The russian chain of low-price retail stores Dobrocen, which entered the Uzbek market just 3.5 months ago, announced the temporary closure of its stores in Uzbekistan, EastFruit experts report, citing Telegram channels of the chain’s outlets.

To date, the russian chain “Dobrocen” has 5 stores in Uzbekistan – in the cities of Tashkent, Bukhara, Karshi and Margilan. Liquidation of goods in these stores has started on March 30, 2022 and they will be sold at half price.

The photo shows the announcement about the closure of stores in Uzbekistan, posted on the Telegram channel “Dobrocen” Karshi store. It states “50% discount on all goods from 30/03/22 to 28/04/22” (translated from Uzbek).

According to the Qashqadaryo 24/7 Telegram channel, the reason for the closure of stores is “unfavorable situation in russia”, they may reopen, but it is unknown when. The same reason for closing stores is indicated in the Dobrocen Margilan Telegram channel. However, while in the first case the resumption of the work of the Dobrocen stores is said to be possible, the second source writes about the temporary suspension of the activities of the store in Margilan for 2-3 months.

We remind you that the plans of the Dobrocen chain to enter the Uzbek market were announced in October 2021. On December 18, 2021, the first Dobrocen store in Uzbekistan opened its doors in the city of Bukhara, where more than 1 500 items of food, household chemicals and non-food products were presented. On December 25, 2021, the russian chain opened three more stores in other cities of Uzbekistan – in Tashkent, Karshi and Margilan, and then one more in Margilan. Thus, the number of Dobrocen stores in Uzbekistan has reached 5.

As of December 2021, the russian retail chain Dobrocen had 500 stores. The Dobrocen chain abroad is present in four countries: in 2019 it opened its first store in Belarus, at the end of April 2021 in Kazakhstan, in December 2021 in Uzbekistan and Armenia.

A feature of the Dobrocen retail chain is its format of a store-warehouse without division between the trading area and storage, with the display of goods not on shelves, but directly on pallets. The retailer’s assortment includes about 1 200 items of the most popular high-quality food products and everyday household goods at the lowest possible prices.

Сообщение Russian discounter Dobrocen closes its stores in Uzbekistan появились сначала на EastFruit.

Russia’s military aggression has disrupted the usual mode of life for all Ukrainians. People mobilized to defend their land. Everyone, in their place, contributes to ensuring the life of the country, fighting at the front, protecting their cities and towns, supplying assistance to the army and civilians, taking care of the food security of Ukraine.

In a commentary for EastFruit, Oleksandr Pakhno, UHA trade cooperation director, head of the “Sady Dnipra” company, reports that the company is working more than usual. According to Oleksandr Pakhno, the employees of the “Sady Dnipra” stayed with their families in Ukraine. Growers have a lot of work now – they collect and deliver aid to the Armed Forces of Ukraine and internally displaced persons. In addition, “Sady Dnipra” supplies its products to all currently logistically available supermarket chains.

The company cares about employees, supporting their families. “We try to stay positive,” Olexandr Pakhno assures.

Сообщение Ukrainian growers work in an emergency mode появились сначала на EastFruit.

EastFruit analysts have conducted a unique study of the retail trade of fruits and vegetables in Ukraine that allowed to digitize all the main sales channels for fresh fruits, berries and vegetables for the first time.

“While working on the study, we encountered a number of surprises that shed light on many seemingly illogical decisions of supermarket chains in this area. We also identified the top 20 vegetables and fruits sold in supermarket chains, determined the volume of the sales and their proceeds, and even made a rating of Ukrainian supermarket chains in terms of vegetable and fruit sales. Our analysts also used statistical indicators to estimate the revenues of the cash market in horticultural business in Ukraine and key reasons for this phenomenon for the first time” says Andriy Yarmak, economist at the Investment Centre of the Food and Agriculture Organization of the United Nations (FAO).

“This will be of interest to all supermarket chains, as it will help them understand their strengths and weaknesses in the market. After all, it is the produce department that is the key to the successful food retail business in modern realities. In addition, based on the study, we discovered new opportunities for growers (vegetable, potato, berry growers, etc.) to develop production and sell at higher prices. Naturally, it will be useful to importers and traders of vegetables and fruits, too. We will also tell them about the tools to select partners among supermarket chains right in order to reduce the potential risks of non-payment for the goods delivered” the FAO expert explains.

