Peculiarities in Development of Retail Networks and Trade Formats in Russian Grocery Sector in 2000s (regional aspect)

Abstract

The Russian retail trade has experienced fundamental changes from structural and institutional perspectives. This stage of its development was called by experts as ‘trade revolution’ triggered by the emergence of new organizational forms and chain-store system. A store chain refers to a group of similar stores inter-related by property rights and common system of management. The XX century saw a large-scale expansion of chain stores in the global economy. The dominancy of chain stores and new formats is a manifestation of more general process known as the formation of mass distribution system, the success of which resulted from the fact that it turned out to be compatible with the standards of the modern economy based on three principles: economies of scale, standardization and reduction of all business processes to primitive forms. Moreover, distribution of store chains and trade formats is a cultural phenomenon which varies from one society to another temporally and spatially. The article presents a taxonomy of the Russian food chains and reviews factors determining the development of trade forms on local markets of four cities: Moscow, Ekaterinburg, Blagovechshensk, Magadan. The empirical data were collected from 18 in-depth interviews with top managers of domestic retailers. The paper is based on series of cross-regional researches conducted in 2006 (headed by Z. Kotelnikova). The research results show that the Russian retail trade’s organizational field has been formed differentially. Its formation is influenced by economic policies of local governments, peculiarities of consumer behaviors, treats of geopolitics, institutional isomorphism, and business networks. All domestic retailers pursue the same strategy of development – adaptation to external conditions. Moreover, small trade formats oriented to quality of service are dominated in local markets in Russia.

Keywords: retail trade, mass distribution, institutions, food store chains