Wildberries uses slave labor. No kidding. Wildberries has the most real slaves working in its warehouses. They are kidnapped, beaten, their passports taken away, and brought to the company’s warehouse to work for food under the supervision of guards, or should I say supervisors.
Additionally, the company's operations involve using shady methods and directly deceiving contractors and partners. The story of Tatyana Bakalchuk starting her business 'without money, sitting on maternity leave' is completely false.
Currently, Wildberries founder Tatiana Bakalchuk has become the wealthiest woman in Russia. Together with her husband, who owns 1% of the company, they now lead the Forbes ranking of the richest families in Russia, surpassing the owners of Phosagro Gurievs and the well-known Rotenberg family.
Vladimir Ilyin (name changed)
The story of one such slave.
On August 16, 2021, a person from Pskov (name changed to Vladimir Ilyin) was mentioned on the Alternative movement's Instagram. Unidentified individuals promised him a ride home, but instead dropped him off at a Wildberries store in the Moscow region.
Posted on the Instagram account of the 'Alternative' movement
Vladimir Ilyin (name changed) from Pskov had come to Moscow to earn money. When he was buying his ticket at Three Railway Stations Square to return home, some people offered him a free ride to Pskov. Although he agreed, they took him to the Pushkinsky district of Moscow region instead. Vladimir ended up in a basement and was later taken to work at Wildberries warehouses, along with several other men.
According to the former captive at the Wildberries warehouse, where he was held, numerous other men are also being held captive. Their documents were confiscated, and they are under constant surveillance. They are subjected to physical assault for any disobedience, receive no payment, and are provided with substandard food and shelter.
Vladimir Ilyin was freed by members of the human rights organization 'Alternative'. He sent a message to the human rights activists through a warehouse employee, and they arranged his escape.
Following his release, human rights activists reached out to the company about the situation, but no response has been received.
Wildberries responded to Afisha Daily, claiming that the reports were merely black PR and that a contracted organization manages logistics centers, ensuring round-the-clock supervision of all personnel to address any issues that arise.
Article about Wildberries in 'Maxim' magazine
On September 2, 'Maxim' magazine published an article about enslaved individuals at the company. The article was later removed, but I retrieved it from the web archive. web archive.
Screenshot of the page where the article used to be
The article was likely taken down because it contradicted Tatyana Bakalchuk's success story. In her interviews, she claimed to have started her business while on maternity leave, without any money, purely driven by enthusiasm.
Excerpts from the Maxim article, and my personal materials below.
A lovely story of Wildberries achieving success
“Fall 2004. Rain. Tatyana Bakalchuk, who was an English teacher, is traveling through Moscow using public transportation – subway, bus, followed by a 10-minute walk – to pick up another 20-kilogram package of clothes…” This is how the first detailed article about Wildberries begins.
Forbes magazine published it in 2012. Bakalchuk’s online store was in its ninth year and had just surpassed Ozon.ru, Russia’s oldest online retailer, in popularity.
Early and later materials, rare interviews with the founder of Wildberries and her husband Vladislav present the reader with a very glamorous story. Tatyana Bakalchuk did not plan to become an entrepreneur – circumstances led her to. With no initial capital (“I had no money to invest – I only had enough to develop a website”) or experience, she “moved forward intuitively,” eventually becoming the second female entrepreneur in Russian history whose personal fortune exceeded $1 billion. No influential partners, no investors, no government support. The company, which generated nearly 117 billion rubles in revenue in 2019, is still positioned as a family-owned company.
It sounds wonderful. But in reality, it wasn’t quite like that.
Initial funding for Wildberries
Tatiana Bakalchuk’s husband Vladislav was not a radio-physicist at the time Wildberries was launched, but rather a successful businessman. He had been selling computers since the late nineties, and in 2002 he co-founded the UTech provider with his friend Alexei Fadeev. According to the SPARK system, in 2006, UTech had a revenue of about 30 million rubles and a profit of 1.2 million.