Leading experts of Ukrainian retail and horticultural business will also share forecasts for the development of the fruit and vegetable trade in such sales channels as online sales, cooperation with the HoReCa segment and processing.

The research results will be presented at the international conference “Retail Forum-2021” on December 2, 2021 in Kyiv within the framework of #FTradeClub. You can register for the conference here. The event is supported by the Ukrainian Horticultural Association, the European Bank for Reconstruction and Development (EBRD) and FAO.

After the Retail Forum, a Trade Forum will take place, where the main national and regional supermarket chains in Ukraine will have direct B2B negotiations with growers and traders on the supply of fruits and vegetables.

Сообщение Fresh produce trade in supermarkets of Ukraine: revenues, trends, structure and forecasts появились сначала на EastFruit.

Uzbekistan continues to be in the focus of attention of retailers around the world. According to EastFruit experts, two Russian chains of the discounter segment are currently entering the country’s retail market: Svetofor and Dobrocen. This means that the “supermarketization” of Uzbekistan continues!

Despite the fact that the chains did not make official announcements about entering the market, both Svetofor and Dobrocen started looking for employees in a number of cities of Uzbekistan, posting vacancies on job portals. The range of tasks for potential employees of Russian discounters includes finding suitable buildings for new stores, negotiating with landlords and developing a retail chain.

A number of foreign, international and local companies have recently entered the food retail market of Uzbekistan, including French Carrefour, Magnum Cash & Carry from Kazakhstan, Havas, Asia.uz and Baraka Market. Almost all of existing chains announce ambitious expansion plans and many new store openings. It means that the chain retail market in Uzbekistan is experiencing a real boom. You can see which ones are best at selling vegetables and fruits – the main position attracting buyers to stores, in our audit of fruit and vegetable departments of supermarkets in Uzbekistan.

Who are the new players in the Uzbek retail?

“Svetofor”   

According to the website “Uzbek Retail”, two companies ACTIVE RETAIL LLC and BIGRETAIL LLC were registered in Uzbekistan in June and July this year, their main shareholders being the owners of the Russian retail network “Svetofor”.

The activity of the Svetofor retail network dates back to 2009, the first stores of this chain were opened in the Russian cities of Krasnoyarsk and Achinsk. Three years later, the chain consisted of 37 stores. But the retailer began to actively expand in 2012 – more than 500 stores were opened over the next three years. In 2015, the number of Svetofor stores has reached 550.

The company entered the markets of other countries and opened stores in Belarus and Kazakhstan in 2017, while the number of Svetofor stores in Russia exceeded 1000. Svetofor enters a number of countries, primarily the EU ones, with the Mere trademark. From 2018 to early 2021, Mere stores opened in Romania, Germany, Lithuania, Poland, Ukraine and Serbia. In May 2021, the Russian retailer planned to open stores in the UK, as well as enter other European markets – Spain, Greece, France, etc.

At the beginning of 2021, the Svetofor chain had more than 2,200 operating stores.

The main goal of the Svetofor chain stores is to provide consumers with goods at the lowest prices in the region. The format of the stores is a hard discounter, the average store area is about 1000 sq. m. The general principle of the chain stores is self-service, the range of goods is no more than 2000 items of food and non-food groups. The design of the chain stores is minimalistic in the sales area with a catchy exterior.

The main competitive advantage of the chain is low prices – about 20% lower than the market average due to direct work with producers, tight cost control and minimal trade mark-up. The sales area of ​​the store itself is usually a warehouse that allows to save time on maintenance of the sales area and reduce the cost of renting premises.

As for vegetables and fruits, they are not key positions for Svetofor. The range of fruits and vegetables in stores is usually very narrow, and prices are not as competitive as for packaged products. Therefore, it is unlikely to have high ratings in EastFruit retail audits.

“Dobrocen”

On October 11, 2021, Uzbek Retail announced the plans of another grocery discounter to enter the Uzbek market namely the Russian retail chain of warehouse stores “Dobrocen”.

The  retail chain Dobrocen is relatively new; the first store was opened on August 6, 2016 in Krasnoufimsk (Russia) and began to expand fast throughout Russia. The number of chain stores reached 200 at the end of April 2020.

