Head of the Representative Office of RD Group in Russia Roman Tkachenko provided commentary to CRE Retail about the most recent initiative of the Russian Ministry of Industry and Trade to support small and medium-sized enterprises.
For the sake of supporting small and medium-sized enterprises, the Russian Ministry of Industry and Trade is considering the introduction of additional permits for developers to build or reconstruction major retail properties, like hypermarkets and retail centers.
Head of the Representative Office of RD Group in Russia Roman Tkachenko noted that in major Russian cities a consumer will use only 2-3 different retail formats whereas in the West a consumer is likely to use 5-6 formats. “The government should develop different retail formats: from the wholesale centers and hypermarkets to the small shops and neighborhood stores,” the expert said. “And then the competitive market itself will act as the regulator for the concentration of retail facilities in a given area. For example, hypermarkets are not accessible for everybody, since they are often far from metro stations or outside the city limits and can only be accessed by car.”
“It is important to take into consideration international experience, which shows that the presence of hypermarkets has a positive impact on the competitive environment: it stimulates the development of small and medium-sized business, the competitive struggle intensifies and thus prices are lowered,” Roman Tkachenko concludes.
Roman Tkachenko’s commentary can be found in the CRE Retail magazine issue No.20 for November 2014 in the News Rating column.