One of the first names that comes to mind when talking about electric small appliances in Turkey, Arzum has introduced Turkish coffee culture to the world with the strength of industrialism. By merging traditional values with modern technology, Arzum has turned Turkish cultural products into a recognized brand on the international stage. Murat Kolbaşı explained how Arzum's journey of flavor transformed into a global brand with a cup of coffee.
When it comes to electric small appliances, Arzum is one of the first names that comes to mind, reinterpreting traditional coffee in conjunction with modern machinery and carrying it to tables in nearly 60 countries. Murat Kolbaşı, chairman of the board of Arzum, stated that with the OKKA series launched in 2014, they created a global brand by bringing Turkish coffee together with technology.
Stating that they aim to make Turkish and Ottoman cuisine more visible on the international stage in 2025 with innovative products such as “Thermogusto” and “Arzum OKKA Espresso,” Kolbaşı also announced their goal of expanding their export network in the personal care segment for further growth. Despite the financial challenges brought on by currency fluctuations, he emphasized that they plan to achieve sustainable growth in both domestic and global markets through strict cash flow management, while continuing their mission to transform traditional tastes into global brand value.
In this exclusive interview, we discussed Kolbaşı's insights on Arzum's “flavor journey” and how a cup of coffee has turned into a success story on a global scale.
Let's start with the story of Arzum's foundation. What kind of background do you come from?
We are originally from Konya. In 1930, we moved to Adana due to the world crisis. In the 1960s, we moved from Adana to Istanbul. In Istanbul, we started our trade life by establishing a company called “Güney İthalat” in Eminönü. We are actually a family with merchant roots. The three brothers, Kazım, Kemal, and İbrahim Kolbaşı, founded the foundations of Arzum. On July 6, 1966, the Arzum brand was born with the “wish” of the three brothers. At that time, we were the representatives of a German brand in Turkey. However, the German company did not give us the right to produce in Turkey. This led us to create our own brand. In a sense, the poor landlord made us homeowners.
How old were you at that time?
I was born in November 1966. So the Arzum brand is a few months older than me. I went to America for my master’s degree in 1988, but returned to Turkey due to my father's death. Since that day, I started to work in the company under the guidance of my uncles. During that period, we had a factory called Balkan Plastik. This factory produced sub-industry products for international white goods brands. It still continues production with 24 plastic injection machines.
How did your branding process develop?
Since 1993, we have intensified our television advertisements. From that moment, Arzum gained a more professional brand identity and became much more prominent. We worked with names like Şevval Sam and collaborated with creative agencies like Ali Taran. The communication strategies of Betül Mardin greatly contributed to us. If I am going to do a job today, I would prefer to work with the best in the market, an expert in the subject. Therefore, professional people might not be cheap, but the service and outcome you receive can be very different.
What steps have you taken for sustainability in family businesses?
While managing the brand, you also need to manage the family and company correctly. One of the most important issues for family businesses is sustainability. For this, I participated in organization meetings aimed at family businesses operating in Switzerland. Later, we established the Turkey Family Business Association (TAİDER) in Turkey. We created this association by gathering with 40 different families.
How did the process of foreign fund partnership for the company develop?
We saw that having a foreign fund or investor entering family businesses is very valuable for the sustainability of companies in the international arena. For this reason, in 2008, we sold 49% of Arzum to a fund called Ashmore in England. As the representatives of the second generation of the company founded by the three brothers, on that day, alongside the first generation still alive, we equally diluted our shares, keeping 51% while making Ashmore a partner. In later years, Ashmore sold its shares to another firm, Mediterra Capital Partners. We worked together with them for about seven years.
How did Arzum's IPO process unfold?
In December 2020, Mediterra sold its shares on the stock exchange. Thus, 49% of Arzum became a publicly traded company.
How did Arzum contribute to Turkish coffee culture?
Since 2014, we have been advocating for Turkish coffee. Especially with the Arzum OKKA product, we brought Turkish coffee to a different dimension in Turkey. For the first time in the world, we launched a machine that can serve ground coffee directly into the cup under the name Arzum OKKA in October 2014.
How did Arzum OKKA come about?
Turkish coffee is a very special beverage due to its brewing method. However, it lacked mechanization. In 2014, we launched Arzum OKKA. This product offers both slow cooking and fast brewing options for coffee and serves coffee directly into the cup. Without losing foam, without the hassle of pouring from the cezve... This was a first in the world.
What is the current status of the Arzum OKKA series?
Currently, there are more than 10 different products in the Arzum OKKA series. This year marks the 11th anniversary of our launch in Turkey and the 10th anniversary of our international launch.
Are there any other innovations in your product range?
In the past year, we added an espresso machine next to the Arzum OKKA Turkish coffee machines. Thus, we are producing machines that can prepare both Turkish coffee and different types of coffee in the coffee market. Currently, we have nearly 300 different products, and we can be found in nearly 60 countries. Arzum has turned into an international brand with its own companies in countries such as the USA, Germany, Dubai, the People’s Republic of China, and Hong Kong.
What are Arzum's global brand goals?
Our objective is to carry our brand awareness and perception from Turkey to the international arena. Especially in the Middle East market, we have a very strong perception with Arzum OKKA. In Germany and EU countries, thanks to our Turkish citizens there, our recognition is quite high. Our product sales in the USA are doing very well. In Asia, particularly in Indonesia, China, and Hong Kong, we want to enhance our brand by making collaborations.
