How Zarys turned a pandemic windfall into lasting growth

The disposable medical-equipment supplier is now selling more than it did during covid. Paweł Ossowski discusses Zarys’s expansion, startups, a failed attempt to invest in Górnik Zabrze football club, and the barriers that Polish entrepreneurs still face.

During the COVID-19 pandemic, some businesses – including shops and restaurants – were temporarily unable to operate. Others could not keep up with demand. The latter group included suppliers of personal protective equipment.

Polish stock-market investors were quick to take notice of Mercator Medical. Its valuation soared from less than PLN 100m (EUR 23m) to more than PLN 7bn (EUR 1.6bn) within just a few months. Monika Żyznowska, who took over management of the family business from her father, recently spoke at length about that extraordinary period and the company’s subsequent development in an interview with XYZ.

Somewhat in Mercator’s shadow, another disposable medical-equipment supplier was expanding rapidly outside the stockmarket: Zarys International. The company was founded in 1989 by Jacek Ossowski, who over the following decades transformed it from a simple wholesaler into a manufacturer operating in international markets.

Since 2020, the family business has been run by the founder’s son, Paweł Ossowski. He took over as chief executive as revenue surged from PLN 200m (EUR 47m) to PLN 850m (EUR 198m), while net profit rose from PLN 8m (EUR 1.9m) to more than PLN 270m (EUR 63m). Results fell sharply after the pandemic, but they remain well above pre-pandemic levels. This reflects, among other things, investments in expanding exports and a broad, diversified product offering.

Zarys operates across four main categories: medical gloves, wound-care products, surgical sets and a broad range of disposable medical devices, including needles, catheters and syringes. It offers thousands of products in each category, while its overall portfolio comprises tens of thousands of items.

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From a simple wholesaler to independent manufacturing

Mariusz Bartodziej, XYZ: In 1989, your father, Jacek Ossowski, founded Zarys. In 2021, you opened Central Europe’s largest warehouse for disposable medical equipment, covering 40,000 sqm, and in 2024 you moved into a new headquarters in Zabrze. Based on this brief history on your website, one might get the impression that the past few years have been the most important period in the company’s history.

Paweł Ossowski, CEO and co-owner of Zarys International: Not quite. It is true that our growth has been most visible over the past few years. But without the solid foundations my father built over the preceding decades, we would have seen nothing more than a temporary spike in results. Instead, we have managed to achieve lasting success.

So why the jump in time, and why those three dates in particular?

The two events you mentioned – apart from the company’s founding – are the most spectacular ones. The painstaking process of building a business over many years, with its ups and downs, is not nearly as “sexy” as today’s success story.

We started out as a conventional medical-supplies wholesaler. Initially, we sold only products made by Polish companies, and later added products from established global manufacturers. More than two decades ago, we began developing our own Zarys brand – it now accounts for most of our revenue and almost 100% of our international sales – and began contracting manufacturing ourselves. We even produce some of our surgical sets at our facility in Zabrze. This has given us greater independence and control over the business.

The pandemic as a springboard for lasting success

The main catalyst was the COVID-19 pandemic, when demand for products such as protective medical gloves soared. How prepared were you for an event whose scale was impossible to predict, even after the first reports emerged?

No one was perfectly prepared for such an unprecedented event. But we were in a very different position from many companies that discovered personal protective equipment only once the pandemic began. We had longstanding relationships with suppliers, production already under contract, and large inventories of masks, gloves, gowns and other products.

Our ability to increase supplies from day one was our advantage. Most competitors entered the market only once demand had begun to catch up with supply. Knowing that we could not meet demand across the whole of Europe, we made a conscious decision to focus primarily on Polish hospitals.

How much of that decision was patriotism, and how much was a calculation that local demand would be easier to serve?

No one will probably believe me today, but a sense of local patriotism was the decisive factor. Paradoxically, selling in Poland proved more difficult than selling abroad. We handled complex contracts in cooperation with hospitals, the Ministry of Health and regional authorities.

