Retail and leisure
Russia has a growing client base in retail and clothing.
It's important to note, supermarkets do not sell clothing, and there are not mid-market clothing chains in Russia, except for those selling clothing for young children. In Western Europe, these mid-market chains are high volume, competitively priced channels. As they do not exist in Russia, there is a large gap in the market for independent retailers.
The value end of the market is dominated by retailers selling in bazaars (open-air markets). These retailers and wholesalers tend to be from non-Russian ethnic groups and the clothing comes via imports from China, Vietnam, Pakistan, Bangladesh and India. It can be very hard to break into this end of the market because of the high level of interpersonal trust involved.
Retailers selling in indoor markets, are at the higher end of the low priced clothing market. This was where most people bought clothes in Soviet times, and now, they tend to sell former Soviet brands made in Russia and other countries of the former Soviet Union. In general, this distribution channel offers reasonable quality clothing at an affordable price. The clothing is not always high fashion, and the retailers also sell high priced items such as mink coats and suits. A few high street shops also fall into this market, as do most clothing shops in smaller towns.
Most high street shops are independent clothing shops, selling relatively fashionable clothing and branded wear. Brands with a good point of sale can do well in this part of the market. Retailers selling branded fashion also have shops in trading centres. Trading centres are privately operated, multiple units that are similar to an indoor market but smaller than a shopping centre.
Brands from around the world have shops at new shopping centres. As they are very successful, this channel is growing and more are being built.
The large number of independent retailers in Russia means that wholesale distributors are generally the key to the market place. There are no national wholesalers in Russia, and they operate on a regional basis, selling to hundreds of stores in a particular area. Importers who sell nationally, sell their products to multiple wholesalers across the country.
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