Finnish Supermarket Chain to Open Stores in City
The Finnish retailer SOK plans to open and develop its Prisma supermarkets in St. Petersburg until it occupies 15-17 percent of the local retail market by opening about 20 supermarkets over the next five years.
УWe think there are still areas in St. Petersburg where supermarkets can be opened in the city center and hypermarkets in the suburbs,Ф Antti Sippola, vice-president of SOK Corporation, said Thursday at a press conference.
Last year Prisma sales stood at $3.73 billion. The company operates 51 Prisma stores in Finland, five in Tallinn and one in Riga. This year SOK will open its first supermarket in Vilnius as well as a new supermarket in Riga.
In St. Petersburg, the first Prisma will open this summer in the Hotel Moscow shopping center at the Ploshchad Alexandra Nevskogo end of Nevsky Prospekt.
This central location offers good prospects Ч there are no other large food retail stores in this area, said Vesa Punnonen, president of SOK Retail in Russia.
The space for the 2,500 square-meter supermarket was leased from Adamant, and investment totaled almost $8 million. By 2015, SOK expects to operate 15 to 20 supermarkets in St. Petersburg and its suburbs, investing 475-790 million dollars.
The supermarkets will occupy areas varying between 4,000 and 17,000 square meters, and their ranges will exceed 60,000 items, including food, consumer products, clothes and electronics. Initially, 80 percent of products will be supplied by Russian companies and the rest imported from Finland.
, indicated that in the city center large shopping areas could be created only in zones assigned for complex redevelopment.
Considering the high concentration of shopping areas in St. Petersburg, PrismaТs project could be more profitable in the suburbs, such as the Primorsky, Kurortny, Pushkinsky, Petrodvortsovy and Lomonosovsky districts, Akinshin said.
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The most attractive premises along the cityТs main roads are already occupied, and now basements and former air-raid shelters are being redeveloped. The company could take part in the St. PetersburgPropertyFund tenders, but in that case they would have to buy whole buildings, open a supermarket on the ground floor and somehow manage the other areas, Luchkov said.
Even in the suburbs, the most attractive central locations are often unavailable, he warned.
estimated construction costs at $1,200 per square meter. …
Large retail areas are popular in St. Petersburg, Luchkov said, including hypermarkets.
Perekryostok (whose stores occupy up to 10,000 sq. m.), Karusel and OKey (12,000-15,000 sq.m.) as PrismaТs likely main competitors.
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We have many economy-class chains like Diksi and Pyatyorochka and a couple of elite brands, but the middle-class niche is unoccupied. Many consumers want something more than standard middle-class goods and expect higher quality, but are not prepared to pay for expensive products. SOK has good chances of winning these customers,Ф Luchkov said.
Mikhail Podushko, director for strategic development at WorkLine Research, indicated that as incomes increase and more city residents buy cars, people prefer supermarkets and hypermarkets to discount stores.
According to WorkLine, Pyatyorochka and Diksi are the most popular discount stores, while Lenta, OKey and Karusel are the most popular hypermarkets. The largest increase in monthly spending has been seen among customers of Karusel and OKey seven percent over the last two years.
PrismaТs plans are too optimistic. Of course, much will depend on the locations, range of goods and marketing, but it will be difficult to force out the leaders, as the recent attempt by Auchan to do so shows, said Podushko.
New Bukvoyed Store
ST. PETERSBURG (SPT) Ч The St. Petersburg bookstore chain Bukvoyed will open a new store Saturday, the company said Wednesday in a statement.
Bukvoyed already operates 27 bookstores. The new store will open in the УOnФ shopping center in the Nevsky district. The company has invested about $60,000 into the store, whose range will include over 10,000 items. This year Bukvoyed plans to open eight stores in St. Petersburg and four stores in other parts of the northwest region.
Toyota to Sell Camry
ST. PETERSBURG (SPT) Ч Toyota Motors will start selling Camry cars produced at its new St. Petersburg plant on March 31, the company said Wednesday in a statement.
As a result of the decrease in customs taxes, the company recommended that its authorized dealers and partners decrease the price for the Toyota Camry by nine percent to 790,000 rubles ($33,500). Last year the company sold 26,358 Camry cars in Russia Ч a 45.6 increase on 2006 figures.
Baikal Waste to Stop
MOSCOW (Bloomberg) A pulp plant controlled by Russian billionaire Oleg Deripaska will stop dumping waste into Lake Baikal, which holds about a fifth of the worldТs fresh surface water.
Baikalsk Paper and Pulp Mills, in which DeripaskaТs company Basic Element has a majority stake, agreed to activate a closed, internal drainage system by Sept. 15, eliminating the flow of waste water into the lake, the Natural Resources Ministry said Thursday in an e-mailed statement.
The ministry also gave the plant until April 28 to present a plan for reducing its Уnegative impactФ on groundwater quality. It also ordered Irkutsk regional authorities to turn on a water-filtering system in the city of Baikalsk by Aug. 15.
The plant was forced by the ministry to suspend operations for five days in December. Oleg Mitvol, deputy head of the ministryТs environmental watchdog, said Dec. 17 that the mill was pumping an УunacceptableФ amount of pollution into the lake. Baikal is the worldТs oldest and deepest lake and a UNESCO World Heritage Site.
Sturgeon Fishing Out
MOSCOW (Bloomberg) Ч The head of RussiaТs Fisheries Committee called for a five-year moratorium on sturgeon fishing in the Caspian Sea, warning that the fish, whose eggs and meat are prized delicacies, faces extinction, Interfax reported.
Russia will ask the other Caspian Sea countries Ч Iran, Turkmenistan, Kazakhstan and Azerbaijan Ч to stop fishing for sturgeon, the Russian news service said, citing Andrei Krainy. The impact on these countriesТ budgets Уwould not be large, Krainy told reporters in Moscow on Thursday, Interfax said.
Russia is ready to stop sturgeon fishing in the Caspian entirely this year. Only 24 tons of RussiaТs 50-ton annual quota allowed for scientific purposes is filled, because so few fish remain, Interfax said, citing Krainy.
By Yekaterina Dranitsyna