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Federal retail chains will continue their expansion to the Urals in 2022

Local Megamart hypermarkets will start operating under the Magnit brand this year: the federal company has acquired the holding, which includes the Ural retail chain. According to the Ministry of Agriculture and Consumer Market of the Sverdlovsk Region, in 2021, 244 new food retail outlets appeared in the region, and most of them belong to large chains. Thus, Magnit opened 80 new outlets in a year, Pyaterochka – 72, Monetka – 47, Verny – 17. How does this affect regional players?

Experts note that the grocery trade has been developing at a tremendous speed over the past five years, but the share of local players in this market has only been declining. Due to the expansion of federal retail chains (TS), Wright, Zvezdny, Piknik left the market, some held on, but not without losses. For example, out of 26 Elisey supermarkets in Yekaterinburg, less than ten are left, and some of the retail premises from the local chain are now rented by the federals.

– We calculated: during this period, the number of competitors within walking distance from our stores has doubled. This includes hard discounters and bakeries. So, the very first “Elisey” worked at the exit to the Chelyabinsk tract, but when large retailers entered the nearby villages, its revenue fell, and we rented out the site. We cannot compete with the federals, – states the owner Alexander Ogloblin.

Nevertheless, Elysee’s grocery stores, where they sell dishes produced by the kitchen factory, which he owns, are working quite successfully. In 2021, the entrepreneur began supplying finished products to other chains and online retailers.

– The Kirovsky stores (there are more than 160 of them in the region) have also managed to keep their positions, plus small retail facilities are preserved in small towns of the Urals. However, in the outback, consumer cooperation is mainly engaged in food trade, and it is important to support it, because federal players will not go to small settlements, ”says Vera Solovieva, director of the Institute of Management, Entrepreneurship and Engineering at USUE.

Despite the fact that international, federal and regional networks occupy more than half of the market in the Sverdlovsk region (54 percent), and regional and local ones account for 12 and 34 percent, respectively, Ural entrepreneurs believe that consumers can be attracted by local products. For example, the popularity of Zhiznmart healthy food stores is only growing, although recently it also has a competitor – Moscow’s VkusVill.

– There are about 150 manufacturers with whom we cooperate – this provides a resource for expanding their sales and our presence. In addition, training for store managers helps us compete with the feds. We take a person with experience in business and public catering, as a result, he has a completely different level of motivation and competence, – explains the director of franchising of the network Ksenia Lysenko.

Now there are 33 Zhiznmart stores in Yekaterinburg. The founders of the chain want to launch the franchise in other regions, starting from Tyumen. They are not afraid of a new strong player in their segment; on the contrary, they are confident that this will help the population switch to better food.

The largest chains consider the constant improvement of the quality of services to be their advantage. For example, by optimizing the format of large stores and launching additional digital services, checkpoints, they increase customer traffic, says Roza Timakova, a lecturer at the Department of Food Engineering at USUE.

The same Magnit plans to open compact superstores in the Urals in place of the current Megamarts. In terms of the number of stores, the retail chain of the federal brand is ahead of other players in the region – now it has 904 points, mainly of the “convenience store” format. By the way, the Ural hypermarkets will not be renamed in the municipalities where the share of “Magnit” will be more than 25 percent. However, the essence of this is unlikely to change, but formally the requirements of the Law “On Trade” will be observed. By the way, the Sverdlovsk OFAS notes that no violations of antimonopoly legislation were found in the region’s food market over the past year.

Direct speech

Svetlana Ostrovskaya, Deputy Minister of Agroindustrial Complex and Consumer Market of the Sverdlovsk Region:

– In order to increase the availability of products of regional producers, the ministry on an ongoing basis organizes trade and procurement sessions, where they conduct direct negotiations with representatives of retail chains. Large CUs are expanding their commodity matrix, including locally produced products. In January-October 2021, the retail trade turnover in the region amounted to 996.4 billion rubles. In actual prices, the growth amounted to 8.4 percent, in comparable prices – 1 percent.

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