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Russian retailers and mall-owners look at Turkey to replace existing Western brands

The Russian Council of Shopping Centers (RCSC), an umbrella organization representing developers, shopping center owners, and retail chain operators, has said it was negotiating with its corresponding representatives in Turkey, China, India, and Iran about finding alternatives to western brands.

"A list of foreign companies that have temporarily ceased operations in Russia was sent to them so that appropriate equivalents can be found," a statement on the RCSC website read on March 25.

"Over time this will help supplement or completely replace goods of the defunct brands with ones of a similar quality and design."

Dozens of big brands have suspended operations in Russia or exited the country since Moscow started a "special operation" to invade Ukrainian territories on Feb. 24.

During an RCSC meeting of more than 100 market participants, the challenges facing Russian retailers were discussed, according to local media reports.

RCSC cited Igor Maltinsky, director of development at Melon Fashion Group, as saying that the main challenge facing domestic retail firms was the uncontrollable growth of production costs, due to huge increases in procurement and logistics costs.

Melon owns four fashion brands - Zarina, Befree, Love Republic, and Sela - and had 846 stores across Russia and former Soviet republics at the end of 2021. It had been planning to hold an initial public offering (IPO) this year.

Western sanctions have hampered supply chains and triggered a panic buying among some Russians, with medicine and sugar shortages reported.

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