RUSSIA: Tengelmann entering Russia with Plus Discount | Progresiv
Having divested from Central Eastern Europe (Poland, Czech Republic, Slovakia, Hungary, Greece, Romania and Bulgaria) between 2007 and 2010, Tengelmann’s Plus discounter is returning, launching its first store in Russia. 
With an investment of EUR500 m, Tengelmann plans to open around 150 Plus stores in Central Russia by 2020. The first three stores will be opened in the cities of Kaluga, Tula and Podmoskovye. In total the retailer plans to open around 10 stores in the Tula region. Further stores openings are planned for Tver, Nishnyi Novgorod and Pushkino.
Plus discount stores will offer around 2,500 items, including fresh product categories, food, health & beauty products, but also non-food ranges like toys and clothing.
Central Russia has massive potential for new store openings as consumer spending is above Russia's average and competition is still low. Nevertheless, Magnit, X5 Retail Group and Dixy Group will be expanding in this region too; X5 Retail Group has already launched a new Pyaterochka discount concept. (see our store visit here)
Russia's poor economic outlook offers an opportunity for a discount concept like Plus. However, Plus will have to come up with a different strategy than it pursued in Central Eastern Europe a decade ago. It will have to rely on local producers and imports from non EU countries as the ban on imports of certain fresh product categories has not been lifted. Local sourcing of private label products rather than their import from EU could be a challenge. (www.retailanalysis.igd.com)
