Manufacturers of household appliances Electrolux, Tefal, Braun and Rowenta began to block supplies to the Russian Federation through parallel imports

Manufacturers of household appliances Electrolux, Tefal, Braun and Rowenta began to actively block the supply of products to the Russian Federation through parallel imports, including sales on marketplaces. According to retailers, companies are signing a moratorium with partners in other countries on the re-export of electronics to Russia. Sellers allow brands to completely disappear from sale, hoping that they will be replaced by Turkish and Chinese goods.

The Swedish Electrolux Group (home appliance brands Electrolux, Zanussi, AEG) is limiting parallel imports of its products into the Russian Federation, said Sergei Li, chief executive officer of the M.Video-Eldorado group, at a conference dedicated to its financial results. According to the top manager, Electrolux products are already “represented in limited quantities” in the retailer’s network. He did not specify the mechanism of restrictions.

A Kommersant source among retailers explained that foreign brands that are trying to control parallel imports into Russia sign a moratorium on the re-export of goods with partners in other countries where they are officially represented: “Violation leads to the termination of the contract.”

After the outbreak of hostilities in Ukraine, the Swedish manufacturer of household appliances announced its withdrawal from the Russian Federation. First, the commercial structure of the Electrolux Professional brand completely stopped working in the country (see “Kommersant” dated July 11, 2022). Later, the company sold the consumer segment of the Russian business to local management (see “Kommersant” dated September 2, 2022). A few months later, the Russian team decided to create its own brand of household appliances, Vard (see Kommersant, January 18, 2023). Vard declined to comment.

Now Electrolux, says Dmitry Levin, managing director of the Large Household Appliances department of Marvel Distribution, is seeking to block the placement of its products even on marketplaces. “However, by the time it left the country, the company did not occupy a serious position in the market. For example, in its main segment of kitchen appliances, the brand lost competition to the German Bosch,” says Mr. Levin.

According to Kommersant’s interlocutor in the household appliances market, who refers to a report by the analytical agency GFK, from December 2022 to December 2023, Electrolux’s share, for example, in dishwashers in the Russian Federation fell from 5% to less than 1% in units.

Another departed brand, the German Bosch, lost more than half its share over the year and occupies 8% in the dishwasher segment in the Russian Federation. The leader at the end of 2023 was Chinese Haier, increasing its share in units by 6 percentage points (pp.), to 14%. In total, 1.3 million devices were sold in Russia, which is 14% more year-on-year.

In addition to Electrolux, Groupe SEB (brands Tefal, Braun, Rowenta) began tracking deliveries through parallel imports, notes Mr. Levin. Director of the consumer electronics department of OCS Distribution Vladislav Borodin claims that the practice of Western vendors to include in contracts a ban on the resale of products to Russia “was noticed” back in 2022 and 2023: “Some brands even initiated inspections and punished partners who violated the condition.”

Another Kommersant interlocutor among top managers of a large Russian retailer says that Electrolux products have not been sold in their network since February 2022. “Now it is not profitable to look for specialists in the supply of products supplied through parallel imports, since the final price is more expensive than analogues from other countries, and accordingly, it is impossible to make money on this,” he explains.

A Kommersant source believes that we can expect brands that have begun to block their supplies through parallel imports to completely disappear from the shelves of Russian stores. Meanwhile, the commercial director of the M.Video-Eldorado group, Oleg Muravyov, emphasizes that, despite the departure of “some vendors,” the overall product range in the retailer’s network expanded in 2023 by 22% compared to 2022, mainly due to Turkish and Chinese brands, as well as manufacturers from the EAEU countries.

Timofey Kornev, Yuri Litvinenko