Retailer Looks to Expand Its Russia Business As More Firms Pull Out

  • Russian arm of a French retailer wants to expand product variety at its stores, The Telegraph reported.
  • The retailer said sales had increased since other brands halted operations in Russia, per the outlet.
  • The decision to expand business comes as other brands have closed stores in Russia.

A French retail giant said it wants to expand the products on offer at its Russian stores to fill the gap left by other brands after they halted operations in Russia, The Telegraph reported.

Leroy Merlin, which sells homeware and gardening goods, said that “sales have significantly increased” since Russia invaded Ukraine on February 24, according to The Telegraph. 

In a letter seen by the Telegraph, heads of the Russian branch of Leroy Merlin told suppliers: “Since the disappearance of certain companies from the market, we are open to your proposals on the increase of supply and the increase of your assortment of products.” 

“In the next three to four months we plan to fully replace imported products with those produced in Russia,” the letter added, per the Telegraph. 

The retail giant’s decision to expand business operations in Russia comes as more brands temporarily close stores in the country. Retail giants such as H&M, Starbucks, and IKEA – one of the company’s competitors in home goods – have all halted operations in Russia since the invasion started on February 24.

Other retailers which are still operating in Russia have come under pressure to close stores. Burger King and Papa John’s – each operating in Russia through franchise agreements – have faced criticism for having stores open there. The restaurants have suspended corporate support for the chains, but have insisted that neither can unilaterally suspend operations there.

Leroy Merlin is owned by French retail moguls, Association Familiale Mulliez, who also own the sports retailer, Decathlon. The Mulliez family behind the company is worth around $45.9 billion, according to Bloomberg.

Leroy Merlin operates 112 stores in Russia, while Decathlon has around 60 Russian stores. Neither retailer has suspended their operations in Russia, The Telegraph reported.

Decathlon did not respond to Insider’s request for comment. Insider also reached out to Leroy Merlin and Association Familiale Mulliez on LinkedIn, but did not immediately hear back.

Another sister company – the French supermarket giant Auchan – which operates over 300 stores in Russia is still open there, according to The Telegraph. A company spokesperson told the paper that “the company stood beside Ukrainians by keeping stores open and providing humanitarian aid.”

A representative for Auchan did not immediately respond to Insider’s request for comment when approached on LinkedIn.

https://www.businessinsider.com/retailer-looks-expand-russia-business-as-more-firms-pull-out-2022-3

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