As a Polish company generating around 90% of its revenue from the domestic market at the time, we felt responsible for ensuring supplies. This was all the more important because foreign suppliers suddenly began redirecting goods to other countries, where they could presumably secure better terms.

An unprecedented management school

What was it like managing the company amid an unprecedented surge in orders?

It was micromanagement. We made hundreds of small decisions every day. In business, decision-making paralysis is generally harmful, but back then, the speed at which we made decisions was absolutely critical. It had little to do with textbook management. What we did gain was an exceptional education in operating under pressure. A dozen or so people at the company were working 16–18 hours a day.

So there was no time left for your private life.

Not really, although the circumstances themselves did not exactly encourage it. There was no lockdown or remote work for us. We had to be on-site every day and operate at full throttle.

Zarys is selling more than it did during the pandemic

In 2019, your revenue was PLN 200m (EUR 47m) and your profit was in the tens of millions of złoty. That was roughly half the scale of Mercator, the Warsaw-listed company that generated PLN 1.4bn (EUR 327m) in extraordinary net profit in 2020–2021. To what extent did Zarys capitalize on the opportunity for global growth?

We came out of the pandemic twice as large in terms of sales. We are also on track to eventually return to the extraordinary financial results we achieved in 2020–2021. Those results, however, were mainly driven by a sharp rise in market prices. Products that had previously cost PLN 8–10 suddenly sold for as much as PLN 40.

From the outset, we understood the opportunity the market presented. But our priority was to sustain growth in sales volumes. And we succeeded. Since 2020, we have sold more products every year.

How is that possible, given that pandemic demand eventually faded and many new suppliers were left with warehouses full of stock?

It is the result of consistently broadening our offering over many years. Today, it is the broadest in Europe. Personal protective equipment is only one part of our business. Most of our products go to operating theaters and intensive-care units. We can meet almost all of a hospital’s demand for disposable medical equipment.

In addition, with a strong brand and greater working capital, we decided towards the end of the pandemic to significantly accelerate our export expansion. For years, exports had been just an add-on to our business. Today, they are the foundation for our continued expansion.

In recent years, Zarys, under the leadership of Paweł Ossowski, has undergone changes on many fronts. In 2021, the company carried out the second rebranding in its more than 30-year history, 15 years after its previous change of corporate identity. Photo: press materials/Zarys International

Several hundred million złoty in extra profit to fuel growth

In 2020–2021, your combined net profit exceeded PLN 360m (EUR 84m). That is comparable to the company’s total revenue over the previous two years. It is also worth noting that you avoided the crisis experienced by some others in the industry. You did not report a loss even once.

A sudden surplus of several hundred million złoty comes with considerable risk. It brings responsibility for deciding how best to deploy the money. We allocated some of it to diversifying the family’s wealth. But we regard the company itself as our most valuable asset, so that is where we invested most of the funds.

What did you invest in specifically?

Working capital is particularly important in our industry. We need to maintain large stocks of fast-moving goods, for which customers often pay with a delay – sometimes a significant one.

To a large extent, we operate in the public-procurement market, not only in Poland. We therefore allocated roughly one-third of our “covid profit” to increasing working capital, allowing us to accelerate our expansion.

And the rest?

Another third went towards expanding exports, including opening local offices in other European countries. We invested the remaining amount – several tens of millions of złoty – in infrastructure and our workforce. We launched a distribution center and a new office, while headcount increased from 200 in 2019 to more than 500 today.

Over the next few years, we are considering an automated warehouse. Such an investment could be worth as much as several hundred million złoty. We are also weighing various scenarios for expanding our own manufacturing operations.

Zarys has no plans to sell or go public

Where do acquisitions fit into all of this? Were you put off by excessively high valuations?

We have completed three small acquisitions in Poland, each worth a few million złoty, which have broadened our portfolio. But we have not made any transformative moves. Owners were valuing companies based on their “covid” results, assuming that favorable market conditions would continue. That was irrational. We did not want to overpay.