What strategy have you followed to elevate the perception of the brand?
For a brand to have a strong perception on the international stage, it needs to own a particular subject. There is always ownership in the success stories of globally recognized brands. When we look at it from Turkey's perspective, we thought the cultural values like Turkish coffee and Turkish delight are important. Focusing on a population of about 750 million, they have been spread from the Ottoman culture to the world. In this community, we saw that the cooking culture of Turkish coffee is known but hasn’t been combined with technology.
What developments have occurred regarding coffee machines in Turkey?
In Turkey, there used to be coffee pots that exploded and burst; when you put a metal spoon in, it would blow a fuse, shocking the user. In 2002, we developed the first non-explosive, non-bursting coffee pot, which brought us great success. In 2004, an important Turkish brand released a product named Telve. However, both our 2002 pot and the Telve product required manual intervention to brew and serve coffee. In 2014, we made a breakthrough with Arzum OKKA. We developed a machine that is able to brew ground coffee in a compartment, either slowly or quickly and serve directly into one or two cups. Thus, we solved the problem of transferring coffee to the cup without losing its foam with a fully automatic system.
What is the international significance of Arzum OKKA?
While Arzum OKKA may not be the world’s first Turkish coffee machine in 2014, it was the first Turkish brand to enter the market with a machine that could brew ground coffee and serve it directly into the cup.
We have many hot beverages, could we introduce them to the world, what do you think?
We are the ones who introduced Turkish coffee to the world. There are many beverages unique to us, such as Turkish salep, Turkish tea, boza, şalgam, and alcoholic drinks. I believe these do not have the places they deserve globally. I have never seen a foreigner drink salep and not want to drink it again afterwards. As a child, we drank milky Turkish coffee. However, we cannot find it on the menus today. We are striving for its return.
In which areas do you excel in domestic and foreign markets?
In the domestic market, we are a strong brand in kitchen groups (food preparation, tea-coffee beverage groups, and cooking products). In the foreign market, we are particularly known for Turkish coffee machines. We also have leadership in floor cleaning products (vacuum cleaners), personal care products (hair dryers, personal care devices), and in the mid-range ironing group.
You are the first company that comes to mind when it comes to electric small appliances in Turkey. How has 2024 been for you, and what are your expectations for 2025?
2024 has been a difficult year, especially due to interest rate hikes. We focused on products that meet the public's needs in the domestic market. We tried to increase our export weight. In 2025, our priority will also be to increase exports with new products.
As one of the leading brands in Turkey's small appliance industry, we will continue to develop our products in the kitchen group in 2025. Within the framework of our Thermogusto product, which we launched in the first half of 2024, we will focus more on Turkish and Ottoman cuisine, aiming to enhance the recognition of recently highlighted Turkish culinary culture. Speaking of the kitchen, in our coffee culture that we have addressed with the ‘Arzum OKKA’ product family in the last 10 years, we will also embrace world coffees alongside our Turkish coffee under the Arzum OKKA brand. To this end, we took a step in the last quarter of 2024 by introducing our ‘Arzum OKKA Espresso’ series to our users. Additionally, we will continue to make strides by expanding our range of personal care products with our ‘GırGır’ brand, in which we are strong in the market. In this period, exports have been the most challenging part due to the exchange rate.
Access to finance has become difficult under current conditions. How did you manage this process?
Financing costs have been very high. Therefore, it is important to manage buying and selling terms very well, work with minimum stock, and never let cash flow break. I believe that during this period, one should focus on cash flow rather than the company’s profit-loss.
What are your views on Turkey's production power?
Turkey is one of the largest manufacturing countries in western Europe and Asia. However, we need to emphasize creating our own brand more. Contract manufacturing is a good start, but we should enhance the added value of exports by growing our own brands.
Who is Murat Kolbaşı?
Murat Kolbaşı, born in 1966 in Istanbul, graduated from Marmara University, Department of Business Administration. Having worked at Arzum since 1988, Kolbaşı has been serving as the Chairman of the Board since 2008. He also holds positions in many civil society organizations, such as DEIK, TUSIAD, MUSIAD, Turkish Coffee Association, and TAİDER. Kolbaşı is the father of two sons.
Not only did you produce products, but you also engaged in cultural works related to Turkish coffee, didn’t you?
Yes, we established the Turkish Coffee Culture and Research Association. We applied to UNESCO in 2013, and on December 5, 2013, Turkish coffee was registered as Turkey’s “Intangible Cultural Heritage.” This is the first approval ever granted by UNESCO for a beverage in history. In our branding journey, while coming into the international arena, we aimed to be a competing brand that attracts attention with its competitive price. For this reason, we have focused heavily on Turkish coffee. The importance of this was that we succeeded in establishing that Turkish coffee is a ritual, well-known globally, and to put an end to the discussions about where it belongs with UNESCO’s acceptance. We declared December 5 as World Turkish Coffee Day and we celebrate it every year with our representations abroad, our embassies, and the Yunus Emre Institute. With this, we aim to raise awareness about Turkish coffee. We aim to ensure that Turkish coffee is listed on coffee chain menus by collaborating with international coffee chains. In this context, we are working to market our Turkish coffee machines that can make milk or different alternatives and our hot beverage preparation machines and espresso machines to the world.
Translated by Artificial Intelligence
