Russian designers and brands are helping the retail sector gradually recover from 15 months of turmoil in which stores closed and demand fell, as new brands filled the gap left by foreign rivals and shoppers shyed away.
Hundreds of foreign retailers have closed shops in response to the sending of Russian troops to Ukraine in February 2022, leaving some of Moscow’s most prestigious streets boarded up and the industry reeling from an estimated 2.5 billion hit of dollars.
Russians’ access to Western products is decreasing
The Spanish company Inditex has sold part of its more than 500 stores in Russia to a buyer from the United Arab Emirates. Its Zara flagship store in central Moscow, which had been unused for over a year, reopened last month under new management and a new brand, MAAG, leaving customers largely satisfied.
“It seems nothing has changed since you know who was here,” said Anton, a resident of Moscow, according to Reuters.
Antonina, for her part, declared in front of the store that: “I didn’t find any difference apart from the variety of choice. There’s less of everything right now.”
Retail sales, a key indicator of consumer demand, collapsed in 2022, hit by soaring inflation and falling wages, while an exodus of Westerners contributed to heavy losses in the industry, said Oleg Klimov, chairman of the Council of Shopping Centers from Russia, and logistics and payment issues take months to resolve.
Russians’ access to Western products like McDonald’s hamburgers and Levi’s jeans — symbols of the kind of freedom capitalism could offer with the collapse of the Soviet Union — is shrinking.
Gloria Jeans, once a reseller of Levi’s jeans, has taken over the central Moscow store of Swedish retailer H&M.
Another problem is the lack of staff – seamstresses and textile professionals. Russians have developed solutions with small-scale imports and online sellers that help keep foreign brands alive, but some things remain hard to find.
To compensate for these shortcomings, many Russians go shopping in Kazakhstan.
