FMTKP: A success story of transformation, growth and partnership

Miljan Zarkovic

General Manager of FMTKP

FMTKP: A SUCCESS STORY OF TRANSFORMATION, GROWTH AND PARTNERSHIP

As the new General Manager of FMTKP, you are taking over a company that has had an exceptionally successful decade behind it. What are the biggest changes that shaped the company during this period, and how do they lay the foundation for the next phase of its development?

M. Zarkovic: When you take the helm of a company that has successfully built a strong market presence for more than ten years, it is a great honor, but also a responsibility to bring new energy, a clear direction and personal commitment. For me, this role also has a special personal dimension, because FMTKP is not a story I came to know from the outside. During part of that ten-year period, I was part of the company, although in a different position, and I had the opportunity to take part first-hand in the changes, challenges and important steps that shaped its transformation. That is precisely why returning to FMTKP is not only a new professional challenge for me, but also a sense of continuing a story into which I have invested part of my experience and energy, and in whose potential I genuinely believe.

Today, I am especially pleased to return in a new role, with the opportunity to continue the growth of a team that has already proven it knows how to deliver results and adapt when it matters most. Throughout my career, I have learned that the most powerful changes do not happen through a single decision, but through trust in people, discipline and a daily readiness to learn and take one step further.

Looking back, I am proud of what FMTKP has achieved. The strategic partnership between Philip Morris International and Tutunski Kombinat Prilep has shown that a clear vision, knowledge and long-term commitment can create a model that delivers value for the company, its partners and the wider community. Today, FMTKP is not merely a company that manufactures and sells traditional tobacco products; it is part of a global transformation in which science, technology and innovation play an increasingly important role. In the next phase, we will continue to build on these foundations, with an even stronger focus on innovation, new technologies and sustainability, while preserving the same energy that brought us this far: partnership, a shared vision and the courage to evolve in line with global trends.

"The partnership between Philip Morris and Tutunski Kombinat Prilep positioned FMTKP within a broader, modern production chain — with higher standards, modernized processes, new knowledge and production capacity that today has regional and international relevance."

The strategic partnership between Philip Morris and Tutunski Kombinat Prilep is often cited as an example of successful transformation. What is the result you are most proud of, and why?

M. Zarkovic: What I am most proud of is that this partnership transformed a challenge into stability, and stability into room for growth. Tutunski Kombinat Prilep entered the partnership at a time of serious financial difficulties, while today we are talking about a company built on sound foundations, with positive results and a clear outlook.

This change did not happen overnight. It is the result of a great deal of work, patience and belief that, with the right approach, an entire story can be changed. What motivates me most personally is precisely that moment when you see that the team is not afraid of change, that people embrace new standards and that every step forward has a real impact on the company and the community.

By improving tobacco purchasing processes, modernizing production, managing costs more efficiently and introducing innovations, I believe that Tutunski Kombinat Prilep is successfully preserving the tradition of Macedonian tobacco growing in a modern and sustainable way, while placing the industry on a more competitive and stable long-term path.

How have the development of production, inclusion in international production flows and the growth of export activities changed the position of a factory from Prilep, and what measurable results has this brought for FMTKP, Tutunski Kombinat Prilep and the Macedonian economy?

M. Zarkovic: This is one of the strongest confirmations that when local tradition is combined with international expertise, a clear vision and disciplined execution, high-quality local production can extend far beyond the boundaries of a single company. The partnership between Philip Morris and Tutunski Kombinat Prilep positioned FMTKP within a broader, modern production chain — with higher standards, modernized processes, new knowledge and production capacity that today has regional and international relevance.

For me, the most important thing is that this is not merely a story about numbers, but a story about transforming local potential into competitive value. When what is created at home can meet the demands of foreign markets, it sends a strong message that growth is not accidental, but the result of knowledge, people, capacity, discipline and long-term commitment.

The impact and growth can also be seen in the development of production and exports: the export component, which began in 2023, increased several-fold by the end of 2025, confirming the ability of local production to meet the requirements of international markets.

But the substance goes even further: a stable production chain, direct support for more than 700 jobs, continuous investment, development of the local community, stronger exports and a significant contribution to public revenues. That is why I do not view the contribution to the Macedonian economy solely as a financial result, but as the creation of long-term value — for the company, for people, for Prilep and for Macedonia.

What was the boldest decision made by Philip Morris Tutunski Kombinat Prilep, and how did it change the course of the company's development?

M. Zarkovic: Launching IQOS on the Macedonian market was one of the boldest and most important decisions in the development of FMTKP. The essence of that decision was not simply to introduce a new product, but to offer a less harmful alternative for adult smokers who would otherwise continue to smoke.

For me, it was an important step that opened up a new way of thinking: moving from a conventional approach to the category toward one based on science, evidence, technology and responsibility. Introducing new products and communicating responsibly at a time when the market was still learning and habits were difficult to change showed us that patience, consistency, access to information and strong belief in the direction we were taking were essential.

That is why, from the very beginning, we did not focus solely on sales; we placed priority on educating and informing adult consumers. Our role is to ensure that they have access to accurate, clear and science-based information about smoke-free alternatives, their benefits and risks, so that they can make an informed decision for themselves.