The company owned the copyright to the site of UT Design web studio, which created, among other things, online stores. It was this studio that made the first Wildberries site. At the end of 2006, Fadeev found a generous buyer, the company NetByNet, with investment from Gazprombank, which valued UTech at less than $10 million (the most commonly quoted amount was $7.5 million). Bakalchuk owned half of the company, and he received his entire share (various estimates range from three to five million dollars) in cash. But according to Vyacheslav Ivashchenko, Wildberries business development director, UTech profits or money from the sale of shares in the company were not invested in the online store. And Tatyana Bakalchuk said in an interview that her husband sold a stake in UTech to a partner back in 2006, a year before the company was sold.
“Everything we managed to get out of it was invested in the company. I don’t remember the exact amount. I think it was 3 million rubles,” said Tatiana Bakalchuk.
However, the same SPARK does not reflect the sale of the share, and in 2007, Vladislav Bakalchuk was still listed as the owner of 50% of the business.
How Tatyana Bakalchuk’s public image was created
In 2017, Wildberries had a conflict with suppliers. Within a year, the company faced over 24 lawsuits from partners.
- The owner of the brand Prime Jeans was desperate to receive 6 million rubles in debt – and filed a lawsuit for the bankruptcy of Wildberries.
- The company United Fashion Group (UFG) asked for the return of 31 million rubles for the goods they supplied. A UFG representative stated that Wildberries initially asked for 80 million rubles for promotion, then requested discounts, and when refused, threatened to return the seasonal goods for a similar amount.
- The Department claimed that Wildberries wanted to return all unsold goods worth about 5-7 million rubles, and after being refused, gave an ultimatum: either the supplier gets money for the sold goods and takes away the remainder, or gets nothing and takes away all the goods.
Wildberries has won court cases like these before. In the scale of the business (revenue in 2017 was almost 47.5 billion rubles, profit – 428 million) the amount of lawsuits were generally insignificant. But due to the closed nature of the company, rumors of financial problems started to circulate in the market.
Managers complained to Tatyana Bakalchuk and her husband about difficulties in negotiating with suppliers, a former Wildberries employee recalls. The company wanted to work with expensive brands, and the first thing they asked was, “Aren’t you going bankrupt?”
That’s when the Bakalchukes first decided to hire professional PR people. The search was assigned to Egor Pchelintsev, one of Wildberries’ oldest employees. He is now director of advertising and PR. Pchelintsev chose Lampa, a small PR agency. Its owner Yevgenia Lampadova declined to comment – the agency does not disclose details of cooperation with partners.
Татьяна и Владислав Бакальчук
A former employee of Wildberries recalls that the partnership with PR specialists was not easy: they could not pull out infopods, the company’s employees ignored questions from external PR specialists in their work correspondence. But they were not discouraged. Putting on stream the production of press releases about quarterly results and the launch of new product categories, they began to persuade Tatyana Bakalchuk to become the hero of a big story in a leading business publication. A few months later she agreed.
PR people decided that the most profitable way to position the company was through the story of a self-made woman, a former English teacher who started the business shortly after the birth of a child.
The story appeared in Forbes magazine. It largely repeated an article in the same publication published in 2012. But since no one has talked about Wildberries in detail since then, the publication worked exactly as it was meant to. Suppliers became more loyal, having seen Bakalchuk as a “businesswoman from the soil”, there was no shortage of journalists. Gradually Tatiana got involved, began to participate in the social life.
In 2018, the founder of Wildberries gave her first ever video interview on the YouTube channel of billionaire Igor Rybakov. His company, Tekhnonikol, was then doing roofing for the largest Wildberries warehouse of 145,000 square meters near Podolsk.
Family Business
The team at Wildberries has picked a great one. For example, the launch of the company’s own brand was supervised by Marina Andreeva (Kim), Tatiana Bakalchuk’s sister. And here begins uncomplicated family intricacies, like in a play. Here are its protagonists.
- Marina Andreyeva (Kim) is Tatyana Bakalchuk's sister, who is related to Albina Tsoi.
- Albina Tsoi is Yuri Tsoi's sister.
- Yuri Tsoi is Sergey Tsoi's nephew.
