Still room for expansion upward

In 2013 foreign DIY retailers had a share of more than 20 per cent in the Russian DIY market, which they continue to regard as a key market. Nevertheless, as pointed out by industry experts at Infoline, a market research company, the pace of growth of investments by the global players in Russia has slowed down in recent years: while the increase of DIY retail space still amounted to 17 per cent in 2010, it fell to 14 per cent in 2011 and even down to 8.5 per cent in 2012. Ivan Fedyakov, director general of Infoline, believes that “the biggest international operators are currently failing to realise their full potential in the Russian market.” He foresees continuing growth for the Russian market in the next few years and believes it will be one of the most interesting in Europe. “But the foreign operators are being confronted with a situation where many practices that are followed with success in the West are not proving acceptable under Russian market conditions.” For instance, he is of the opinion that the greater part of the cost of logistics is borne by the suppliers, whereas that is mainly the responsibility of the retail chains themselves in Russia. What is more, there are serious difficulties when it comes to the search for qualified personnel.