We already have a very strong position in Poland – we are the sales leader in many categories of disposable medical products, including gloves. Abroad, we are still building our position, and acquisitions could accelerate that process.

That is a prospect for the coming years, however, because we need to prepare properly for such transactions. We expect to pursue significantly larger acquisitions than those we have made so far – worth at least several million euros.

“It was absolute madness” – that is how Monika Żyznowska, Mercator’s CEO, described in an interview with XYZ the sudden and short-lived surge in the company’s stockmarket valuation from almost PLN 100m (EUR 23m) to more than PLN 7bn (EUR 1.6bn). Did investors approach you willing to pay a symbolic PLN 1bn (EUR 233m) for Zarys?

I agree that the surge in valuations of listed companies in our industry was madness. After the pandemic, we were approached by numerous private-equity funds and strategic investors.

But we are not looking for an exit. My ambition is to build a European champion in the medical-products sector. We do not need a partner to do that at this stage, so we have not entered into discussions with anyone about a potential valuation of the company.

Did being privately held help during the pandemic, because you could focus on the business rather than dealing with a broad base of investors?

Absolutely. The stockmarket provides access to capital, but it also brings a host of obligations. We have never considered going public on the Warsaw Stock Exchange and do not plan to do so in the near future. We are not pursuing aggressive expansion, and we have always been able to secure the financing we need from banks.

A desire to prove himself in business from an early age

How did you imagine taking over as CEO of the family business? The middle of the COVID-19 pandemic was hardly an ideal time for a smooth transition into a new role.

I have been the sole member of the management board since May 2018 and, in practice, have run the company since then. But my father wanted me to prove myself further before formally becoming CEO. The change in title was already necessary, if only to enhance the company’s credibility in discussions with new contractors and business partners.

2018 and 2019 were difficult years. Competition was intensifying, and I was worried about whether we would be able to increase revenue by 15% in 2020, to around PLN 230m (EUR 54m). Given the extraordinary circumstances, we ended up generating more than PLN 850m (EUR 198m).

Mercator has more in common with you than a similar business profile: its successors, too, have spent their entire careers in the family business. Unlike Monika Żyznowska, whom you mentioned, did you already prepare yourself mentally during your university years to eventually take over the company?

From the beginning, I knew I wanted to try my hand at business and work in the family company. I do not know where that motivation came from, because my father never put any pressure on me. But conversations about Zarys were a part of everyday life at home, and I absorbed them.

I spent half of the longest holiday of my life – the summer after high school – working in the warehouse. During my undergraduate studies in Warsaw, I became even more involved with Zarys. After moving to Sydney to study, I often flew to Asia to oversee purchasing. After graduating in 2013, I joined the company full-time.

Responsibility for the family business

Before joining the management board in 2016, you were responsible for sales and business development as a manager. How much of the organization had you managed to get to know?

I tried to get to know as much of the company as possible. I was simply interested in it. I also understood how important it was to grasp the fundamentals of the organization I would one day be running.

Given my interest in international affairs, I was particularly drawn to procurement and exports. For two years, however, I also worked as a sales representative, dealing directly with hospitals.

And what did you find most difficult?

Organizational, administrative and financial matters. They are the least exciting parts of running a business, but they are essential to keeping it operating smoothly. In recent years, I have therefore focused heavily on developing my expertise in efficient logistics and working-capital management.

How often did you feel that you would not be able to handle the pressure or meet expectations, including those you had set for yourself?

There is certainly something to the idea that we often put pressure on ourselves. Working in a family business is hugely rewarding, but it also comes with an equally significant sense of responsibility.

Being handed a well-prepared company with the task of taking it to the next stage of development is a huge obligation. You do not have the luxury of thinking that if things do not work out after three years, you can simply go and work somewhere else. The emotional burden is incomparably greater. The desire to prove yourself and show that you were the right person to take over the company is extremely strong.

