Nowadays, the life of an average city dweller is shaped in one way or another around three centers: home, work and social infrastructure. If they are located within the locality where a person lives, then the city can already be considered self-sufficient. And if everything is more or less clear with this conditional triangle in big cities, then the current situation in the suburbs, where a large number of citizens are actively migrating to permanent residence, needs a more detailed analysis from the point of view of economic indicators.
We have already talked about the reasons and peculiarities of migration processes in modern large cities and suburbs of Ukraine in the article "City vs village. Gentle urbanization on the example of the Vlasne Misto project". What and how makes people balance between them and what exactly motivates urbanites to move to the suburbs and vice versa? Economic development can be called one of the key criteria. But if, as a rule, they go to megacities for opportunities and a better level of wages, then they move to the suburbs, taking into account completely different benefits: proximity to nature, a comfortable and ecological life, but not for money.
The Vlasne Misto project envisages 166 square meters. m of commercial space on the first floors in a block building with different formats: from 500 to 41 square meters. m. Visualization provided by the press service of Vlasne Misto
Terms and conditions and support
Today, the development of the local economy, improvement of the business climate, self-employment and entrepreneurship is an ambitious goal for any city and settlement, especially one located near a metropolis. Forming economic clusters, offering convenient living conditions near the place of work is a kind of marketing of the city, which brings not only financial benefits to the community, but also adds status. What are the possibilities of organizing one's own business at the place of residence in the suburbs? And what options for conducting business can be offered by a community with a population of 30 thousand people - for example, the village of Dmytrivka, located in the Kyiv region?
"There are many advantages to opening a business close to home," says company CEO Vlasne Misto Yaroslav Korniachenko. - Of the obvious ones, it is time saving. But the most important thing is awareness and a sense of the "portrait" of your target audience: preferences, financial capabilities, values, needs, gender statistics, knowledge of local features. I would also add here the ease of promotion, because in this case "word of mouth" works among the neighbors. And as you know, this method of conveying information has the highest percentage of trust on the part of the potential consumer.
Yaroslav Korniachenko, CEO of Vlasne Misto. Photo: Yuriy Ferendovych
As for the minuses, I don't see them in this case, because the success of any project depends primarily on the organizational abilities of the owner, the perspective of the project idea, the team, quick response to the needs of the market, the ability to quickly transform and love for one's business," shares Yaroslav .
According to the idea of the authors of the Vlasne Misto project, in addition to all the advantages of working at home, each business cell may have great opportunities in the future. The company offers business partners a fixed lease contract for 10 years and a constant cost of service payments and energy resources for a period of up to 5 years, as well as cheap logistics due to the presence of its own hubs and various services or products. Also, according to the management of Vlasne Misto, every business can count on a loyal target audience with gradual growth, which will enable businesses to grow and scale. And there is room for expansion, because the project provides for 166 m2 of commercial space on the first floors in a block building of various formats: from 41 to 134 m2.
The market area, which occupies 42 square meters. m, is the heart of the socio-cultural and business life of Vlasne Misto. The visualization shows a fragment of the central part of the master plan of Vlasne Misto. Visualization provided by the press service of Vlasne Misto
Of course, modern cities pay more and more attention not only to physical infrastructure, but also to the development of human capital, the formation of a business environment, the stimulation of entrepreneurship and the improvement of the investment climate. In large cities, this process usually occurs naturally. Small cities, on the other hand, must be proactive, always have strategies, plans and tools for their implementation in advance, in order to form a self-sufficient economy. But small towns or villages have their advantages: limited competition, because there are many times fewer entrepreneurs and there is a good chance to occupy an empty niche.
"There are many advantages to starting a business close to home. Of the obvious ones, it is saving time, but the most important thing is awareness and a sense of the “portrait” of your target audience,” — Yaroslav Korniyachenko
Out-of-the-box for local business
When starting one's own business, a person faces a process that has many unknowns. The profitability of any area depends on the business model, chosen location, positioning, participation of the business owner in the process, communication with clients, optimization of costs, expansion of the client base due to the delivery system or unification of certain services, etc.
To help residents minimize risks and to rationally use resources spent at the stage of starting their own business, Vlasne Misto has provided a support program - Vlasne Business. Within its framework, a local business support center Vlasne CEO club will also be introduced, which will encourage budding entrepreneurs to develop by organizing their training, introducing meetings and forums for sharing experience and improving the culture of knowledge.
"Today, we are the first project in Ukraine that has developed such a special program on the territory of its own infrastructure. Vlasne Business is an individual proposal for realizing any business dream close to home. We will support the launch of a business on the territory of Vlasne Misto, help take into account the specifics of the area, help with the selection of premises and registration of a long-term lease, provide analytics and access to big-data tools for effective communication with potential clients; thus, many risks are eliminated, and the period from the idea to the start will be significantly reduced," says Yaroslav Korniyachenko.
