Oh, sport, you are China – Newspaper Kommersant No. 211 (7412) dated 11/15/2022

The suspension of work and the exit from the Russian market of well-known Western brands of sportswear and footwear are forcing retailers to look for new suppliers. The Urban Vibes network, which is being developed by Sportmaster, intends to start deliveries of products from Chinese brands Li-Ning and 361 to the Russian Federation. The company also plans to become a distributor of inexpensive American sports shoes Etonic. Experts believe that the expansion of the line at the expense of products with a democratic price against the background of a decrease in consumer activity is unlikely to allow retailers to increase revenues.

The fact that Urban Vibes, which is being developed by the Sportmaster retailer, plans to become a supplier of Chinese sports brands Li-Ning and 361, was told by Kommersant on the network. Urban Vibes will be importing a few test batches of mostly casual sneakers soon. The network notes that sales of goods of new Chinese brands are expected to begin in the spring of 2023, but due to possible difficulties with logistics, deliveries may be delayed. Today, the Li-Ning and 361 brands are only available from unofficial resellers, whose assortment does not exceed a few positions, Urban Vibes points out.

The multi-brand network of sneakers, clothing and accessories stores Urban Vibes has 13 stores in Russia. By the summer of 2023, the company plans to open seven more new outlets.

Li-Ning launched the first mono-brand store in Russia in the spring of 2022 at the Gallery shopping center in Krasnodar. The second outlet is preparing to open in the Moscow Aviapark.

Marketplaces are also thinking about expanding the range of sports goods at the expense of Asian brands. In December, Ozon plans to start direct deliveries from manufacturers Li-Ning, 361, Erke, X-tep and Camel, the company told Kommersant.

Urban Vibes also says it’s in talks with American sportswear brand Etonic to supply shoes directly. Evgenia Khakberdieva, director of the retail real estate department at NF Group, notes that Etonic is presented in the middle price segment and is cheaper than Nike and Adidas. But while the brand is not very well known among Russian buyers, adds the head of the CORE.XP retail department Marina Malakhatko.

Alexey Vanchugov, managing partner of Vanchugov & Partners, notes that the initial entry of a brand into a new country through a partner is a common scheme. This allows the brand owner to assess the development prospects without significant investments, creating their own distribution centers and building logistics, the expert explains.

He cited the example of the Spanish chain Zara, which was initially developed in Russia under the Stockmann franchise, and a few years later the owner of the Inditex brand bought the Russian business.

Given the closure of large chain stores, the consumer has become more likely to buy basic clothing in multi-brand stores, as well as from buyers and resellers, says Evgenia Khakberdieva. She notes strong growth in other multi-brand sportswear chains. SportPoint buys goods and takes over the stores of outgoing brands, Street Beat announced the launch of a collection of tracksuits under the brand of the same name, Ms. Hakberdiyeva adds.

Wildberries notes a threefold increase in the supply of sportswear and footwear from Russian brands in October 2022 compared to January. Ozon confirms the trend to increase its presence of Russian sports brands – for example, Zasport, Forward, Demix, Termit.

According to Marina Malakhatko, there is a place in the Russian sportswear and footwear market for high-quality and inexpensive sports brands with an average check of up to 1,000 rubles. The expansion of the line of such products and rising inflation have allowed retailers of sporting goods to increase revenue over the past six months, she explains. However, the expert warns, the marginality of networks will decrease due to the desire of buyers to save. This trend increased in September after the announcement of partial mobilization.

Alina Savitskaya