The image of the entrepreneur: “a bad private businessman”, not a partner for dialogue

What does the next generation of entrepreneurs bring to Polish companies?

As a country, we are in a very good place. Poland has become the world’s 20th-largest economy. Many companies founded in the early 1990s are now seeing the second generation come in – well educated, with a broader perspective and ready to build on the solid foundations laid by their parents.

The fifth or sixth generation running businesses in countries such as Germany no longer has quite the same hunger for success. In Poland, we certainly do not lack ambition. Combined with entrepreneurship, it creates the conditions for building European, and even global, champions. And that is exactly what is happening. The next generation of Polish entrepreneurs is taking home-grown companies well beyond the country’s borders.

What about the barriers?

I am interested in history. Unfortunately, Poles have this unfortunate tendency: just when everything starts going exceptionally well, we put obstacles in our own way.

You would think that, on the back of Poland’s growing popularity as an economic success story, we would be keen to promote the achievements of our businesses. Yet there is still a lack of regulatory stability, while politicians’ attitude is – putting it mildly – not entirely pro-business.

What do you mean by that?

We are still sometimes seen as “those bad private businessmen”, rather than partners for serious dialogue and a natural “export product”. When the state budget no longer adds up, we are among the first to be singled out for higher taxes.

Does that discourage you from being an entrepreneur?

Quite the opposite – it motivates us to expand abroad even faster. We have already experienced several instances in Poland of treatment that has encouraged us to diversify geographically even further.

Western Europe in Zarys’s plans

What kind of employees are you looking for to build a European champion?

Ambitious and creative people. In fast-growing companies, character can sometimes matter more than hard skills. I want to surround myself with people who are hungry for success, but also proud to work in the medical-products industry. I myself feel a sense of pride when I see medical workers fighting the Ebola epidemic in the Democratic Republic of the Congo, using protective equipment we supplied.

You already export to more than 70 countries while also opening local offices. Spain was added to the list this year.

We want to become one of Europe’s largest players, so we need direct distribution. Building it, however, is a long-term process. The biggest opportunities lie in the most competitive Western European markets: Germany, France, Italy and Spain. For now, we operate there through distribution partners.

We began working directly with hospitals in smaller countries such as the Czech Republic, Hungary and Portugal. In 2027, or 2028 at the latest, we intend to introduce this model in one of the four Western European markets I mentioned. We are also keeping a close eye on Britain and Scandinavia. We are benefiting from the increasingly positive perception of Polish companies abroad.

What do you mean by that?

Poland is now associated with economic success and a high level of development. Partners see that they can get European quality from us at a somewhat lower price than in Germany or France. This combination works particularly well in our dealings with partners in Asia and Africa.

When it comes to expanding into the latter, the absence of a colonial baggage also matters. I have recently been speaking to many African partners, and this point genuinely resonates with them.

Target: more than PLN 1bn in revenue

How large a company do you want to build over the next few years?

Within two years – in 2028 – we want to surpass PLN 1bn (EUR 233m) in revenue. I expect exports to account for around 40% of that by then. I do not want to make any commitments about what comes next, but our ambitions are significant.

How do you build a business like this in a mid-sized Polish city, far from the capital?

I see nothing but advantages in it. Growing a business requires getting the fundamentals right and staying focused, while in Warsaw it is easy to get distracted. You can easily get caught up in a whirlwind of meetings lasting several days.

We do not need the capital. Silesia is a very good place to grow a company. We have good road infrastructure, access to workers and easy access to Czechia. It takes me 45 minutes to get to our branch in Ostrava.

Global corporations are headquartered in Warsaw. Yet many of the Polish companies driving the economy operate from cities such as Zabrze.

And what makes international expansion difficult?

There is no single formula for success. Entering each new market involves risk. We have made plenty of mistakes and learned from them.

For example, we have learned that the best approach is to combine local knowledge with the best practices developed over many years at headquarters. In the past, we relied too heavily on local teams and put our own know-how on the back burner.

