The Russian Fashion Retail Market - Igedo Company

claims that the environmental disaster will Russia push back by several months in
its attempt to overcome the global economic and financial crisis. His opinion is
shared by experts saying that the economic recovery will be delayed because
higher cost for anything related to food, energy supplies and telecommunication
will be put on the shoulders of the public, beginning in autumn of this year.
1.8. European clothing suppliers to Russia cut losses by half
September 2010, European Fashion and Textile Export Council (EFTEC)
Exports of textile apparel and accessories from the 27 member states of the
European Union to Russia kept declining by 15 per cent over the first six months
of this year reaching an ex factory value of € 0,958 mn. Last year shipments had
to face a decline of 29 per cent representing a total of € 2.1985,5 mn. This means
that European clothing suppliers to Russia were in a position to cut their losses
almost by half. Over the delivery period of the first quarter of 2010, clothing
exports from the EU to Russia saw a decrease of 20 per cent. The European
Fashion and Textile Export Council (EFTEC), monitoring export development of
European clothing to Russia on a quarterly basis for each member state and for 33
main product categories since 2002, expects a return from "red" to "black" export
figures after the first semester of 2011.
2) Consumer Characteristics
2.1. Consumer Demand up by 3,4 per cent over first semester 2010
September 2010, cisstat
Measured against officially registered retail trade turnover, consumer spending in
Russia at the points of sale rose by 1,3 per cent over the first quarter of 2010 and
by 3,4 per cent during the first semester of this year. From 2002 till 2007,over the
boom phase in Russia retail turnover rose at an average annual rate of 12 percent
The peak was reached in 2007 when retail turnover increased by 16 per cent
against the previous year. In 2008 growth declined to 13 per cent and in 2009
retail turnover plunged by an overall rate of 5,5 per cent. According to Anna
Lebsak-Kleimans, CEO of Fashion Consulting Group (FCG), retail turnover for
textile clothing and accessories reached a value of US $ 27,4 bn in 2008. In 2009
the retail market value declined by 8 per cent to US $ 25,4 bn less a balance of
US $ 2,7 bn for inventories of unsold merchandise. This reduction has brought the
clothing retail turnover to a suggested US $ 22,7 bn in 2009. FCG reckons with a
new growth emerging in 2010 of up to 4 per cent bringing the total to US $ 23,6
bn.
2.2. Real income rose by 13,4 per cent until May 2010
3 rd Quarter 2010, The Global Blue Perspectives
According to the World Bank, Russia is experiencing a "bumpy" recovery.
Domestic demand is on the rise and budget execution is better than anticipated
due to higher oil prices at around US $ 78 per barrel. This is much more than the
US $ 57 per barrel, planned by the Russian Ministry of Finance for this year's
budget. In May 2010 inflation was at 3,6 per cent and the real income of the
population increased by 6,2 per cent against the month before. During the first
five months of this year the average salary was up by 13,4 per cent in comparison
with the same period of last year. Employers in Moscow are getting more aware of
the necessity to increase wages and salaries to keep their workforce staying in
their companies.
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