Lutner SPb. Ltd.
Mastering the unique challenges of serving customers
throughout Russia’s vast 6.5 million square miles
Stretching from the Baltic Sea on one end to the Chinese border and the Pacific Ocean on the other, the Russian Federation covers nine time zones, 6.5 million square miles, and an immense range of geography and culture. For the music products industry, St. Petersburg-based Lutner SPb Ltd. has the task of covering all of it. Founded in 1999, Lutner emerged in a near vacuum for Western music brands, which were scarce under Soviet rule and further disrupted by economic turmoil. Yet Lutner’s founders realized that with its rich musical tradition and affinity for high-quality instruments, the Russian market held enormous potential. Fueled by pent-up demand, the wholesaler would build up a cache of international brands including Hohner, Rico, Paiste, Pro-Mark, Vandoren, Evans, Hiwatt, Strunal, D’Addario, Elixir, Orla and Sonor. Lutner now works with more than 500 distributors and hundreds more retailers, along with music schools, institutions, and cultural committees across Russia, Kazakhstan, and Belarus.
Lutner’s introduction to the Russian music scene, at the very end of the 20th century, was a moment of both chaos and opportunity. A year earlier, Russia had been hit by a financial crisis in which its stock, bond and currency markets collapsed and the Russian government defaulted on its debt. Within the music market, many distributors and retailers shut down, leaving dramatic shortages of most every kind of product. Into that climate, a group of music enthusiasts emerged to found Lutner SPb Ltd. From its base in St. Petersburg, the new company initially served dealers in the northwest region of Russia before extending its reach across the Russian Federation. Lutner now deals in virtually every segment of music and audio gear, from fretted instruments to orchestral products, percussion, keyboards, and more. Lutner CEO Sergey Antonov heads up a management team that also includes Sales Manager Andrey Dubovoy and Logistics Manager Igor Zadneev.
Today, serving retailers from Moscow to Vladivostok still takes a special mastery of regulations and logistics. Built from the ground up to serve the Eurasian Economic Community—a trade alliance comprising Belarus, Kazakhstan, and Russia—Lutner is uniquely well versed in the nuts and bolts of its regulations. In addition, the company maintains close ties to the region’s musicians’ groups, directly incorporating their needs into its business plan.
Shipping and travel considerations also demand an in-depth understanding of the territory. Depending on the infrastructure in a given dealer’s area, goods may need to be delivered by road, rail, air, or sea—or some combination thereof. Although conditions have improved since Lutner’s founding 15 years ago, shipping to some hard-to-reach dealers still requires complex routing and months in transit
While local delays can be unavoidable, Lutner has fine-tuned its own systems so products are always in stock and ready to ship. Skilled staffers check each shipment to see that it contains not only the ordered goods but all required documents, certificates, and translated manuals. The growth of the internet, light-years from what it was in the Russia of 1999, has also greased the operation’s skids. In collaboration with its suppliers, the Lutner team has translated websites for each of its partner brands into Russian. A variety of cutting-edge banking products have also been employed to meet dealers’ requirements. In one of its more recent developments, similar to a drop-ship program, the company has instituted software allowing its dealers to sell from Lutner’s entire stock. The wholesaler reports that sales for participating retailers have grown substantially as a result.
For its own part, Lutner is riding a steady upward trajectory, with sales averaging a 20% annual increase. Founded in the wake of an economic crisis, the wholesaler has taken a deft approach to the world’s more recent financial upheavals. As companies shuffle their supply chains in search of greater efficiency, Lutner has only attracted new partners. Ranked as one of St. Petersburg’s 50 fastest-growing businesses, the company also earned top honors this year in Russia’s National Business Rating initiative.
Subscribe to The Music Trades today!