Sponsoring Górnik Zabrze FC as a childhood dream come true

You mentioned earlier diversifying the family’s wealth. Are the properties owned by TP Silesia part of that? Mercator is building a third business line in the residential property market.

That was a one-off investment in a complex of three office and warehouse buildings. We have no plans to become more involved in real estate.

And is expanding your cooperation with Górnik Zabrze FC an investment, or the fulfillment of a lifelong dream for a devoted fan?

It is more about fulfilling a dream. Given the nature of our business, it will not translate into new contracts. But I am a huge Górnik Zabrze FC fan, and most of our employees support the club too. We therefore see our financial support for the club as a way of contributing to the local community.

More and more Polish entrepreneurs are taking ownership stakes in football clubs. Can you see yourself doing the same? Presumably not at Górnik Zabrze, at least for now, following its acquisition by Lukas Podolski.

We withdrew from the process of acquiring Górnik once we saw that it was going to end up in good hands. Besides, getting involved with a football club can consume you, and I still want to achieve a great deal in business.

I am happy with the decision. We are one of the club’s biggest sponsors. I attend every match, while in my day-to-day work I can focus fully on growing the company. That role suits me. Górnik has the right owner, and investing in any other football club is out of the question.

A PLN 10m-plus investment in venture capital

In recent years, you have also started investing in startups. For an industrialist and trader focused on cash flow, EBITDA and the like, isn’t the world of new technology – driven largely by a vision of changing the established order – rather distant?

You summed it up well. That is indeed the case. I became interested in investing in startups, mainly medtech companies, after the pandemic. It can be very rewarding financially, but also very frustrating.

I analyzed dozens of companies and selected a few to invest in. I became most heavily involved in SiDLY. I am proud to see that since then its revenue has grown from PLN 2m (EUR 470,000) to more than PLN 20m (EUR 4.7m), and that the company has become Poland’s leader in telemedicine for senior care.

I have invested more than PLN 10m (EUR 2.3m) in the venture-capital sector. For the past two years, I have limited myself to supporting the AIP Seed fund. This allows me to focus fully on my own business.

What is the Polish VC sector missing?

It is a never-ending debate. Startups aspiring to become unicorns [companies valued at more than USD 1bn – ed.] need to prepare their products for international expansion from day one. But not every company has to follow that path. Many technology companies can successfully focus on the Polish market.

An obvious constraint is the much more limited access to capital than in Western Europe, let alone the US. Startup founders have no control over that. What they can do is strike a balance between big ambitions and financial discipline. They should place greater emphasis on using their first funding round efficiently. Even a large amount of capital can easily be squandered. If a company fails to meet its targets, raising another round may prove impossible.

So do you feel more at home as an entrepreneur than as an investor?

Definitely. The past few years have reinforced my conviction that I want to focus entirely on growing Zarys. I have tried different things, and I know that this is where I feel most at home.

Key Takeaways

1. Pandemic windfall funded further growth. In 2020, Zarys’s revenue rose from PLN 200m (EUR 47m) to more than PLN 850m (EUR 198m), while net profit increased from PLN 8m (EUR 1.9m) to more than PLN 270m (EUR 63m). The company invested most of its extraordinary gains in growth, including working capital, exports, infrastructure and headcount. As a result, it has continued to increase sales volumes even after the pandemic.
2. From Zabrze to Western Europe. During the pandemic, around 90% of Zarys’s revenue still came from Poland. By 2028, when sales are expected to exceed PLN 1bn (EUR 233m), exports are projected to account for around 40% of revenue. The company plans to step up its expansion in Germany, France, Italy and Spain, developing both relationships with distributors and its own local operations.
3. Zarys remains a family business. Despite interest from private-equity funds and strategic investors, the owners have no plans to sell the business or take it public. Paweł Ossowski wants to focus on building a European medical-products manufacturer and distributor, while his experience in venture capital is now a secondary chapter in his career.