- Sergei Tsoi, who was the press secretary of former Moscow Mayor Yuri Luzhkov from 1991 to 2010, is now the First Vice President and State Secretary of RusHydro and Vice President of Rosneft for Material and Technical Support. According to RBC, Rosneft's final boss Igor Sechin has known Tsoi since his time at Luzhkov, and it is important for him to have someone he can trust in an economic position connected with the management of money.
- Anita Tsoi (Anna Kim) is a Russian singer, composer, TV presenter, and philanthropist, and she is a friend of the family of Igor Sechin, the final boss of Rosneft.
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Friend of the Choi family – Igor Sechin
But Wildberries, of course, says that neither Sergei Tsoi nor Anna Kim have anything to do with the development of the company.
Destiny Adidas
Observers of the formation of Wildberries say that the Bakalchukes once ran a secondhand store in the Dynamite shopping center in Vykhino-Zhulebino. Wildberries denies any connection between the store and the company, but in 2003 the address of Dynamite was mentioned in the contacts of the D-Luxe catalog, made by the same studio UT Design. Okay, let's chalk it up to trivial coincidence.
Here's another coincidence. The Dynamite then housed the Universal Gym fitness club of Sergey Glushko, where Sergey Anufriev, business partner of Vladislav Bakalchuk, worked. In 2012, RBC reported that Anufriev owned Wildberries in parity with the Bakalchuk spouses. Anufriev offered his new acquaintances to buy a large batch of Adidas items. According to Russian Forbes, due to the financial crisis in 2008, the German manufacturer was left with an unsold batch of clothes and shoes worth more than 1 million euros. And if other companies refused such a solid deal in such difficult times, Wildberries took the remains on credit and sold them over the next two years. This is how the company's sports division came into being.
Problems with Wildberries suppliers
According to the results of 2016, Wildberries becomes the largest Russian online retailer (according to Data Insight and Ruwards). Analysts estimate the company's sales at 45.6 billion rubles. And in 2017, Wildberries began to have difficulties with its counterparties. By October 2017, the company had received 22 lawsuits from partners, including a bankruptcy lawsuit. The total amount of claims exceeded 283 million rubles. (In the previous three years the retailer was a defendant in 40 proceedings, the amount of partners' claims was just over 146 million rubles.)
Suppliers began to complain about small revenues, were unhappy with the way their goods were discounted and how they were shipped out of the warehouses. Tension began to emerge. For example, in November 2015, Wildberries entered into a shoe supply agreement with fashion distributor United Fashion Group, and a year later, according to UFG, the retailer began systematically preventing shipment of goods and delaying payments, despite the agreed terms and conditions. According to the company's representatives, Wildberries first demanded 80 mln rubles as a trade bonus (the supplier pays it to the seller for promoting goods) and after the refusal to provide a discount the retailer threatened to return the seasonal goods for a comparable amount. And he did. For 41 million rubles.
In January 2017, UFG sent Wildberries a written claim asking for payment of the debt, but the company ignored the letter. Then the supplier went to court. In July 2017, the Arbitration Court of the Moscow region agreed with UFG and ordered Wildberries to pay the distributor 31 million rubles for the delivered goods, 420 thousand rubles as compensation for the losses incurred due to unaccepted goods, and 200 thousand rubles to cover the cost of the state duty.
At the same time, rumors of Wildberries’ bankruptcy began to appear because the company was closed to the media. Then the founders of the online store hired professional PR specialists, who decided that it was necessary to promote the story of Tatyana Bakalchuk – a simple English teacher, who on her maternity leave decided to go into business and became a successful businesswoman. The material was published in Forbes, and the publication worked – the suppliers became more loyal.
Mass layoffs of Wildberries employees
In November 2020, Wildberries employees began complaining about layoffs “by entire teams ‘of their own free will'”. The head of the company’s mobile development team, Tatiana Averyanova, told her Instagram account that the marketplace was not paying compensation, was not recruiting new employees, and was withholding wages to its current employees.
“My team was told that the project is closed, there is no budget to maintain the team and everyone has to write a letter of resignation. My project is far from my first. I managed to transfer several employees to other projects, but then it became known that these projects are also closed or cut as much as possible. Those who refuse to write a resignation and wait for an official reduction, they just do not get anything, “- Tatiana wrote.
