Western brands pulled out of Russia, but their goods haven't

 



Western brands may have left Russia following its invasion of Ukraine, but their goods have not.

Trucks carrying Coca-Cola roll across the border into Russia, tourists return from abroad laden with Zara's latest designs, and local online marketplaces snap up IKEA's furniture stocks.

Despite European, North American and Japanese companies exiting Russia over its actions in Ukraine, the impact on Russian consumers is minimal, although delivery times can be longer and some goods are more expensive.

The main change has been supply routes, but products remain available both online and in stores. Buyers just need to know where to look.

Crucially, the vast majority of goods concerned are not subject to sanctions and these cross-border flows are legal. And Moscow is happy to let them in, whatever route they take.

Brands' continued availability shows the challenge companies face in controlling supply chains when exiting a market.

Zara in Minsk

Zara-owner Inditex shuttered its 502 Russian stores after Moscow sent troops into Ukraine, and then sold them to the United Arab Emirates-based Daher Group.

Now, small-scale imports and online sellers are keeping them alive, a Reuters review of six major online marketplaces and conversations with a dozen buyers and sellers showed.

Albina, 32, took an empty suitcase to Minsk last summer and returned 24 hours later with 33,000 roubles ($442) worth of Inditex-brand Zara, Bershka and Massimo Dutti clothes for herself and friends.

While most Western brands that have halted Russian operations have also pulled out of Belarus – a staunch Moscow ally – Inditex has not. The company did not respond when asked about this.

Albina told Reuters she has also bought clothes in Paris and Dubai and used a network of online sellers.

"There are pages on Instagram, on Telegram, there are girls I know who moved to live in Europe or Istanbul or Dubai. They collect orders, let's say in Istanbul, they take 15%-30% (as commission), then get them delivered here and you pay for the delivery," she said.

Last year's strong rouble and weak Turkish lira played into Russian consumers' hands.

Currency dynamics were partly responsible for a seven-fold increase in deliveries from Türkiye on CDEK Forward, a delivery service from foreign e-commerce sites, its marketing director Dinara Ismailova told Reuters.

"As soon as brands said they were leaving, some sort of panic kicked in, and the number of volumes and orders rose sharply," Ismailova said.

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