SHOPPING CENTERS TODAY RUSSIA | NOVEMBER 2018 | 54
International brands: price segment
How was international brands expansion
in 2017-2018?
• 524 brands has been presented as shops in Russia by the midyear 2018.
• 33 new international brands entered the Russian market in the reporting period H2 2017 – H2 2018.
• Profit margin for small international brands franchisees (with the exception of catering) remains low because of procurements in foreign currency accompanied by a weakened ruble. That creates obstacles to new international brands planning to enter Russia.
• A positive difference between shops opened and closed in noted after 3 years of stagnation. The international brands opened 235 more shops than they closed.
• Restaurants and cafes have been expanding in the highest pace.
• Economic welfare of cities and quality supply of the retail space continue to set the direction of development for international brands.
• Sochi was first time included in the TOP-10 list of Russian cities by presence of international brands.
• Global retailers expand actively in the cluster of cities with population 300-500K people.
• 5500 new international brands stores were opened in the past 4 years, nevertheless the net growth was only 220 stores due to the significant number of shops closed over the period mentioned.
Activity of international brands