So Wildberries has stated that the information about mass dismissals is not true, and the company has more than three thousand vacancies, and in general it is just a relocation of retail facilities – “ineffective ones are closing, but new ones are opening”.
By the way, employees of Wildberries, who work at the delivery, often complain that they hang on them things that, for whatever reason, customers refused to take, including defective goods.
Penalties for sellers
In March 2021 a screenshot of an official letter from Wildberries to one of the sellers appeared in the Marketplace Merchants chat:
Good afternoon.
We have identified 52 fake (custom) reviews from your side on their products. We are forced to impose a penalty on you in the amount of 100,000 rubles. Enclosed DS + Act. You need to fill in the details of the DC and upload the document.
We look forward to hearing from you.
The support service confirmed that this is a real letter, and the amount of the fine was taken naturally from the ceiling.
“There are no rules and no ratios. Feedback falsification as a fact is forbidden. It’s the reputation of the site and the image for customers. Such a thing as scamming is nowhere welcomed and, accordingly, suppressed, and you should be aware of it. If it’s your product, it does not mean that you can spin reviews on it, and then be surprised that it put a fine, the site owner reserves the right to set the current rules and penalties “- explained in support service.
How did Wildberries business start and what role did Bakalchuk’s partner, whom they rarely mention, play in its formation
It is believed that early on Tatiana Bakalchuk’s business involved reselling clothes and shoes from German catalogs, which was a popular venture in the early 2000s. She recalls standing out among many competitors by setting a universal 10% markup for buyers nationwide and not requiring an advance payment.
- set a single markup for buyers from all over the country: 10% (other agents took 15% from Muscovites and up to 30% from residents of other regions);
- did not ask for an advance payment.
This was enough for “Wildberries to expand, to develop faster and faster.
Bakalchuk got her first subordinates: “I called my younger sister, then [my husband’s] co-worker Vlad. But there were more and more orders and we couldn’t cope, so we called out to our acquaintances, our relatives. My father had already drawn his pension, but went back to work when we registered the LLC. My aunt became an accountant. Almost all the relatives came to help.”
“Good employees are constantly circulating between the other players – it looks like a touring troupe, while Wildberries originally had the idea of building the business as a family: many top people were raised within the company,” shares observations Alexander Ivanov, president of the National Association of Distance Trade (NADT).
Tatyana Bakalchuk’s sister Marina Andreeva (Kim) worked at Wildberries. She supervised the launch of her own brand, a former employee of the company told The Bell.
On social networks, Andreeva also lists a relative, Albina Tsoi. She is the sister of Yuri Tsoi, the nephew of Rosneft Vice President Sergei Tsoi, who used to head Yuri Luzhkov’s press service.
Journalists call Tsoi’s wife Anna Kim, known under the creative pseudonym Anita Tsoi, “a friend of the family of Rosneft head Igor Sechin” (Wildberries says that Sergei Tsoi and Anna Kim were not involved in the development of the company).
From the very beginning, Bakalchuky did not just deal in things from catalogs like Otto or Quelle. According to him, they sold clothes in a second hand shop in the Dynamite shopping centre in the Vykhino-Zhulebino district. It was positioned as a point with 1000 models of second-hand clothes from Europe. Some of the items were distributed through the site. In 2003, the address of the shopping center was listed in the contacts of the catalog D-Luxe, made by the studio of UT Design Bakalchuk and Fadeev. Wildberries claims that the store was not affiliated with the company.
In “Dynamite” Vladislav Bakalchuk could meet his future business partner Sergei Anufriev, at that time – an employee of the Universal Gym fitness club, located in the same shopping center. It was founded by popular stripper and bodybuilder Sergey Glushko (Tarzan). Glushko told The Bell that he remembers Anufriev, but he did not communicate with him closely.
Several interlocutors (in particular, an acquaintance of Alexei Fadeev and a former employee of Wildberries) say that Anufriev offered his new acquaintances to buy a large batch of Adidas items, which several wholesale buyers had previously refused. Why exactly they refused, they do not know.
