More and more companies are joining the international sanctions against Russia. The consequences can already be felt in everyday life in Russia: shops are closing, credit cards no longer work, thousands of people are losing their jobs. The opinions of Russian residents on this are divided.
In a representative survey by the Russian research center SuperJob, 49 percent of Russians said they would avoid products from Western companies even if they returned to Russia. Many hope that the Chinese alternatives will fill the gap in the market in the future, but the gaps are already being felt.
McDonalds
The opening of a fast-food restaurant “like in the West” was not allowed by the Soviet authorities for a very long time. The confrontation between the Warsaw Pact states and NATO in the 1980s meant that opening a “hostile” catering establishment was out of the question for a long time.
The first McDonalds came to Moscow only in 1990. On the opening day, a total of 30,000 people visited the fast food restaurant – a record number for the chain worldwide. For the Soviet citizen, McDonalds was not just a restaurant, it was an embodiment of the Western way of life.
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After the Russian troops invaded Ukraine, the inhabitants of Russia had to say goodbye to it again. McDonalds is closing stores indefinitely and suspending operations in Russia. On the Crimean peninsula, restaurants were already closed in 2014. In addition to fast food chains, Starbucks, Coca-Cola and Pepsi are also leaving the Russian market.
According to the Russian newspaper RBK, McDonalds is one of the top-selling companies in the Russian fast food market. Its direct competitor Kentucky Fried Chicken (KFC) also announced that operations in Russia will be suspended.
The third largest company, Burger King, has no plans to leave Russia. However, a company representative told the Tass news agency that there are already difficulties in supplying some ingredients.
Ikea
Like many other European companies, Ikea has temporarily suspended its business in Russia. 17 furniture stores and three production facilities will remain closed until at least May 31st. The CEO of IKEA Russia, Pontuscroftell, announced only recently that the Russian market had become one of the most important thanks to its share of Ikea’s global sales.
On the last day before the closure of Ikea stores, there was a mass rush to stores in several Russian cities. The market offers alternatives to Ikea, but people don’t seem to believe in success.
The rival chain Obi has also ceased operations in Russia. As an alternative to the two stores, the French hardware store chain Leroy Merlin remains on the market. However, the company expects some difficulties in the future: A small proportion of suppliers have temporarily suspended services, in most cases due to demands for higher prices, according to a company press release.
According to Leroy Merlin, the prices for goods will remain unstable for a certain time, which is partly due to rising material prices.
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Spotify
Music streaming service Spotify has also regulated its operations in Russia due to the situation in Ukraine. External restrictions would have made payment processing impossible, which would automatically cancel the premium subscriptions, they say.
Spotify only entered the Russian market in 2020 and called the launch the most successful ever. Even if the separation from the streaming service can be painful after such a short time, the Russian market offers alternatives.
The second most popular music service, Boom, is the official app of VK (Russian Facebook analogue), while the third place, according to Brand Analytics, is the Yandex.Musik platform. These services are still available in Russia and allow payment processing with Russian cards.
Amazon
The world’s largest online retailer Amazon has stopped shipping products to private customers in Russia and Belarus in response to the Russian war of aggression.
The group also announced that it would block users in Russia from accessing its Prime Video streaming service until further notice. In addition, Amazon will no longer accept orders for “New World” there – the only video game that the company sells directly in Russia.
Amazon has also decided to close both its online marketplace and cloud platform AWS to new customers in Russia and Belarus.
The group emphasizes that it does not operate any data centers, infrastructure or offices in Russia. Amazon has also long had a policy of not doing business with the Russian government. The group works closely with IT organizations to help Ukraine protect against cyber attacks.
automaker
Most European and Japanese automobile manufacturers have also announced their withdrawal from the Russian market. Companies such as the Volkswagen Group, BMW and Hyundai have decided to stop production at Russian plants.
The world’s largest truck manufacturer Daimler Truck has ended its cooperation with the Russian truck manufacturer Kamaz. The French company Renault has also temporarily restricted its activities in Russian plants due to logistical bottlenecks.
The closure of businesses will no doubt impact corporate revenue. Volkswagen alone sold more than 85,000 vehicles in Russia in 2021, and the Volkswagen Group’s annual sales in the Russian market amounted to around 300 billion rubles (about 3 billion euros).
There is also bad news for the owners of these car brands in Russia. The prices of car details and accessories are already increasing enormously, partly due to the exchange rate. (with dpa)
