarya, but creating a Polish car which could sell in large numbers. I see no chance.

And what if someone would try back in the 90s - would it be possible to build a strong Polish brand at that time?

Yes, but only in cooperation with a foreign company. The Czech Republic has a well-developed automotive industry, but they have created it in cooperation with someone.  In Central Europe there is really no make of a car: in Hungary we have Suzuki, in Romania there is no Dacia, but Renault, and in the Czech Republic there is Volkswagen Group.

Why many entrepreneurs – including you – are so keen on motorization and taking part in rallies?

In the first place, because car rallies deliver a huge doze of adrenaline. And my body, since I was a child was used to that. Adrenaline allows killing thinking about excessive risks.

It sounds like rallies had nothing to do with the business.

I suppose they have a lot to in common.  There are brilliant businessmen, who get brilliant ideas, but in order to run a business, they need experience.  The same applies to races.  It is enough to remember how Sébastien Loeb and Sébastien Ogier started their careers. Drivers who have dominated car races in the recent years.  At the beginning they recorded a crash after crash.  Only when they gained experience, they started winning.

You have started racing late, as an experienced man.

I have always dreamt about competing in rallies.  At first there was no money to do that, later no time, as Inter Cars was the most important for me, later when I had time and money, it was not the right age.  But I decided to give it a try.  When if not now?

Did you not have a temptation to give more attention to the company now, when it grows with two-digit pace and reaches over PLN 3bn capitalization?

After 25 years of doing the same, no matter is there is success following it or just a lot of stress, you can be fed up.  No matter how interesting that is.  And distribution of automotive spare parts on such scale is not so passionate it may seem.  But I could not postpone races any more.

How did you start?

In 2008 I was at training with my son.  I took a co-drive with Maciek (Maciej Oleksowicz is a professional driver – edit.) several times. When I told him that one of the curves could be driven in a different way, he told me to prove it and drive myself. We changed places.  I thought I could make it, when I have extensive experience in driving.  On the first curve my car was turned around, the second one made me drive off the track.  The fact that I have covered 1.5 million kilometres in normal road conditions had no influence on my racing driving.

What was your first race like?

The first stage I will remember till the end of my life.  With my co-driver, Maja Szpotańska, we were getting ready to start.  We were waiting for the green light.  Everything was ready, except me - I was sleepy and jittery.  At last, the green light goes on, I release the clutch pedal and... bad luck! Instead of going forward I was moving backwards.  In the stress I had forgotten to select the right gear.  (laugh)

But you were not disheartened.

I imagined that I will not disturb the professionals, so for several races I started as the zero, before the races.  Thanks to this I went through the same tracks and gathered the same experience as a racer.  During my first races I was dream-driving.  I did not realize how fast I was going, was it fast or slow. Only as the time went by I gained control over this.  The stress passed and I was sleeping normally before the races.

Initially I lost around 4 seconds on each kilometre to best drivers, but in the last two years it has been quite well.  Now I am loosing just about a second, sometimes less.  I suppose this is the peak of my possibilities.  Physical limitations associated with my age do not allow me go faster.  Unless I go at 110%.  But then I may not follow the route.

And are sports cars your passion? Do you have your favourite car?

I always had a car to sell.  Almost every car I have ever been driving was finally to be sold.  Only lately I have built myself a sports car – Subaru GT, on the basis of 98 model.

And what do you drive every day?

I have a nice and comfortable audi with all I need.  It is perfect for everyday driving.

Don’t you get a temptation to race on Polish roads?

It has no taste and sense, and also is dangerous.  Anyway since I started racing, I stopped being interested in the fact that somebody is overtaking me or starts faster from the lights.  This world is finished for me; I can see a clear border between the sport and everyday life. In the 90s, very often we saw drivers, who were racing on Polish roads, showing off with possibilities of their cars.  There are still a lot of such people.  I recommend rallies to all of them.  Or go-cart races for the beginning.  It is also a great sport.