The Clothing Retail Market in Russia
The clothing retail market in Russia is estimated to have been worth Rb1.05 trn (US$35 bn) in 2010—1% more than in the previous year. The increase followed a 9% fall in 2009, from Rb1.1 trn to Rb1.03 trn, which resulted from the global economic downturn. In the first half of 2011, the market stagnated but in 2011 as a whole it is expected to grow by 3-5%. Moreover, there remains a great deal of potential within the Russian market as a number of sectors are strong and are forecast to grow in the upcoming years.
Women’s clothing has the largest share with 55% of the clothing market in value terms, but men’s clothing is the most promising sector with annual growth expected to be about 10% per annum. Even in 2009—which was the most difficult year for the industry—this sector continued to grow. One of the major features of the Russian clothing retail market is its low concentration. There are about 200 domestic and international clothing brands with a presence in the Russian clothing retail market and the shares of even the largest domestic brands remain insignificant.
In recent years, leading international clothing brands have been able to put competitive pressure on local players and gain a significant share of the Russian clothing retail market. As a result, the retail market remains very attractive for foreign investors—especially those willing to expand into the vast undeveloped regions outside the major cities. However, brands planning to expand independently into the Russian market could encounter serious problems—not least the high levels of corruption and bureaucracy in the country.
In an attempt to strengthen domestic producers and help them to compete with clothing imports, the Russian government has formed a Strategy for Development of Light Industry of Russia until 2020. However, the strategy also addresses a number of other serious issues—such as the large share of counterfeit clothing on the market.
Women’s clothing has the largest share with 55% of the clothing market in value terms, but men’s clothing is the most promising sector with annual growth expected to be about 10% per annum. Even in 2009—which was the most difficult year for the industry—this sector continued to grow. One of the major features of the Russian clothing retail market is its low concentration. There are about 200 domestic and international clothing brands with a presence in the Russian clothing retail market and the shares of even the largest domestic brands remain insignificant.
In recent years, leading international clothing brands have been able to put competitive pressure on local players and gain a significant share of the Russian clothing retail market. As a result, the retail market remains very attractive for foreign investors—especially those willing to expand into the vast undeveloped regions outside the major cities. However, brands planning to expand independently into the Russian market could encounter serious problems—not least the high levels of corruption and bureaucracy in the country.
In an attempt to strengthen domestic producers and help them to compete with clothing imports, the Russian government has formed a Strategy for Development of Light Industry of Russia until 2020. However, the strategy also addresses a number of other serious issues—such as the large share of counterfeit clothing on the market.
SUMMARY
INTRODUCTION
DEVELOPMENT OF THE CLOTHING RETAIL MARKET IN RUSSIA
Soviet era
Post-Soviet era
STRUCTURE OF THE CLOTHING RETAIL MARKET IN RUSSIA
Women’s clothing
Men’s clothing
Children’s clothing
Work clothing
Underwear
Sportswear
Low market concentration
RETAIL SALES OF CLOTHING IN RUSSIA BY REGION AND SALES FORMAT
CONSUMER PREFERENCES IN THE RUSSIAN CLOTHING RETAIL MARKET
Price segments: composition by source and brand
Source
Brands
BRANDS IN THE RUSSIAN CLOTHING MARKET
Foreign brands
Shift away from franchising to direct selling
Russian brands
COMPETITIVENESS OF DOMESTIC PRODUCERS
IMPORTS
Leading suppliers of Russian clothing imports
EXPORTS
POTENTIAL PROBLEMS FOR COMPANIES ENTERING AND
EXPANDING IN THE RUSSIAN MARKET
COUNTERFEIT TRADE
OUTLOOK
Prospects for market growth
Store format
Geographical location
Most promising sectors
Will domestic production make a comeback?
Counterfeit and contraband products
INTRODUCTION
DEVELOPMENT OF THE CLOTHING RETAIL MARKET IN RUSSIA
Soviet era
Post-Soviet era
STRUCTURE OF THE CLOTHING RETAIL MARKET IN RUSSIA
Women’s clothing
Men’s clothing
Children’s clothing
Work clothing
Underwear
Sportswear
Low market concentration
RETAIL SALES OF CLOTHING IN RUSSIA BY REGION AND SALES FORMAT
CONSUMER PREFERENCES IN THE RUSSIAN CLOTHING RETAIL MARKET
Price segments: composition by source and brand
Source
Brands
BRANDS IN THE RUSSIAN CLOTHING MARKET
Foreign brands
Shift away from franchising to direct selling
Russian brands
COMPETITIVENESS OF DOMESTIC PRODUCERS
IMPORTS
Leading suppliers of Russian clothing imports
EXPORTS
POTENTIAL PROBLEMS FOR COMPANIES ENTERING AND
EXPANDING IN THE RUSSIAN MARKET
COUNTERFEIT TRADE
OUTLOOK
Prospects for market growth
Store format
Geographical location
Most promising sectors
Will domestic production make a comeback?
Counterfeit and contraband products
