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Kyiv is losing food retailers

03 September 2015 | Thursday
URE Club

Ukrainian businessmen are getting rid of unprofitable assets. At least four food retail chains have already left Ukrainian market.

One of the largest quits is Smart-Holding Company, which belongs to Vadim Novinski a businessman from inner circle of the ex president of Ukraine. Mr. Novinski decided to stop expansion of its supermarket chain Amstor. The company has signed the agreement with other retailer Fozzy Group. According to the agreement the latter received all retail premises and started to reopen supermarkets under the brand Silpo.

Another businessman Anatoliy Yurkevych, who had also owned food retail chain, sold the business to DCH Real Estate.  Among others are supermarket chain Sheremetyevo, which used to include about 20 “neighborhood stores” and Bi-Market.  “We can’t receive money for the delivered goods – many of our experienced the same problems”, - says the director of one of the food-company suppliers, who wished to stay anonymous.

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One of the largest quits is Smart-Holding Company, which belongs to Vadim Novinski a businessmanfrom the circle of ex president of Ukraine. The company decided to stop expansionof its supermarket chain Amstor. Retailer has signed the agreement with other retailer Fozzy Group.According to the agreement the latter received all retail premises. It has already started to reopen supermarkets under the brand Silpo.

It’s worth mentioning that 18 out of 38 stores within ATO area are operated by ex partner of Vadym Novynsky. Smart Holding accuses businessmanof raider seizing part of commercial network.

The joint Ukrainian-German venture Marcom – the importing company of premium class alcohol, also abandoned one of its retail networks – Malenky Prints, which comprised three stores of premium segment. Previously, the retailer expressed the intention to open at least seven or eight outlets in the capital.

Businessman Anatoliy Yurkevych,who had also owned food retail chain, sold the business to DCH Real Estate.Among others are sold supermarket chain Sheremetyevo, which used to include about 20 “neighborhood stores”.

Another small retailer, Bi-market, closed about 20 its stores.

“We can’t receive money for the delivered goods – many of our experienced the same problems”, - says the director of one of the food-company suppliers, who wished to stay anonymous.

The main reason why majority of businessmen are getting rid of their businesses is obvious poor economic situation in the country. According to Deputy Head of the Supervisory Board of Pakko Holding (PAKKO and VOPAK chains) Oleg Mertschenko, during seven months of current year, sale volume has decreased by 10-15% compared to the same period of previous yearl. Consumers crossed over to low-cost products.According to owner of Tavria B and Kosmos retail chains Boris Muzalev at the bestwe can work for zero result. It is resulted from living standards decrease. According to the State Statistics Committee, in June, the real wages of Ukrainians decreased by 26.3% compared to the same month last year. Taking into account that by the end of the year the situation in the national economy is going to stay the same and the number of retailers willing to leave the market will keep on increasing.  According to forecasts of the Managing Partner of consulting company Retainet, Alexander Lanetsky it is likely the four major networks to beclosed by the end of this year. Many of them have to maintain foreign currency loans, which becomes more and more difficult each day.

Source: http://www.abcnews.com.ua


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