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The Role of Chains in the Russian Retail Sector

Author

Listed:
  • Aleksandr Victorovich Sigarev
  • Mikhail Evgenievich Kosov
  • Olga Borisovna Buzdalina
  • Roman Alexeevich Alandarov
  • Inna Nikolaevna Rykova

Abstract

Over the recent 15 years, Russian retail sector has moved from independent stores to chain structures since such trade organization is more competitive due to a single procurement policy, economies of scale, more developed logistics, own distribution centers, greater brand recognition, etc. However, the increase in the market power of retail chains is often considered as a threat for the free market and competition.This work represents an attempt to determine the degree of concentration on the Russian food retail market within the context of economic downfall, as well as the competitiveness of such forms of business organization as retail chains. The goal of the study is to test the research hypothesis that in the context of the Russian economy's recession some players leave the food retail market, thereby increasing the market concentration, while the market power of retail chains that are more competitive increases. To test the hypothesis of the study, relevant statistical data were analyzed for the period of 2010-2015. The estimation of the monopolization indicators made it possible to make conclusions about the concentration in the industry.The following indicators for the Russian Federation were analyzed: distribution of retail trade turnover by forms of trade; the share of retail trade networks in the formation of retail trade turnover; and the turnovers of major food retailers. The concentration indices were calculated as well. The role of mergers and acquisitions in the retail food market as a factor of increasing the concentration was highlighted herein. The players leaving the market were specified. According to the results of the study, two trends have been identified: The share of retail chains on the retail food market increased and the market concentration in the sector divided by retail chains increased.

Suggested Citation

  • Aleksandr Victorovich Sigarev & Mikhail Evgenievich Kosov & Olga Borisovna Buzdalina & Roman Alexeevich Alandarov & Inna Nikolaevna Rykova, 2018. "The Role of Chains in the Russian Retail Sector," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 542-554.
  • Handle: RePEc:ers:journl:v:xx:y:2017:i:3b:p:542-554
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    References listed on IDEAS

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    1. L.A. Kormishkina & N.N. Semenova, 2016. "Monitoring of Food Security in the Russian Federation: Methodology and Assessment," European Research Studies Journal, European Research Studies Journal, vol. 0(3A), pages 185-202.
    2. Nadezhda A. Serebryakova & Sergey V. Semenenko & Natalya V. Grishchenko & Tamara Y. Ulchenko, 2016. "Competitive Potential of Trade Organization: Theoretical and Methodological Foundations of Formation and Realization," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 3-11.
    3. Ali Hortaçsu & Chad Syverson, 2015. "The Ongoing Evolution of US Retail: A Format Tug-of-War," Journal of Economic Perspectives, American Economic Association, vol. 29(4), pages 89-112, Fall.
    4. Nadezhda Vasilievna Sedova & Nikolay Nikolaevich Gagiev & Dariya Mikhailovna Melnikova, 2017. "Role of Agricultural Import Substitution Policy in Ensuring Food Safety of the Country," European Research Studies Journal, European Research Studies Journal, vol. 0(2B), pages 251-260.
    5. Markin, Maxim, 2012. "How State Regulation of Retail Trade was Justified: an Empirical Analysis of the Arguments," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, pages 147-162, August.
    6. Oksana Borisova & Ludmila Abramova & Liliya Zageeva & Elena Popkova & Irina Morozova & Tatyana Litvinova, 2015. "Role of Agricultural Clusters in Provision of Food Security," European Research Studies Journal, European Research Studies Journal, vol. 0(3), pages 287-298.
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    Cited by:

    1. Evgeny V. Balatsky, Natalia A. Ekimova, 2024. "Identification of Economies of Scale in Regional-Industrial Production Complexes of Russia: Theoretical Foundations and Econometric Estimates," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 23(2), pages 394-421.

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    More about this item

    Keywords

    Retail chains; food retail; competition; concentration; market power. JEL Classification: F10; L80; L81;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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