Yekaterinburg retail food market has no niches available, claims Alexei Podolyako of Alliance Non-Commercial Partnership

6 February 2007 (09:00)

‘Yekaterinburg retail food market has no niches available at the moment; there is a notion that they do exist and can be occupied, but this is, in fact, a mere illusion,’ Alexei Podolyako, CEO of Alliance Non-Commercial Partnership, reported to UrBC.

‘The arrival on the local market is currently performed in the make-way-for-me format, so if any new player comes up, they have to fight to get a share of the market. However, if this player can boast some impressive competitive advantages and is capable of using them properly, they will find their place in the sun,’ Mr Podolyako explains.

‘Another reason why it’s wrong to speak of available market niches is the fact that the market saturation should be tied in with the income levels. Experts have been evaluating the market potential only by comparing the number of square meters covered by trade areas per capita with the European figures. Since the latter amount to twice the amount of local ones, they say our market definitely has potential. If one, however, takes into account the fact that our average income per capita is four times less than the European one, one should probably calculate the appropriate number of supermarkets on this basis as well. In this case, you could easily see that we have more than enough of them here in Yekaterinburg, and raising the number of grocery stores without the corresponding income growth can be quite risky.’

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