“Preparing to open.” Which foreign companies can return to Russia?

IKEA is looking to return to its operations in Russia and reopen its stores after adjusting its supply chain logistics to provide a full range of products. Viktor Yevtukhov, Deputy Minister of Industry and Trade, said the same applies to Inditex, which owns brands Zara, Oysho, Massimo Dutti, Uterque, Stradivarius, Pull & Bear, Bershka and others.

“To them [компании IKEA] It is important to fill in the assortment matrix, and now it is difficult for them to do so. It will open when the company finds a way out. Moreover, he established IKEA stores himself. Throwing them away, leaving them to someone is an ineffective move,” he said.

The Deputy Minister noted that IKEA has a “very good Russian market” and also has factories for production in Russia, although the company imports some of its products from other countries.

It was noted that foreign companies inspected by the Ministry of Industry and Trade temporarily suspended their activities not because of a special operation, but because of existing logistics and product supply problems.

“They plan to continue operations for the foreseeable future. They don’t want to leave because the Russian market is big,” he said.

According to him, the same goes for Inditex. “Russian market is important”.

“One of the shops in Moscow <...> It earned the largest revenue from the sale of Zara products in Europe. Of course they want to return to our market. But if they don’t, actually, maybe there’s a plus to that. It is not possible, but it is certain, because great opportunities are opening up for our manufacturers, we have very good initiatives in the light industry.”

What do they say at IKEA and Inditex?

IKEA has decided to temporarily stop working in Russia on March 3. The company explained that the conflict in Ukraine has led to a break in their supply chain. There were 17 stores and 8 studios operating under the IKEA brand in Russia.

The company has already commented on the words of Viktor Evtukhov.

“On March 3, IKEA and Ingka Group decided to suspend IKEA activities in Russia, this decision remains in effect”,

Inter IKEA Group spokesperson Romina Benfatto said in an email to Swedish newspaper Aftonbladet:

Spanish store chain Inditex also announced the suspension of work on the territory of the Russian Federation in early March. The Russian market accounts for about 8.5% of the company’s global profits and is the 502 stores of the Inditex group operating in the country. The decision to cease operations was also explained by the fact that the company could not guarantee the continuity of its commercial activities.

April 20 Inditex network manager Oscar Garcia Maceiras declarationHe said the company expects to continue operations in Russia whenever possible. However, he noted that the company’s position on the suspension of activities in the Russian market “remains the same” for the time being, and the holding’s management “continues to monitor the situation in Ukraine.”

Opening of OBI store

Employees of OBI hypermarkets were informed about the possible resumption of the work of the stores in the next week or two, the manager of the trading floor of one of the chain stores told socialbites.ca.

“We are getting ready to open. We were told that we can open in late April or early May. OBI will be the first to continue working at the Khodynka field in Moscow,” he said.

At first, only one of the Russian stores will open in test mode, and if everything goes well, other stores in Moscow and other Russian cities will continue to work.

At the same time, the store was not replenished with goods. “What and how much happened at the time of closing on March 17, everything remained the same,” the manager said. It also does not know what will happen to the suppliers of the trade network.

The interlocutor of socialbites.ca said that at the opening, sales are not planned and the delivery of goods will temporarily not work, as well as the ability to order remotely.

“We come to work every day, we get paid,” the manager said. – Employees at IKEA have been sent home and we have to go to work. But they pay almost the entire salary, not two-thirds.

On April 12, French media, citing their sources at OBI, reported that all the company’s structures in Russia were transferred to a new owner, on the condition that the OBI brand is no longer used in the country. OBI has a total of 27 stores and 4.9 thousand employees in Russia.

Continental tire production resumed

Previously, the German tire manufacturer Continental resumed the production of tires for passenger cars at a plant in Kaluga. The company told Reuters it was done to protect workers. About 1.3 thousand people work for Continental in Russia.

“Our employees and managers will face serious criminal consequences if we fail to meet local demand,” Continental said in a statement.

At the same time, the company resumed production of civilian products only.

On March 8, Continental announced its decision to suspend tire production in Russia. The company also stopped export and import deliveries. Other big tire manufacturers, especially Michelin, Bridgestone and Yokohama, announced that the works in the Russian Federation were stopped.

Companies continue to pay their employees

According to the Financial Times previously reported, foreign companies that suspended their work in Russia as a result of a special operation in Ukraine continue to pay the salaries of approximately 200,000 employees.

broadcast, at least 188,000 Russian employees multinational companies still get paid. The FT emphasizes that the actual number of such workers may be even higher, as all firms that have announced their departure from Russia did not specify whether they would continue to pay their subordinates. In addition, some international companies have begun to transfer their Russian employees to representative offices in other countries.

The publication also drew attention to possible risks for employees of foreign companies that suspend their activities in Russia. it is noted that the situation regarding the payment of salaries may become more difficult due to the lack of the necessary volume of ruble reserves, as well as Western restrictions on the use of the dollar in Russia.

Earlier, Moscow Mayor Sergei Sobyanin said on the subject: 200,000 people may lose their jobs in the capital due to the withdrawal or cessation of operations of foreign companies. It also announced support measures for citizens and businesses.

Viktor Evtukhov, Deputy Minister of Industry and Trade of the Russian Federation, said that IKEA and Inditex are considering options to reopen their stores in Russia. According to him, the suspension of activities of foreign companies is mainly due to problems with logistics and product supply, and the Russian market is important for these organizations. The OBI network also informed socialbites.ca about possible rework in the near future. IKEA told Swedish media that the decision to suspend the operation of stores in the Russian Federation “remains in force”.



Source: Gazeta

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