Market square. Visualization provided by the press service of Vlasne Misto
The local Vlasne Business program is designed to help representatives of small and medium-sized businesses in starting and developing their business within the cluster. There will be a set of local programs and special offers for each of the areas, among them are the development of an HR strategy, special tariffs for electricity and logistics, a local delivery system and ordering of goods and services through the management company, an order placement service at one of the enterprises (internal concierge service for business) etc. Gradually, from small to large businesses, it will also become possible to obtain GO certificates for the use of green energy in their own production.
The program will be available in two main directions — Vlasne Business and Vlasne Business Pro. Yaroslav Korniyachenko explains their features in more detail: "Vlasne Business is conditionally ready-made solutions in the areas of cluster infrastructure in various industries, as well as, if necessary, the development of an individual business model by our business development team.
If you break down the actions into steps, it will happen like this. Do you want to open a bakery? You can make a request to our management company, the business consulting team will hold a basic meeting with you, after receiving the technical task, we will form proposals or offer an already formed business model, action plan, design standard, financial indicators, life cycles of the institution, etc.
The Vlasne Business Pro program will be of interest to owners of small factories or those who want to build a retail network, introduce a manufactory or craft workshop in the city. It is worth noting that workshop premises are set aside for commercial production, and all local manufacturers will receive certain privileges in the placement of their trade networks or sales points.
A shopping area arcade with shops and pavilions with an area of 7400 square meters will be located on Rynkova Square. m. Visualization provided by the press service of Vlasne Misto
For their part, the owners also note that Vlasne Misto as a cluster is ready to invest in the development of innovative enterprises. The cooperation model will be based on detailed analytics from the management company and the investment fund. All indicators will be studied: the market, understanding the efficiency of innovations for the development of the cluster.
"We give value guarantees for a part of business expenses, which makes it possible to predict a sustainable financial model. The cost of a square meter in rent is fixed for a long time, and if it is the construction of a new direction, then its cost will be lower than the market value, on average by 10–12%. There is a cluster tariff for service maintenance of the square and the surrounding area. The cost of electricity is fixed at the level of the green tariff for at least 5 years with the constant increase of the standard tariff. Even those entrepreneurs who are just starting to think about opening their own business, but do not know where to start, will also be able to receive support, for example, by using the "bank of business ideas 100+" platform," Yaroslav Korniyachenko assures.
"Is it already busy?"
Agree that we are already used to living in a world where there is the diversity that small businesses bring to the streets of our cities. The COVID-19 pandemic has shown how important it is to have a favorite coffee shop next door, a hairdresser across the street or a bakery next door open. Local business certainly plays a key role not only in shaping the community's budget, but also in creating a comfortable life and business activity. And although during the war, Ukrainian business suffered a lot, and some enterprises completely stopped their activities, creating better conditions for doing business in communities allows entrepreneurs not only to stay afloat, but also to develop.
How to determine which industries for starting a small, medium and large business will be promising and profitable in one or another locality?
In the Vlasne Misto project, special attention is paid to craft shops. They will sell not only city products, but also local regional products from Ukrainian farmers. The rendering shows the interior of a local bakery. Image courtesy of the Vlasne Misto press office
"If we talk about potential free niches that can be used to start your own business, then here you can conventionally divide them into three categories according to the size of the investment," explains Korniyachenko. — The first is a ready-made turnkey business. This is a "story" for small entrepreneurs and people who dream of starting their own business. This usually applies to the area of goods and services of the city's small infrastructure. We include small narrow-profile shops, hairdressers, bakeries, coffee shops, and workshops. The second category is business investment. These are investors, owners of medium and large corporate businesses. We see them in the field of education, medicine, energy, HoReCa, agricultural sector and in such large infrastructure facilities as schools and kindergartens, clinics, greenhouses, hotels, restaurants, facilities of critical and entertainment infrastructure. The third category includes those who want to expand their business, thanks in particular to Vlasne Misto. There may be representatives of business projects that have long been known to the metropolitan consumer: craft manufactories, delivery companies, banks, pharmacies, chains of catering establishments, sports sections.
I am convinced that it is always necessary to conduct research on the market and the needs of residents and residents of the city in order to form additional businesses and create conditions for economic stability for business owners and sustainable development of the city. This is our main task."
