Fashion retailers expect massive foreign expansion on Russian market
MOSCOW. Dec 14 (Interfax) - Fashion retailers are expecting a massive expansion into the Russian market by foreign brands over the next few years.
The next few years will see an influx by "everyone who has not yet managed to come year, because our market is still solvent, still interesting, although also very difficult," the retail director of Jeans Symphony, Yevgeny Lavrov said at a Fashion Retail Russia press conference on Thursday.
He said international chains are paying increasingly more attention to Russia because Europe and the United States "are in a fairly serious slump." And they are prepared to enter the Russian market despite its "specific" difficulties. "We have many of our own specifics such as rent rates, retail with management and staff who are not quite ready for this," Lavrov said.
Local retailers could benefit from being neighbors with foreign brands due to generation of more traffic, the co-owner of the Vesch chain, Vladimir Terziyev believes. A British Debenhams that opened next to a Vesch store increased traffic at the latter, although not for long. "At the start this led to a 20% increase in traffic in our store," Terziyev said.
"On the other hand, there are our regions, which account for about 80% of sales in our industry. The grandees of the global market will, of course, arrive there with time, but they will still arrive after local players," Terziyev said.
About 50% of Vesch's 46 stores are in the regions, and the others are in Moscow. "There regions are currently considerably more attractive," Terziyev said.
The company opened six new outlets this year and plans to open about 10 stores in 2013, focusing "more on the regions."
Terziyev also said the retailer is considering launching a second chain, the name of which he did not disclose. "Perhaps, if everything goes alright, we'll open the first stores at the beginning of next year," he said, adding that the new brand will be largely focused on youth fashion.
Retailer Baon plans to open at least 40 stores "in all regions" next year, co-owner Ilya Yaroshenko said. The chain now has 120 stores, including 70 franchises. It opened eight company-owned and 17 franchise stores this year, and another three franchise outlets will open in December.
