Retailers have to face endless bureaucratic procedures as these are just a pretext for officials to get bribed (Saltmarsh and Kramer, 2009).
For example, the Swedish company, IKEA is facing problems with its stores permits as the company refuses to bribe the safety inspectors (Meyer, 2011).
This case is further enforced by the research of EPFR Global of Cambridge, Massachusetts, which discovered that the reason Russia had less investment fund inflows compared to the other BRIC countries was largely due to their corrupted legal system.
Besides that, Russia’s Federal State Statistics Service (2011) showed that the retail trade turnover Russia has also increased from 3693,2 billion rubles in 2009 to 4191,0 rubles in 2010 proving that the retail market there is very profitable. Social The sociocultural factors on the other hand will consider the perceptions of Russian consumers in addition to their population growth, income distribution and living standards. According to the research carried out by Huddleston et al. (2011, pp. 179), Russians ‘do perceive differences in product quality based on country of origin’.
They perceived that products from Western marketers would be of higher quality compared to their local products. This is an advantage that the British retailers can capitalize on when introducing their brand into the Russian market. Russia may be the largest country in the world, but it also has a declining population with an amount of 145 million in 2003 reducing to 143. 5 in 2005, further reduced to 141. 9 in 2009 (Federal State Statistics Service, 2011).
The Essay on Russia: Country And People
Russia is also officially known as the Russian Federation. At 17 million square kilometers, Russia is the largest country in the world, covering more that one-eight of the Earth’s inhabited land area. Russia is also the world’s ninth most populous nation with 143 million people as of 2012. It is a country in northern Eurasia. From northwest to southeast, Russia shares borders with 14 countries, ...
Even so, BBC (2010) recently released that this long term trend of declining population may be coming to an end at last as the population has grew at last for the first time in 15 years.
The increase in population is a good sign as it means that there will also be an increase in consumers in the future. According to Euromonitor (2011), the annual gross income of 2011 in Russia is as much as US $1,078,551. 7 million and the annual disposable income increased from US $832,977. 1 million in 2010 to US $870,813. 1 million in 2011. Furthermore, the standard of living in Russia is improving with more and more Russians moving towards the middle class section leaving poverty behind (Smirnov, 2010).
With the increase in income and living standards, Russia is growing to be one of the largest consumer markets in Europe. Technology Lastly, technological factors in relation to the development and research will be touched on in this report. Russia has always been lagging behind in terms of technology and infrastructure. However they have begun to recognize the importance of technology development and plan to use their procurement budget in solving the problem (Kramer, 2010).
They have also sought the assistance of US companies who are prepared to invest in their infrastructure-related projects. The Voice of Russia, 2010) With the improvement of technology advancements and infrastructure especially in rural areas, it would be advantageous for British retailers to consider expanding in other parts of Russia instead of concentrating on Moscow. Conclusion In summary, all aspects except the political factor point to a favorable side of the Russian market. However, the British retailers should also consider that the Russian market is not easy to navigate as evident from the failures of past retailers like Wal-mart and Carrefour.
On the other hand, there are also retailers that have succeeded in penetrating this complicating market and reaped great rewards from there such as France’s Auchan and Germany’s Metro. In simple words, the Russian market full of opportunities and British retailers should expand with discretion. Reference List A. T. Kearney (2010) Global Expansion a Must for Retailers: A. T. Kearney Study [Online]. Retrieved from: http://www. atkearney. com/index. php/News-media/global-expansion-a-must-for-ret
The Research paper on Retail Operation Information Technology
This paper presents the applications of Information Technology in retailing. The retail market is a state of exponential growth. Retailing includes all the activities involved in selling goods or services for the final consumer. These activities include demand and sales forecasting, inventory management, store management, transportation etc. This paper focused on how Information Technology may be ...