"It is always necessary to conduct research on the market and the needs of residents and residents of the city in order to form additional businesses and create conditions for economic stability for business owners and sustainable development of the city," - Yaroslav Korniyachenko
As for specific niches for starting your own business within the framework of the Vlasne Misto project, Yaroslav notes the following categories: provision of quality services, in particular for pets, for your own garden or garden, beauty destinations, quality cleaning companies, etc. Also, according to CEO Vlasne Misto, there will be a special demand for shops with essential goods, with local products, as well as local cuisine - coffee and confectionery.
According to the project concept, all shopping areas in Vlasne Misto are created to popularize and develop the culture of consumption of quality Ukrainian products. Visualization provided by the press service of Vlasne Misto
More than good neighborliness
In Europe and the USA, local business often plays a decisive role in the development of the local community. But the issue of city development is not a matter of one industry. Infrastructural, household factors and the development of social institutions are important here. Only a city that develops comprehensively and comprehensively can achieve good economic development and be attractive to its residents. As we previously told in the article "What is a cluster city? Vlasne Misto as a Ukrainian precedent", the project in Dmytrivka is an autonomous, ecological and technological city-cluster. What is important is independent of the capital. "We are not a territory with new buildings, we are a city where its own economy will be built before your eyes," Yaroslav Korniyachenko is convinced.
The company plans to provide more than 21 jobs. This is based on the developed feasibility studies for educational institutions, medicine, agriculture and energy sectors and from the audit of the office center, hospitality and other businesses.
"In practice, we predict that residents of the nearest suburbs and the capital, who will work at Vlasne Misto or open their own business here, will undoubtedly become our residents later. The main thing in creating jobs is a clear and open HR strategy within the cluster, the absence of wages in envelopes," says Yaroslav.
Creating the economy of its own project, the Vlasne Misto team envisages various directions for filling the budget of the Dmitrivska OTG, lays down future programs, in particular, created in cooperation with the leadership of the local community. Among them are compensation programs for newborns, special educational programs, etc. One of the goals of Yaroslav Korniyachenko is also to raise the level of minimum wages in the region: "Among the protected articles of the budget, we want to see a wider list of programs that will allow to increase the level of minimum wages in the region, as well as the interest of employees of various professions to work and develop within the cluster. Some enterprises with which we are negotiating today are developing housing programs for their employees or compensation for the cost of renting or purchasing housing. Today, one of the lowest ZPs is in the field of hospitality and service provision, but thanks to a systematic approach with business owners, we will be able to develop and implement all programs related to training and cost optimization, even with the development of innovative methods and technologies."
Thanks to its own greenhouse, Vlasne Misto will provide its residents with fresh vegetables and herbs throughout the year. Visualization provided by the press service of Vlasne Misto
Cooperation between new settlements and surrounding territorial communities is beneficial for both sides, but above all, rural areas will feel the most positive impact, because they will have access to urban resources, technologies, communication, and transport. And although today there are no global steps in establishing cooperation between cities, cottage towns and neighboring rural territorial communities, legislative opportunities for this have already been created in Ukraine. The Law "On Cooperation of Territorial Communities" defines the legal regulation of various forms of cooperation: from the simplest (one-off project) to the most complex (formation of joint management bodies). Recently, Dmitrivska OTG and Vlasne Misto concluded a partnership memorandum. The main direction of cooperation is the development of the Dmitrivsk OTG itself and the construction of modern European-style infrastructure.
"Our goal is to help and develop business, to unite like-minded people and representatives of the progressive sector of business," - Yaroslav Korniyachenko
Today, agricultural products are grown on the territory of the Dmitrivska community, two enterprises produce high-quality electric cables, which are already used by Vlasne Misto. The management of Vlasne Misto is convinced that the interaction between the business systems of the Dmitrivska OTG and the future town will be fruitful and mutually beneficial, because it involves the creation of a huge number of jobs in new medical and educational institutions, a business park, a hotel, greenhouses, and restaurants.
The district as a whole will also receive its benefits: these are tax revenues, improvement of infrastructure, increase in the gross regional product, creation of goods and services for residents (the basis of food security), attraction of investments and innovations. The Vlasne Misto business center is designed for 13 workplaces, which will also contribute to the unification of the business community of leading specialists and experts and the close connection of all business links.
Vlasne Misto designed 213 square meters. m of area for business development and 400 sq. m for co-working spaces and workspaces. The rendering shows the interior of a co-working space. Image courtesy of the Vlasne Misto press office
"Our co-working spaces and an amphitheater for organizing business conferences will be located in the premises of the entertainment center, next to which there is a parking lot for 500 cars for guests of the event. In addition, on the territory of Vlasne Misto, we designed 15,42 hectares for a congress hotel with an area of 8700 m2, comfortable apartments with full hotel service," says Yaroslav Korniachenko.
Residents of the Dmitrivska community will have free access to the municipal infrastructure of Vlasne Misto as consumers of goods and services.
