“Russian brands for the consumer were in the shadows”

How the departure of world brands from the Russian Federation affected domestic clothing production, local factories and state support for the industry, Kommersant was told by the deputy head of the Ministry of Industry and Trade Victor Evtukhov.

— How can the closure of stores of major Western fashion brands affect the performance of the Russian clothing market this year?

– Now there is a constant growth in the volume of production of light industry in monetary terms, the average annual rate over the past five years is 8.3%. In 2021, it was 37.7% more than in 2017. The most significant increase over several years has been noted in the production of non-woven materials, synthetic fabrics, knitwear and overalls. In the first nine months of 2022, production in monetary terms also increased by 18.6% compared to the same period last year.

— Has the departure of large Western brands created an additional incentive for Russian ones?

– Even before the situation with the suspension of activities of a number of foreign brands of clothing, footwear and accessories, it was possible to meet Russian brands in many shopping centers, but in the eyes of the consumer they were in some kind of shadow. And today, local brands that have not only Russian roots are gaining more and more popularity. They have their own production facilities in the country or place orders with Russian enterprises.

If we take the most visited shopping centers, then on average there can be counted from 15 to 30 stores of Russian brands. In the Afimall shopping center, instead of the brands that have suspended their activities, stores with Russian brands have already appeared or banners about the imminent opening have been posted.

— Do many Russian brands really produce collections in Russia?

– Alice Fashion Group, for example, has its own production facilities, both sewing and knitting, which allows it to sell capsule collections with a wide range of items. In addition, now the company is actively working on the direction of the men’s clothing line.

The brand Brusnika, popular not only in Russia, also has its own clothing and knitting factory in the Russian Federation, 12storeez also produces part of the products in our country, and the company has reasonable prospects for growth and increased demand. Gloria Jeans, “Your”, the brands of Melon Fashion Group, Concept Group have long been known to the Russian consumer.

The Ministry of Industry and Trade is now updating the study of Russian brands of clothing, footwear and accessories, hosiery, bed linen, which began in 2021, and we can already say for sure that there are about 2 thousand brands with production in Russia.

— Are additional measures of state support for Russian manufacturers of clothing and footwear being discussed? Is there a general need for this?

– For light industry enterprises, the government, together with the Ministry of Industry and Trade, has already developed several support options. Small and medium-sized enterprises, with the help of the SME corporation, can get preferential loans from banks.

The Industrial Development Fund also has a set of state support measures. Subsidies remain to compensate for part of the cost of servicing loans, subsidies for equipment purchased on lease, subsidies for R&D, a subsidy to compensate for losses in income, etc.

In addition, light industry enterprises can use the right to import raw materials at zero duty, having received appropriate confirmation of the intended purpose. For example, this program covers chemicals for the leather and footwear industry and latex used in the manufacture of carpets. In just 11 months of 2022, the Ministry of Industry and Trade provided Russian light industry enterprises with sectoral subsidies for 1.9 billion rubles.

Interviewed by Anatoly Kostyrev