MOSCOW: Retail sales turnover in Russia reached 16.4 trillion roubles (US$556.5 billion) in 2010, according to the Russian State Statistics Service Rosstat.
The share of foodstuff, including beverages and tobacco, accounted for 7.1 trillion roubles (US$239 billion) and non-foods amounted to 9.3 trillion roubles (US$317.5 billion).
The retail food market is growing at 13 percent, which is more than twice the rate of Russia’s economy as a whole, and leading retailers are seeing growth rates of 30 to 40 percent. Between 2002 and 2009 food retail in Russia grew by 22 percent.
As Russia emerges from the recession, more and more hyper- and supermarkets open, while food prices continue to rise.
According to Rosstat food prices rose 12.9 percent in 2010 and 1.4 percent in January 2011.
Russians spend roughly 30 percent of their disposable income on food (for comparison, Americans spend less than 10 percent) and The Moscow Times speculates that the government will impose maximum prices for some foods, including potatoes and other fruit and vegetables.
Rising prices are the main driver for food retail growth in Russia. “No matter what, people will always buy food”, said Tigran Hovhannisyan, a retail analyst at UralSib bank.
The X5 Retail Group, Russia’s largest food retailer, recorded a net revenue of 341.6 billion roubles (US$11.2 billion) for 2010. Magnit, the supermarket chain with the greatest geographic coverage, earned 7.1 billion roubles (US$241 million) for the same period.
For the current year, X5 plans to open 540 new stores all over the country, while Magnit is to open 800 convenience stores and 55 hypermarkets. Discount chain Dixy has announced plans to open 150 new convenience stores.
This expansion builds on last year's boom, in which X5 added 1,097 new stores, including 660 stores via its acquisition of competitor Kopeika.
Magnit opened 827 stores, compared with 646 openings in 2009. Dixy had 646 stores open in the end of 2010, up from 623 open the previous year.
Food retail group Sedmoi Kontinent operated 146 stores at the end of the year, mostly in the Moscow region, compared with 139 a year earlier.
This brings the total number of big retail chain outlets to 7,439 throughout Russia, or 19,000 people per supermarket.
However, the Moscow Times reports the market is highly fragmented, with none of the major players having more than 4 percent share.
According to the newspaper, Russia’s ten largest food retailers hold about 11 percent of the market.
French Auchan SA, which has more than 30 hypermarkets in Russia, and German Metro Group, which operates 90 stores in the country, are the only foreign-owned food retail chains in Russia.
Sources: www.pmrpublications.com, www.themoscowtimes.com
