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Spreading Cheer and Spending Cash
Posted on December 18th, 2009 Comments welcome Share/Save PrintSurvey indicates that Ukrainians’ New Year’s holiday spending will increase from last year, despite crisis.
by Adrian Erlinger, The PBN Company, Washington, DC
It would seem logical that the past 12 months of gruesome financial conditions (13% GDP contraction and 13% inflation) would force Ukrainians to economize. But according to an annual survey of European holiday consumer trends released by Deloitte, a consultancy, the average Ukrainian plans to spend 2,500 hryvnias ($313) on New Year’s revelry — 300 hryvnias more than last year.
While two-thirds of Ukrainian citizens complain that the economic downturn has affected their personal financial situation, up from 50% last year, Ukrainians will spend an average of 1,250 hryvnias on gifts. Approximately 53% of Ukrainians will do their shopping during the holidays – when prices reach their peak. Still, the majority of Ukrainians remain budget conscious and 10% of those surveyed will complete a New Year’s budget for the first time. Cash, computers and cosmetics ranked high on the wish list, says Komsomolskaya Pravda v Ukraine. With 2010 as the Year of the Tiger, orders of feline statuettes are in roaring demand.
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Continuing to Break New Ground … A Solid Foundation For Kazakh Retail?
Posted on August 18th, 2009 Comments welcome Share/Save Print
By Yekaterina Syrtsova, Associate Account Manager, The PBN Company, Almaty
Kazakh and western retail companies are pushing ahead with expansion plans despite the crisis.
Earlier this month Metro Cash & Carry, the German retailer, laid the foundation stone for its first supermarket in Astana and announced plans to build 10-15 stores in Kazakhstan. Arzan, a big local market player, unveiled two shopping centers in Almaty last year, and Magnum Cash & Carry followed suit, promising to establish supermarkets across the country. In a further sign that the sector is undergoing a shakeup, at the start of 2009, the chain SM-market bought supermarket chain Gross.
According to research published in newspaper Panorama, the annual turnover of the Kazakh retail sector is $2.5 billion for food sales and $8 billion for other goods. This is leading economists to speculate about a possible ‘hand off’ within the economy, whereby consumer spending takes over from oil and metals as drivers of growth, or at least as a counterweight to recession.
Consumers may be able to play this sort of role in shaping Kazakhstan’s economy, but key issues must first be addressed. Logistics is a major problem, particularly the lack of distribution platforms and storage facilities, as Stephen Kreeger, Country Director for Metro Cash & Carry Kazakhstan, told Kapital. Andrey Revin, Finance and Business Development Director of Eurasia RED, a big local developer, also cites the lack of both quality selling space and local franchisers selling international brands.
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[Quote of the Week] “It is always better to have ten small Gazproms than one big one.”
Posted on July 17th, 2009 Comments welcome Share/Save Print“It is always better to have ten small Gazproms than one big one,” says Yevgeny Fyodorov, head of the Duma Committee for Economic Policies. He commented on a new bill restricting the purchase or lease of additional trade space from retailers with annual sales of more than 1 billion rubles ($31.21 million) or market share of more than 25% in Moscow, St Petersburg, or any given city district.
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Second-Hand Bonanza
Posted on April 22nd, 2009 Comments welcome Share/Save PrintBy Yekaterina Syrtsova, Associate Account Manager, The PBN Company, Almaty
Devaluation, recession, inflation and redundancy - today all these words are familiar to everyone. Almost all industries in Kazakhstan, from energy and metallurgy to food and services, are suffering in the current economic climate. However, there is one particular field that is more profitable than ever - second-hand shops.
Before the crisis, it was taboo to mention that one shopped at a second-hand store. Times, however, are changing. As Elena, a successful shop owner, points out to Svoboda Slova newspaper, instability works in favor of second-hand shop owners. Those people who used to turn their noses up at the smell of second-hand clothes are now turning them up at sky-high prices in regular stores.
The idea is not new, though. During Soviet times there were so-called “commission stores” where all sorts of used goods - ranging from clothes to furniture - were sold. That was the only way to get new clothing during those times of shortage. Then, during perestroika, sympathetic Western countries started sending humanitarian aid that ended up behind the counter.
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Psychoanalysis or Retail Therapy: (Not) Spending in the Crisis
Posted on April 16th, 2009 Comments welcome Share/Save PrintBy Galina Khatiashvili, Intern, The PBN Company, Moscow
One of my friends jokes that during the crisis she is “investing” her money in psychoanalysis. Whether this is because of the greater stress or because of the plummeting price of therapy, I’m not sure. But the financial crisis is prompting all of my friends to make different choices and sacrifices.
My generation has a complex about money. The Soviet legacy means we are hardwired to scrimp and save, but we spent our teenage years during the profligate consumer boom. Now, during the crisis, the unconscious desire to economize has come to the fore.
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Dollar Stores, Pound Shops…and Tenge Markets
Posted on April 15th, 2009 Comments welcome Share/Save PrintIn past years, Kazakh consumers have flocked to the sleek, modern format retailers opening across the country. With the onset of the financial crisis, however, the growth rate of country’s retail sector has started decreasing, and traditional open-air markets have gotten busier once again. There is, however, a growing middle ground emerging, competing with the markets for penny-pinching consumers: the discount retailers. Read more »
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