Rebecca Rayner, managing director of Glebe Farm Foods, reports from September's trade development visit to Russia by Food From Britain. Glebe Farm Foods produces organic flours and wheat, wheat-free and gluten-free bread and cake mixes
I had heard a lot about the Food From Britain (FFB) trade development visits (or TDVs to those in the know!) from industry colleagues so when the opportunity arose to go to Russia with the organisation, I jumped at the chance.
I’ve always been curious about the Russian market and the opportunities it presents from a retail point of view and it certainly hasn’t disappointed so far. The whole experience has been a real eye-opener for me and I hope that, via this article, I can share some of my personal insights with you.
Monday 15 September
We arrived in Moscow today – exhausted from a day’s travelling but excited about the next few days. Fortunately, FFB had arranged for us to eat at an Uzbekistani restaurant in the evening – a great way to wind down, meet others on the trip and introduce us to some rather interesting delicacies!
Tuesday 16 September
Up early this morning to prepare for the busiest day of the trip – store visits to a variety of Russian retailers (discount, middle-weight and premium) as well as the showcase and evening networking event with key industry players at the British Embassy.
First stop was one of the low-cost hypermarkets – Auchan (yes, the well-known French retailer) – to find out what makes this store tick! Surprised that there was a niche for this famous French conglomerate, we were told that the supermarket is the cheapest out there, undercutting Russian retailers by a good 10%. Style-wise it was much as you would expect – huge space, same layout as in Europe, pallets all over the place – but the product selection was a revelation.
For such a large country, there was a huge amount of imported food – the domestic offering was somewhat pitiful in comparison. Apart from a few basics, products from the likes of France, Germany and Austria seemed to be the most popular. But any company that is involved in confectionery could be on to a winner in Russia. We were completely flabbergasted by the selection of sweets, chocolate, biscuits and cakes. Even though they are expensive compared to other foods, they are big business over here and certainly an opportunity for anyone involved in the industry.
The ethnic sector is, by comparison, very poorly served. Only one variety of chutney and one mild curry was found. There was a small selection of Japanese food but that just about summed up the section.
Although my previous comments would suggest the opposite, I have to say that Russian consumers strike me as pretty adventurous in their tastes and this was confirmed by the different buyers we met during the visit. Apparently they are very open-minded when it comes to food and this is reflected in the amount of money they are prepared to shell-out on their groceries – on average a massive 50% of their monthly salary. And with pay cheques on the increase plus relatively low mortgage costs, there is a great opportunity to cater to the increasingly exotic and expensive Russian taste buds.
The next highlight of the day was a visit to the ‘Harvey Nicks’ of the Russian retail world, ‘Globus Gourmet. Located in central Moscow, this premium retailer was a real ‘foodies’ paradise. It offered serious high-end treats as well as delicious fresh fruit and vegetables, luxury ready meals and as many different types of bottled water as you can shake a stick at.
I was personally interested in the selection of bread mixes and flours on offer, particularly in the ‘free-from’ category, and was surprised to see that this is a relatively underdeveloped area. The only product was a ‘sugar-free’ mix and there was nothing to cater for those with gluten allergies – a great opportunity for us a couple of years down the line! Similarly, the wholefoods sector was poorly catered for, with some dried fruit and nut products to choose from. On the flipside, we noticed specifically that there was huge opportunity in the bottled water sector, with a whole array of international products on display; however, the focus was leaning more towards still rather than sparkling varieties.
Once we had all spent time touring the stores, investigating our own specific areas of interest, it was back to the hotel for a quick change and then out again to a glamorous evening reception at the British Embassy in Moscow. This was a fantastic event from a networking perspective and gave us the chance to socialise with other TDV’ers and key Russian retail industry figures as well as showcase our products to a range of interested buyers – all the while sipping cocktails in a beautiful setting in the heart of one of the world’s most breathtaking capital cities.
Overall, the visit – although very fast-paced – was highly interesting, informative and useful from a future business development point of view. I hope that some of the insights I gleaned along the way will be useful to anyone looking to branch out into the Russian retail market.
Read part two
Read part three