"For Cluster members, the use of co-working spaces will have its own special rates and booking conditions - all this can be done in the application from a smartphone, having registered accounts", — Yaroslav Korniyachenko
This kind of infrastructure, based on cultural and economic planning, is created by most of the world's leading cities. Educational and communication hubs should spread ideas of self-realization and entrepreneurship among city residents, business incubators and business accelerators should support initiatives at the initial stages, and business centers and industrial parks should become a home for new local companies.
Black list and natural selection
If the developer realizes the importance of creating a comfortable environment for residents, then already at the design stage, he considers the possibility of locating commercial premises for shops, hairdressers, gyms, pharmacies and coffee shops inside the residential building. All this should be located in the immediate vicinity, which greatly facilitates the daily life of residents. At the same time, commercial premises as part of new residential towns are a stable revenue strategy for developers. And it seems everyone wins. But... there is a nuance.
Even at the design stage, an experienced developer studies local supply and demand, familiarizes himself with the profile of the target audience, etc. Is selection necessary? Is it possible to exclude unwanted local businesses? Yaroslav Korniyachenko says that a typical situation among new buildings in Kyiv and the suburbs is when residential complexes are literally filled with duplicate stores, and narrow-profile stores or services that residents really need are somehow absent.
Vlasne Misto is the first project in Ukraine that developed a special VLASNE BUSINESS program on the territory of its own infrastructure, an individual proposal for realizing any business dream close to home. Visualization provided by the press service of Vlasne Misto
"In Vlasne Misto, during the planning of non-residential premises, we immediately placed exactly those businesses that will ensure the comfort of our residents and help solve local problems, and not encourage residents to go to the capital. It is necessary to distribute the spheres of provision of goods and services according to population density. For example, an average adult drinks 500 cups of coffee per year, which is about 1,36 per day. So she will buy at least one cup of coffee in a coffee shop near the house. There are approximately 360 residents in the block, so that's 500 cups of coffee a day. Do we need to have 4 coffee shops in one block? This is ineffective and unprofitable for any entrepreneur. Based on such examples, services will be formed. This applies not only to goods, but also to services: orthopedic shops, studios, dance studios, organization of holidays, shoe repair, beauty bar, bicycle rental and much more that will be necessary to meet local needs," Yaroslav assures.
The Vlasne Business program will help to choose the size of the premises and its location in relation to active zones, recreation zones and others depending on the field of activity, which will help the future owner to get a guaranteed number of customers and create reasonable zonal competition. During the construction of commercial premises, communication nodes necessary for one or another line of business are already provided.
"As for the "black list" of businesses, it exists, and it is easy to understand, based on our concept: these are enterprises that will negatively affect the ecology of the region and the health of the residents of Vlasne Misto and its surroundings, do not have common values with us and over time will produce a low-quality or non-competitive product or service. We are creating a project of sustainable development with preservation of the ecology of the region, reduction of emissions into the atmosphere, and complete zero-waste from the city's vital activities — this goal is facing all businesses today," says the company's CEO Vlasne Misto.
For the organization of conferences, the amphitheater of the entertainment center for 450 seats with a concert area and a space for communication, as well as a parking lot for 500 cars for guests of the event, is offered to residents. Visualization provided by the press service of Vlasne Misto
In the future, the appearance of franchises in the town's infrastructure is also being considered. And although the peculiarities of small settlements do not always allow opening a fashionable boutique from a famous couturier or a haute cuisine restaurant in this territory, but with a carefully chosen implementation format, opening a franchise business can be quite a successful story.
"Franchising means, first of all, that the business has passed certain stages on the way of formation and is now at the scaling stage. There are popular franchises in Ukraine that have positively proven themselves among the Ukrainian consumer, so we are definitely happy to integrate this experience on our territory. Regarding the acquisition of a ready-made business by non-residents, we are also considering such a format. We are sure that after a short period of time they will definitely become our residents. We are open to bright ideas, creative approaches to implementation and bold solutions," Korniyachenko assures.
What is more difficult - to solve the Riemann hypothesis or to build an alternative "best place to live" outside the capital or regional center? The monocentric model of urbanization, so characteristic of modern Ukraine, has long been considered economically inferior. Therefore, any attempt to reverse the trend, when streams of people flock to one big city in search of a better life, deserves attention. It would seem that the recipe from the leading urbanists is simple: cities are primarily people, and successful cities are those whose mechanisms and norms provide residents with a self-sufficient and active life. That is, it is not enough to simply build houses — it is important to create an environment. But this task is not for everyone, but only for the brave and confident. In the next article, we will continue the topic and focus on the question: why does a cluster town have its own design code?
