“Most dynamic market”

The fifth Business Forum held at the end of May in Moscow as part of DIY & Household Retail 2011 met with a good response. Information from the organisers B2B Conference Group indicates that the participants included 375 delegates from the industry, with representatives of retail companies such as Baucenter, Castorama, K-rauta, Leroy Merlin, Metrika, Obi, Starik Khottabych and Trest. During the two-day congress more than 50 speakers conveyed information in the shape of presentations and panel discussions. For the first time a special programme was set up to allow for individual purchasing discussions between suppliers and 24 retailers. The event was staged in a markedly positive industry environment. For the Russian DIY market seems to have overcome the financial crisis and is now recording strong growth. The sales figures of major retailers have again seen double-digit growth during this current year. Alexey Iovlev, CEO of Metrika, a domestic retailer, mentioned his company’s growth rate of 30 per cent at a media briefing on the fringes of the conference. Grigory Skotnitsky, a member of the Baucenter board, put the chains’s rate of growth at 30 per cent and Obi, a German DIY retailer, is said by its commercial director Evgeny Movchan to be expanding in double digits. Pekka Salmi, country manager of Fiskars, a manufacturer of garden tools, estimates the growth rates of the market as a whole at between 15 and 25 per cent. John Herbert, general secretary of the European DIY association EDRA, called this the “most dynamic and exciting market in the world”. The figures may be slightly over-optimistic when compared with other data. Certainly there are no accurate market statistics – which is only one of the difficulties that both manufacturers and retailers have to contend with, as revealed through the enthusiastic discussions at the congress. It is still the case that modern trading formats do not yet account for the greatest share of the retail volume. Russian consumers are happy to purchase goods for renovating their apartments and houses in the so-called open markets, where street vendors have their stalls. That, by the way, marks another difference from west European stores: DIY here has much less to do with fun, leisure pursuits and home improvement than with the sheer necessity of maintaining the fabric of the building. Whether the topic was private labels, the procurement policy of retailers in their home market, the logistical challenges in this…