Italians will dress up children – Newspaper Kommersant No. 239 (7440) of 12/23/2022

Despite the general geopolitical crisis, some European fashion brands remain interested in developing in Russia. So, in 2023, children’s clothing stores of the Italian brand OVS Kids may open in the country. The brand’s collections will be able to replace the departed H&M, but competition is already intensifying on the market, and consumers are increasingly moving into savings mode, experts warn.

The fact that children’s clothing stores of the Italian brand OVS Kids may open in Russia in 2023 was reported to Kommersant by a source among large fashion operators. He did not disclose details. The distributor of European brands Smart Casual Group will probably develop the brand in Russia. So, in December, a vacancy for the head of retail OVS Kids appeared in the Smart Casual Group profile on the HeadHunter portal. The candidate’s responsibilities include the launch of five new stores, operational network management, sales planning and forecasting, team building, etc. Smart Casual Group and OVS SpA did not provide comments.

OVS was founded in 1972. Calls itself the largest seller of women’s, men’s and children’s clothing in Italy. The OVS SpA group with about 2,000 outlets also includes the brands UPIM and Stefanel. Smart Casual Group is already distributing Stefanel. Also in the company’s portfolio are the German brand Gerry Weber, the French brand Gertrude + Gaston, etc.

Stores under the OVS brand in Russia were previously developed under the franchise of Maratex Fashion Retail Company (part of the Polish EM&F). But the business was hit by currency fluctuations in 2014, and at the end of that year, Maratex announced it was closing outlets. Now OVS Kids clothes are also presented in Stockmann department stores, as well as on Ozon, Lamoda, Wildberries online platforms. In Stockmann, brand items cost from 800 rubles. up to 3.6 thousand rubles.

Fashion Consulting Group CEO Anna Lebsak-Kleymans says OVS operates in the “lower middle” price segment along with H&M, LC Waikiki, Russian Acoola or Gloria Jeans. The head of the CORE.XP retail department, Marina Malakhatko, believes that OVS Kids can become a replacement for the H&M children’s line among middle-class consumers in large Russian cities.

Alexey Vanchugov, managing partner of Vanchugov & Partners, points out that there is already a high level of competition among children’s clothing brands in the “medium” and “average minus” price segments. According to him, OVS Kids has a potential for development if the brand’s clothes are oriented towards a more expensive segment in terms of quality and price.

Such consumers suffer less from crises and generally do not cut spending on goods and clothing for children, Mr. Vanchugov points out. Marina Malakhatko adds that, in general, many players have doubts about the development of the children’s goods segment in the long term against the backdrop of negative demographic forecasts and growing consumer economies.

The entry of a new European brand into the Russian market is not typical for the current geopolitical situation, when many brands from Western countries seek to reduce their presence in the Russian market. According to the NF Group, after the outbreak of hostilities by the Russian Federation in Ukraine and a new wave of Western sanctions, about ten major foreign fashion brands, including H&M, Zara, Mothercare, announced their withdrawal from the Russian Federation. And mainly Turkish brands came out, such as Ipekyol, Machka, Twist, working through local partners.

As Marina Malakhatko notes, among European companies, Italian companies are relatively heavily dependent on the Russian market and do not want to lose it at all. According to NF Group, more than 15% of the more than 150 foreign brands of various industries remaining in the shopping centers of Moscow are Italian brands.

Alina Savitskaya