On the road with Latvian exporters: ELKO Group

While the time and place for meeting ELKO Group founder Egons Mednis was arranged in advance, we are apparently joined by a third person who has transcended time, if not place.

“It seems she still takes care of Dikļi, which she managed herself for more than twenty years as a member of the famous von Rosen family. At our very first event here, a wedding, she was seen in this part of the building and whenever something new happens at Dikļi she seems to visit, perhaps to check it is all correct. She's definitely positive,” says Mednis.

“This place exists thanks to my main business, which allows me to keep Dikļi manor,” he explains as we walk the parquet floors and creaking wooden staircases. “It started in the early 1990s when I was young guy, hungry to do something. We started Elko in IT wholesale, then in 1996 I was invited to a conference near London which was taking place in a historic house with a park. It left a big impression on me personally, and I kept thinking about it for years afterwards. You can't buy history, this awareness of hundreds of years for any money. But I thought to myself: why can't we do such things in our own country?” 

A passion for field sports and hunting made Mednis a regular in the thick forests that cover this part of northern Latvia in the years afterwards, while Elko grew rapidly into a major business, until one day a hunter friend mentioned that a local manor house was up for sale.

“We came and looked, but the price was quite high and the state of the building was terrible. But two years later the owners were very keen to sell and the price was reasonable. Those thoughts I'd had in England came to back to me and being in a good financial situation I was able to buy it in 2000, constructions started and it's been open as the Dikļi Palace Hotel since 2003,” he says.

The care and attention to detail lavished on Dikļi manor became legendary, so that it is now held up as an almost perfect case study of how to restore Latvia's many dilapidated manor houses, giving them new life as family homes as well as businesses. To Mednis, Dikļi clearly represents both and during the hunting season he regularly takes up residence alongside the other guests.

“It's not so much a pure business project as a place where people can be happy, work and relax in fresh air and enjoying the richness of nature,” says Mednis, pointing out the paintings and fireplaces that now form nationally important collections of art and antiques.

While the manor provides a refuge from the pressures of business, that same ability displayed in Dikļi's purchase - knowing when the time is right to do a deal - must also have played its part in ELKO's success.

“This year we celebrate 25 years of ELKO. Each year it has changed. We grew from a small local company to one that supplies IT goods directly to more than ten countries and indirectly to almost all Eastern European countries with a presence in 12 countries,” Mednis says. 

Starting with PC components for local assembly, ELKO managed to keep up with the quickly-changing trends in the IT sector, supplying notebooks, smartphones, tablets and other goods. It now has a product line of 29,000 different items which it supplies to 7,700 clients. Turnover in 2017 was 1.5 billion dollars and the group employs more than 700 people, amking it a very important part pof Latvia's national economy.

Interestingly, Mednis notes that one current trend is a return to selling individual components, driven in large part by things like Bitcoin mining and the computer gaming industry where players want to customise their systems.

“You have to change with the times, and it is a challenge, but I think in our industry this is the interesting part – it never gets boring. If you are too late, you can be gone from the market very quickly.”

But as Charlotte would no doubt say - if she could - if you know what you are doing, you can remain a force for a lot longer than 25 years.