We continued in this direction with the introduction of another smoke-free product, ZYN nicotine pouches, which became available on the domestic market last year. This approach reflects Philip Morris's global vision and our commitment to contributing — through alternative products, science-based information and responsible communication — to a real reduction in smoking rates and to a smoke-free future grounded in science.

In recent years, we have seen growing interest in smoke-free products, while Philip Morris is among the companies investing most heavily in science, research, technology and the development of new product categories. How is this global strategy and transformation toward new categories reflected in the Macedonian market?

"Smoke-free products are developed and assessed through a scientific approach — from aerosol analysis and toxicological testing to clinical studies and monitoring consumer behavior."

M. Zarkovic: This transformation is not only commercial; above all, it is scientific and technological. Smoke-free products are developed and assessed through a scientific approach — from aerosol analysis and toxicological testing to clinical studies and monitoring consumer behavior.

In the domestic market, this means that we continue to invest in informing adult smokers about the available alternatives, their benefits, limitations and risks. Our goal is not for these products to reach the widest possible audience, but the right audience: adult smokers who are looking for a better alternative than continuing to smoke cigarettes.

At the same time, our position regarding minors is completely clear: we do not allow or accept the sale of these products to minors. We stand firmly by this principle — through strict rules, checks, training and responsible communication across sales channels, as well as through campaigns that raise awareness and provide information to young people. I believe this is the only way this transformation can have real value: when science, innovation and responsibility work together in the interests of adult smokers and society at large.

There is often public debate about the legal regulations intended to reduce smoking rates. Is the answer stricter bans, penalties and restrictions, or providing better alternatives for smokers?

M. Zarkovic: I do not think the answer can be reduced to one or the other. Experience shows that the most effective approach is a combination of measures with the same goal: reducing cigarette use and protecting public health.

Examples from the EU show that high prices, penalties and restrictions can be an important part of policy, but on their own they are not enough to significantly reduce smoking rates across different countries. On the contrary, they can also create unintended effects, such as growth in the illicit market and losses in public revenues.

On the other hand, alternative nicotine products must be discussed on the basis of scientific facts rather than perceptions. If an adult smoker who would otherwise continue to smoke switches completely to a non-combustible product, scientific data indicate significantly reduced exposure to a number of harmful substances compared with continuing to smoke cigarettes.

This does not mean that the products are risk-free, nor that they are intended for non-smokers or minors. On the contrary, this is precisely why regulation should be strict where the risk is greatest — in protecting minors and controlling sales — while also being sufficiently informed to give adult smokers access to accurate information.

A successful public-health policy is one that genuinely reduces smoking rates through a combination of prevention, control, action against illicit trade, responsible regulation and access to science-based information.

Today, successful companies are measured not only by their financial results, but also by their contribution to society. What kind of company would you like FMTKP to be for its employees, partners and the community?

"I personally believe that the strongest energy in a company comes from people who feel that their work is seen, that they have room to grow and that they are part of something bigger."

M. Zarkovic: A successful company is one in which results go hand in hand with responsibility toward people and the environment in which it operates. I personally believe that the strongest energy in a company comes from people who feel that their work is seen, that they have room to grow and that they are part of something bigger.

That is why it is important to me for FMTKP to be an environment in which employees identify with the company, develop professionally, have a voice and feel that their contribution truly matters. Throughout my own professional experience, I have often seen how trust, mentorship and open communication can be decisive for someone's growth.

We build the same values within the company and with our partners — trust, respect for commitments undertaken and relationships that are not based on short-term interests.

Our responsibility also extends beyond the business world. Through donations, projects and initiatives, we focus on what we leave behind and on the future we want to build for the community. If the decisions we make today create a more stable, more sustainable and better environment for people, then we know we are moving in the right direction.

As General Manager of FMTKP, what is your personal vision for the company in the years ahead, and what legacy would you like to leave behind?

M. Zarkovic: I see FMTKP as a strong, modern and competitive local company that successfully combines global ambition with local responsibility. A company deeply connected to its roots, to its people and to the community in which it operates, creating value not only through its business results, but also through its contribution to Macedonia's economic and social development.

For me, that is the essence of the vision for FMTKP — to be part of Philip Morris's global transformation while remaining firmly rooted in Macedonia, building a stable and sustainable future for all its stakeholders.

As someone who is deeply connected to this country, I genuinely believe that the company's success is closely linked to the success of the community in which we operate. That is why I am committed to its growth, to strengthening its position and to creating a trajectory in which a local company can serve as an example of stability, integrity, positive impact and continuous economic progress.

I want FMTKP to be recognized as a driver of development and as proof that successful stories with regional and global significance can be created in Macedonia as well, inspiring future generations to believe in their own capabilities and potential.

I see the greatest opportunities for future development in innovation, digitalization, technological modernization and the continuous advancement of our people's knowledge and skills. The world is changing at an unprecedented pace, and the successful companies will be those with the vision, courage and ability to transform alongside it.

FMTKP's strength lies precisely in that balance — being modern and open to global trends and the future of the industry, while remaining close to its people, its tradition and its role in the development of Macedonia.

"The world is changing at an unprecedented pace, and the successful companies will be those with the vision, courage and ability to transform alongside it."

Interview by: Kirko Boskoski