Fair retail

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Справедливый ритейл

A shopper in the produce section of the supermarket. Photo: Alexander Demyanchuk/TASS

 

MPs want to see Russian state trade network of food products

RP already mentioned that for efficient import substitution in the consumer market, the government should initiate the organization, including on the basis of state and/or municipal-private partnership, the trade networks by domestic producers.

At the same mark for the products of domestic manufacturers needs to be replaced with a trade discount, which minimizes the growth of prices and costs of trade. And trade of goods of local manufacturers must provide some social benefits to consumers of their products.

Here and in the state Duma want to see Russian state trade network of food products.

Member of state Duma Committee on Federal structure and local government Margarita Surganova (LDPR) sent an appeal to the Federal Minister of industry and trade Denis Manturov with a proposal to create a new trading network of food products, which will be 100% owned and managed by the state. The legislator noted that the emergence of such a national retailer to a certain extent, will help solve the problem with access of domestic products to the Russian buyers. At the same time trading network under the control of the state will be able to affect pricing in the country — this is especially important in light of the fact that major private retailers have been accused of price fixing and artificially inflating prices.

“The idea of public trade network aimed at addressing several problems. We have repeatedly raised the issue that domestic manufacturers is difficult to place their product on the shelves of major retailers. There is already a longstanding practice, when the players in the market charge for that particular product could be sold through them. State trading network will be able to work without such levies, and our manufacturers and farmers will get the opportunity to finally properly get to customers, — the Deputy noted. — On the other hand, a state network is a good instrument to fight price fixing and undue price increases, which allow for private networks. We can use it to keep the prices at the correct level, and the other players will not be able to inflate the prices. Then the buyers of them just go”.

Previously Deputy Margarita Surganova has prepared a draft law on amendments to the Federal law “On fundamentals of state regulation of trade activity in Russian Federation” aimed at protecting producers. Today really there is a practice in which private trading network put in front of local producers or farmers exorbitant amounts that they must pay in order to get the opportunity to place their products on the shelves. This reality leads not only to automatically increase retail prices for products, but also to artificial inhibition of the import substitution policy.

Russian consumers after the introduction of the food embargo in the summer of 2014, I expected the place foreign goods on the shelves of Russian stores and hypermarkets is domestic. But despite all these expectations and assurances of the authorities that our agricultural sector is being actively developed and can feed everyone, buyers began to notice: instead of some foreign goods on the shelves began to appear other, for example from China or Iran. In such circumstances, all the talk about import substitution are more surprising.

 

A new trading network focused on the promotion of domestic goods, would to some extent solve this problem.

Справедливый ритейл

In the hypermarket “Auchan”. Photo: Interpress/Sergey Konkov

 

Another important issue in this whole story are the prices for food products, growth of which in recent months has seen only a very wealthy person. For all the assurances of the authorities that food prices would not rise, private retailers meet another perekleivanie price tags. And this aspect of the problem for the state is more important. If the person will not be particularly caring, he bought the cheese made in Argentina or Vologda, the question, how much is this cheese and how its purchase will be tangible for the purse, people will almost always ask. Moreover, many asks this question in the end, I can give an answer about what they think about it, in any kind of elections, for example in the state Duma in September of this year. The government, of course, does not want any social upheaval, and in this regard it is extremely beneficial to the development of food retail chains.

In this state, the retailer can afford not to strive for profit maximization. As already wrote “Russian planet”, the purpose of the earnings in the network should not be: it will just work “in a zero”, the entire mark will be the sum of the overhead costs (salaries, logistics, utilities). At least he will have the opportunity to set their own prices on the market, making them a minimal and force other retail players, which is commonplace to start to lose clients, take the same measures.

It is very likely that this will lead to fair pricing for products, and the history of that particular retail sells sausage three times more expensive than bought from the manufacturer, will become the past.

Russian farmer and the grower Stanislav Tipikin told RP that he was ready to support the idea with state retail, at a reasonable guide can help both producers and buyers, but only if it doesn’t happen again the story of the weekend markets.

“Problems in the relationship farmers have with retail: dealers, and “ticket”. So possible a guaranteed market would be interesting. However, as with the idea of weekend markets, where everything was not transparent mechanism of contact point it is the manufacturer itself, this idea can also be complicated. For example, I would like to know which products will be emphasized, as I belong to the group of producers for whom quality is paramount, environmentally friendly products. But in the case when its not being fed all sorts of antibiotics and additives that raise all natural, the price becomes higher than in the case of cheap low-quality counterparts. Whether there will be this segment in such a state retail? Or, perhaps, to preserve and cultivate this line, we will have to subsidize from the budget, as in Europe?” — commented Tipikin.

Another no less important problem with retail in Russia is that, in fact, all such networks are operated by companies established outside the country. JSC “Magnet” is among the owners of a Cyprus company Lavreno Ltd and Labini Investments. X5 Retail Group, which owns retail chains Pyaterochka, Perekrestok, Karusel and Kopeyka, and is registered in the Netherlands. Budget “Auchan” not that other, as the Russian part of the French eponymous retail chain. Not the cheapest network “ABC taste” is a founding member of the Cyprus company V. M. H. Y. Holdings Limited. The total of these companies one thing: among them the owners must have a representative of a country which leads the sanctions war with Russia. And here we should recall that the concept of “food security” has not been canceled, and no one can guarantee that one day, the foreign owners of Russian trade networks will not accept local residents of the history, like disabling cards like Visa or Mastercard.

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