Don Giulio and the Food Industry in Times of Crisis

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It was a tough winter for Giulio (44), owner of the Italian delicacy shops ‘Don Giulio’ and restaurant La Scarpetta. At the beginning of the Ukrainian crisis, in the end of 2013, Giulio opened his first shop on the renovated and scenic Pokrovka Street selling Italian cured-meat, a wide selection of cheese, home-made desserts, pasta’s and other delicacies. Since then relations between Russia and the West became worse by the day resulting finally – after Western sanctions – in an embargo introduced by Russia against agricultural products from the EU, Norway, the VS, Canada and Australia.

The import ban on meat, dairy products and fruit and vegetables directly influenced Giulio’s business since Grana Padano (Italian cheeses) and cured imported meats are his specialties. But economic uncertainty did not stop him expanding his business. On the contrary, it forced Giulio to realize his business plans more quickly. In autumn last year, just after the introduction of the embargo, he opened a second shop in Moscow. In December, even whilst the rouble plummeted to a historic low against the Euro, he opened La Scarpetta followed by a third shop on Pyatnitskaya Street in February. To survive, this Italian diversified his suppliers, and he is now not dependent on Italian products made in Italy, he says. Long before anyone could guess that relations between Russia and Europe would become so strained, let alone that there would be an outright ban on imports, Giulio, who has already lived 12 years in Russia, started to devise methods of producing meat and cheese according to Italian methods and recipes in Russia. With an Italian friend, he started production of products prepared in the way that he wanted on a farm in the Tver region. Last autumn, Giulio travelled all the way to Chechnya to buy some buffalo for the farm in order to make mozzarella di buffalo. “Russia’s decision to ban Western products forced us to speed up development of the farm. It takes a lot of time and effort to make cheese and meat that really tastes like it does in Italy. Certain cheeses need to mature for one or two years before they are ready for sale. Therefore we were not immediately ready to sell stuff made at the farm,” explains Giulio. He believes it is possible to produce cheese and meat that is as good as their Italian counterparts as long as you know how to make it.

Don Giulio

Don Giulio

Some people say the import ban stimulates Russia’s economy however Giulio does not think so. “An embargo is never good for a country. As a result of the food ban many Russian companies have started to produce typical import products such as cheese. Russia has enough resources to make her own products. However, it is not all about money. The result will not be long-lasting if the production process is not embedded in a culture.”

Not everyone in Moscow is sanction-proof like Giulio. “Italian restaurants are going through difficult times at the moment,” he says. “Of course my colleagues suffer because of the embargo and devaluation of the rouble, however, it does not mean they will perish. They find solutions, for example they change their menu. Why should an Italian menu always look the same?”

While Giulio has expanded his business with three shops and a restaurant in the centre of Moscow, people are spending less. “We try to keep our prices as low as possible and we are going to introduce a card loyalty system which enables clients to get attractive discounts.” Actually, the dramatic fall of the rouble in December helped the Italian delicacy shops to survive the winter, Giulio continues ironically. Because of the December devaluation, they sold fewer products than expected and had enough Italian products which they had imported before the embargo to sell until the summer. “Our stock is not eternal but I expect when our supply of import products has finished, the products made in Russia will be ready for sale.” This summer many of the meat delicacies made at the farm in Tver region will make their debut in Giulio’s shops. He is already selling dairy products according to Italian recipes but made in Russia.

Despite the crisis, Giulio believes that Muscovites and foreigners will keep coming to his shops and restaurant: “Moscow is a city with many ‘gourmands’. They appreciate good food and understand that quality can’t be cheap because it takes time to produce it.” Giulio does not think the crisis will make many Italians leave Moscow. “Many Italians who live here really do love Russia and they will stay even in difficult times like this.” Italians love food, and are resourceful: “Many colleagues are experimenting with producing their own products such as salami in Russia. Everyone has to invent something and find a way to survive.” This does not mean that they all have their own farm like Giulio does. “Some of my colleagues have their own factory, others have their own laboratory.” Giulio hopes the embargo will be lifted soon, although this will not necessarily make things easier. He explained: “as long as the rouble stays weak, import of Italian products will be expensive. It is difficult to keep prices as low as we would like but by carefully thinking over what we purchase, and by buying wholesale, we succeed quite well. I think you pay less for our Minestrone soup in Moscow, than you would do in Italy!”