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Moscow Mall opens for Russian business after a big brand outflow

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Moscow — Western fashion brands stand out for not being in a sparkling new shopping center on the outskirts of Moscow, saying that customers rarely miss them.

Following Moscow's decision to send thousands of troops to Ukraine at the end of February, international fashion brands from Adidas to Zara have suspended their activities in Russia, but Nike. Is the market.

"I'm neutral about this, whether I have it or not," shopper Alexandra Mosquenova told Reuters at the Cobrino mall. "I can do happily without them."

Another customer, Irina Stakhanova, said: You don't need foreign stuff, you just need something that looks good for you to lift your mood.

In the Russian capital, there are few obvious signs that you need to be uplifted. When street performers sang and played, restaurant terraces spilled onto the pavement, and temperatures exceeded 30 degrees Celsius (86 ° F), the Moscow people were cooled by the fountain near the Kremlin.

However, in the capital's most popular shopping district, the closure of luxury Western brands stands out.

The TsUM department store, owned by the Russian luxury group Mercury, is one of the last places Russians can get genuine luxury from international companies.

While Chanel's Russian shop was closed, the brand had an outlet in TsUM with some watches on display, but couldn't be named. The members of the staff were the last ones left.

"Only the ones I already bought were in stock," she said. "There were a lot of people. Only we can buy Chanel items."

Chanel, like many other companies, said in early March, "For the current situation." There is growing concern, "he said, suspending business in Russia.

'Sanctions go to hell'

Consumers may be ready to buy what they can buy, but the manager of Khovrino Mall said on June 23. He said that not everyone opened in time for the official opening. ..

Retail leasing director Nadezhda Tsvetkova said some companies did not open when the mall opened due to "serious problems" with logistics and delivery.

Mall owner Viktor Chernykh, project director of MR Group, said some tenants had problems.

For example, Russian consumer electronics retailer M. Video-Eldorado has encountered a logistics problem and plans to open in early July, he said.

"From March to April, like many companies in the Russian market, the company was primarily ... focused on developing a variety of products and controlling prices," M. Video said. Says. “We needed time to assess the outlook for different locations in the new economic situation.”

Some companies were afraid to be on the sanctions list by paying attention to themselves. I have avoided advertising. Retailers were remarkably quiet at Russia's major international economic forums this month in St. Petersburg.

McDonald's restaurant was scheduled to open in the mall, Chernykh said, but the company's withdrawal from Russia made it impossible. Russian brand Vkusno & tochka, which appeared after McDonald's was sold to a local licensee, will open, but it is not clear when.

The only foreign food chain that has ever existed is KFC, owned by Yum Brands Inc.

Suspended investment in Russia and closed 70 restaurants owned by KFC. The rest of Russia's 1,000 KFC outlets are run by independent franchisees with limited control by Yum.

Asked for comment, Yam referred to a statement made by CEO David Gibbs in May, stating that he had stopped investing and developing in Russia.

The Crocus Group, which also runs a shopping center, says Russian malls are "dead" and have lost about 30% of their footsteps since the Western brands left. ..

For all issues, Tsvetkova predicts that the current daily traffic volume will increase from about 7,000 to 15,000 when the 18,300 square meter center is fully operational in bright light.

Customers have said some closures are sad, such as the closure of French sporting goods retailer Decathlon on Monday, but they will adapt.

"Of course, that's a shame," Decathlon customer Magomet told Reuters. "People, including me, have lost their jobs due to sanctions. But everything will work, everything will work. Go to Russia."

(Report by Reuters, Edited by Barbara Lewis)