The person being interviewed, who managed a big online clothing store in the mid-2010s, said that a significant portion of the products in his business at that time, like Wildberries, were what they call 'liquidation purchases'. For instance, a certain brand had a lot of extra inventory. Or there was a batch that they didn't want to sell through regular retail channels. To make these kinds of sales, early Russian e-commerce pioneers traveled to Europe. Gray imports were also common in those years: in 2005, the Central Bank estimated their share at more than 20%, then it dropped to 8%, but after the 2008 crisis, it went up again.
The sources say that the significant batch was valued at $1 to $5 million. It's unclear whether Anufriev used his own money. It was impossible to confirm whether he was in business before Wildberries, and he declined to speak after considering for a long time.
In any case, a few years later, the media already portrayed Anufriev as a co-owner of Wildberries.
For about a year, Adidas items were the main part of the assortment, then they added products from other brands like Esprit, S.Oliver, Tommy Hilfiger, LTB, Nike, Puma, Levi’s, Mustang, Mexx, and Geox. But even in 2009-2010, Wildberries remained a generic online store, a mix, according to customer feedback from that time. Some customers complained that the items didn't look like the picture, they mentioned delivery delays, and praised Wildberries for a good call-center.
To make the first profit, Bakalchuki rented an office in the village of Milkovo, Moscow region, where the company’s legal address is still registered. This makes it a regional taxpayer. The company is not planning to move to Moscow yet.
In 2010, without Anufriev’s involvement, not a single financial issue was addressed in Wildberries, remembers a former employee of the company. 'Tatiana [Bakalchuk] managed the cash flow, she didn't even have a separate office. If she disagreed with Anufriev, he would say, 'I told you so.' And no one argued anymore. He could tell her which suppliers to use, how to market, anything. He installed a polygraph, on the advice of his police friends, and told everyone to take the test.'
In the early years, the company faced many typical problems. Most of the goods were bought from suppliers without any delay in payment, and Russian Post regularly lost, delayed, or delivered damaged parcels. Customers complained about defects and counterfeits.
₽ 116.9 billion in revenue for Wildberries in 2019 (according to SPARK)
Why Wildberries is disliked by suppliers and why few of them can afford to refuse to cooperate
'What makes Wildberries dominant right now? Probably due to the aggressive behavior towards suppliers,' the head of a large supplier company reasoned. – We didn’t pay attention for a long time, and when we did, it was a little late. Wildberries got people addicted to discounts: no one buys anything at full price. Like Offprice – only online. It was the dumping that allowed everyone to get ahead of the curve. But the dumping is at our expense.
But there is one important nuance that many suppliers do not like: prices are set not by them, but by Wildberries. “According to Russian law, the transfer of goods takes place by waybills. They include the so-called price of responsibility, which roughly corresponds to the wholesale price. On average on the market this is 40-50% of the recommended retail price (RRPs), which the FAS does not like, – says the interlocutor – As a rule, all sites adhere to RRPs. Discounts and promotions are negotiated with suppliers. Wildberries is an exception. They say: If you do not want – remove your product from the site. And this is a stick with two ends. On the one hand, Wildberries is a powerful machine, capable of selling as much product as you want. On the other hand, if you work only with Wildberries, you can easily ruin the rest of the market and even go into deficit.
Every day discounts are a hallmark of Wildberries. “Bomb Days: -10% off up to 90% off”. “Customer Days: give 20% off everyone-anything-anything.” “Stock Clearance Days. -50% and up.” “Super-brand prices: discounts of 50% and up”. “Summer liquidation: -40% and up on clothing and shoes.” “Customer Days: up to -10% off customer discounts on electronics and appliances.” Such promotions don’t even succeed each other, but run concurrently. The ones listed roll around in a slider on the first screen of the site. In general, there are many more, and after the first purchase the client enters the loyalty program and receives even more discounts.
Conclusion about Wildberries
Tatyana Bakalchuk’s fantasies about her success story are her own business. If she wants such a fairy tale, let her live in it. The gray business schemes that abound in the company are a serious matter. But it should be dealt with by law enforcement agencies, the Federal Tax Service and the Antimonopoly Service.
The main thing for us now is the captives locked in the premises, which belong to Tatyana Bakalchuk’s company.