As for entering the markets of other countries, the Russian Dobrocen chain is present in two countries so far: in 2019 it opened its first store in Belarus, and at the end of April 2021 – in Kazakhstan.

As of May 2021, the Dobrocen chain had 350 stores.

The peculiarity of the retail chain is the format of a store-warehouse without division between a sales area and storage, goods being displayed not on shelves, but on pallets (warehouse pallets). This allows to keep a large inventory in the hall, minimize the number of staff and trade equipment, thereby significantly reducing prices for buyers comparing to traditional stores. The assortment of the retailer includes about 1200 items of the most popular high-quality food products and household goods at the lowest prices.

It turns out that both chains plan to enter the Uzbek market almost simultaneously and will work in the same format, unique and new for the country.

It is difficult to say whether Uzbek customers will like such a format. However, there is no doubt that the income level of the population in Uzbekistan is not high and consumers will be glad to save money. The local market for food suppliers is not very diverse, there are few players, and import duties in the country are very high. Therefore, only time will tell whether Russian chains will succeed in reducing prices to a competitive level.

Сообщение Russian supermarket chains “Svetofor” and “Dobrocen” are expected to enter the Uzbek market появились сначала на EastFruit.

According to the suppliers of vegetables and fruits of one of the largest supermarket chains in Ukraine “Silpo”, which is part of the Fozzy Group, the entire team responsible for the purchase of vegetables and fruits and management of the fruit and vegetable departments of the chain, was fired.

Obviously, the dismissal was unexpected, because more than a week had passed since the fruit and vegetable management was removed from work, and there is still no new team formed. Therefore, the management of the department is temporarily assigned to the management of other departments, completely unfamiliar with the specifics of the fruit and vegetable trade. Accordingly, this creates huge difficulties for suppliers and may affect the position of Silpo in the rating of supermarket chains in Ukraine. After all, it is the produce department that is decisive in estimating the retail business of any chain, as we have repeatedly proved by EastFruit audits in different countries.

By the way, EastFruit audits are also a good indicator for suppliers of fruits and vegetables. The chains at the bottom of the overall rating or those classified as “undesirable” often experience difficulties in timely payment for vegetables and fruits delivered to supermarkets. Suppliers of the Silpo chain have constantly complained to us about the delays in payment from the chain in recent years. The main competitor of Fozzy Group in the retail market of Ukraine, on the other hand, received positive reviews. This is an essential factor influencing the timely provision of high-quality and affordable products to supermarkets.

Why was the Silpo fruit and vegetable team dismissed? There is no reliable information on this, so we will rely on our own data from EastFruit retail audits. In fact, the Silpo chain has recently made some progress in fruit and vegetable ratings, although before that its supermarkets were for a long time at the bottom of the list long a of our ratings in Kyiv and other cities where the audit was carried out.

In July 2021, the Silpo chain had progress in terms of the most important criterion, its most problematic one in recent years – the price level for vegetables and fruits. However, it continued to lag behind competitors in terms of assortment, since there were stores of various formats under the Silpo brand: both large, arguably premium stores, and very small ones, with a small assortment and often low-quality products, similar to the convenience or discount stores. This blurred the overall performance of the chain in the ratings.

It should be noted that in addition to Silpo, the Fozzy Group includes supermarket chains Fozzy, Le Silpo, Fora, Thrash! They have different formats – for instance, Le Silpo is often found among the leaders of our rating of fruit and vegetable departments. Fora, on the other hand, is almost always one of the supermarkets at the bottom of the list, not to mention the chain with the eloquent name Thrash!.

According to the EastFruit analytical team’s estimates, made by indirect methods, the turnover of all Fozzy Group supermarket chains for fruits and vegetables in 2020 could be from 7.2 to 7.6 billion UAH, which corresponded to $260-280 million. This made the chain one of the largest sales markets for fresh fruits and vegetables in Ukraine. By the way, this approximately corresponded to the exports of all vegetables and fruits from Ukraine in a year!

That is why the management dismissal of the fruit and vegetable department of the Silpo supermarket chain and other chains of the Fozzy Group has a serious direct impact on the Ukrainian market for fresh vegetables, fruits and berries.

Сообщение Ukrainian supermarket chain “Silpo” fired the management team of fruit and vegetable departments появились сначала на EastFruit.