Filenews 14 April 2022
The sanctions imposed on Russia after its invasion of Ukraine have mobilized Russian retailers who are trying to cover up some of the increasing losses.
The first contacts began after the Russian Council of Shopping Centres (RCSC), an organization representing shopping mall owners and retail chain managers, announced that they would fill the gap created by the withdrawal from Russia of Western companies with companies from countries such as China, Turkey, India and Iran.
"Groups of investors are calling and asking to meet with us about the empty stores after the withdrawal of Western brands from Russia," Sinan Onzel, president of the Federation of United Brands (BMD), told the newspaper Hürriyet. "We are also planning to go to Russia in the coming days and clarify the details of the process," he added.
According to BMD data, 32 Turkish companies are currently operating in Russia, and the brands have a total of 655 stores and 2,500 points of sale. The experience that the Turkish business world has gained so far in Russia is very important, Onzel noted: "There is no risk for us to be in Russia at the moment. It's a market we know," he said.
"There is still a serious-scale spending going on in the country. Many Western companies have stopped operating, but the stores are actually full. We do not know under what conditions Turkish brands will accept instead of these shops. Previously, Turkish brands had left Russia due to high costs. I believe that the new conditions will be more favourable than the previous conditions," he added.
In the game and the Indians
Some Indian companies are also in talks to open stores in Russia. Home furniture retailer Maspar and Killer Jeans are among the retailers exploring franchise opportunities in Russia.
So far, four Indian brands have signed initial agreements with Russian companies, and another six are expected to come later this week, said Susil Durgaval, founder of retail consulting firm Beyond Squarefeet Advisory that facilitates cooperation talks with Russian companies.
Dozens of major brands, including MasterCard, Visa, Sephora, Louis Vuitton, Nivea, McDonald's, IKEA, Volkswagen, Google and Amazon, have temporarily suspended their operations or withdrew from the country since Russia sent tens of thousands of soldiers to invade Ukraine on February 24. According to research by the Yale School of Management, at least 253 brands operating in Russia until the start of the war decided to leave the country altogether. The same survey states that 323 brands announced that they have suspended their activities, while the number of companies in the country that announced that they will not make any new investments is 96, although 162 brands, on the other hand, continue their activities uninterruptedly.
Petros Kranias
Source: Capital.gr
