Russia with high potential market in clothing
Russia is one of the largest countries in the world. It is located at high latitudes, and most parts of the country are cold and low rainfall. That’s why most of the country (especially the big Siberian land) is vacant, and agriculture is not possible in these areas. Russia’s capital is a city in Moscow, which is in the west and the European part of the country, and is Europe’s largest city.
Russia, with about 143 million people (in 2013), was the ninth most populous country in the world. Also, the population growth rate in the country is negative. Most of the Russian population lives in the western part of the country (European part). According to the 2010 census, about 81 percent of the country’s population is of Russian ethnic origin. A total of 160 ethnic groups live in this country. Tatars make up 3.9 percent of the Russian population and are considered the largest ethnic minority in the country.
Before the eighteenth century, Russia was a not-so-strong state in Eastern Europe, and its size was not so large. Until the beginning of the 18th century, with the reforms made by the great Tsar Peter, this country became a vast empire. In 1917, the communist revolution took place in the country and the name of the country changed to the “Soviet Union of Soviet Socialist Republics”. Russia, the Russian Federation of Soviet Federations, was the most important and largest republic in the Soviet Union. In 1991, the Soviet Union collapsed with the West after the Cold War and replaced the Russian Federation.
Russia is a fairly big market place, and many merchants of the world are willing to export to Russia, but the specific complexity of the Russian market, the need for physical presence, high costs and lack of access to accurate and reliable information, prevent their successful presence in Russia.
It is not easy to communicate with Russians, and Russian companies are hardly responding to foreign correspondence and conversations. The Russians prefer to deal with local companies (Russians), so that their contractor, himself, bothering to transport, clear and import, and buy them only domestic (in rubles).
Keep in mind that only 12% of Russian companies can import. This means that if you cannot ship the goods in Russia warehouse and locally (DDP) to the customer, you have a very low chance and you lose 88% of the market and the possibility of exporting to Russia.
Therefore, you need to trade through a professional company and a contractor for trading with Russia and supplying products such as clothing to this country. Companies that are contracting with foreign companies from all over the world can do this.
Methods of presence in the Russian market
In general, there are three methods and strategies for engaging in the Russian market. Depending on your chosen method, our services are as follows.
It is appropriate for people who do not care about the Russian market and are not willing to take risks. This method has little risk and certainly less success.
In this way, a small amount of money is deposited. The businessman is not affiliated with any Russian person or company and has commercial autonomy. But keep in mind that the Russian Socialist Republic is not a correspondent with English and should be more closely associated with Russian. Russians do not trade through email and phone calls, and most would like to be in contact with the exporter of goods. Also, if you are very likely to contact them, they will ask you to deliver the goods on Russian soil and also pay for the goods in your national currency, rubles. It should be noted that you should not be afraid of remote scams.
Intermediary presence in Russia
Suitable for those who are important to the Russian market. In this way, the risk and chance of success will be greater. You can more easily understand your customers and know their needs, but there are still interfaces that guarantee your success and you need to have a very professional and professional interface. You are more comfortable with Russian culture and you can choose a familiar interface with the Russian culture and do the export operations. The Russians love to buy their goods from a homeland. So try to get this interface from your own country. But in this way, keep in mind that the smallest mistake is to separate the interface from your collection, and thus can also eliminate your success. Also, it’s a bit difficult to choose a representative and a loyal and loyal companion, and maybe after a while you will step back from working with you and bankrupt at the peak of your success.
Direct presence in Russia
It is suitable for people who are determined to be present in Russia. Certainly, in this way, you will be more likely to succeed and you will always have a higher percentage of risk, along with many odds, and you must be a real risky person so you can increase your success. In this way, everything is under your control and you can do first-hand knowledge of customers and the market. Certainly, the most heartfelt person to market products, you are yourself, and no representative is so compassionate about your work. In this way, you should be in Russia repeatedly and take action on marketing. Maybe these costs are a bit exorbitant and not cost-effective. You also need to spend a lot of time marketing and you need a professional business translator who certainly costs a lot. As a result, somewhat mistakenly leads to the loss of potential customers, which may cause a lot of damage to the business.
In this situation, the choice of a professional company in business with Russia seems to be much more efficient. You can sign a cooperation agreement with a professional company and deliver your products through its marketers in Russia. In fact, you save time and money, and the company is obligated to cooperate with you in the context of your contract. It should be noted that more marketing by that company will make it more profitable and this will also lead to your success.
Steps to export to Russia
Exports and sales of goods in foreign markets have certain specificities and sensitivities, and the lack of attention to them may waste human and financial investment in this regard. Exports, like any other business, require prospecting, planning, familiarizing with scientific methods, moving and attracting the confidence of foreign buyers. The stages of exporting goods can be listed as follows:
The first and most important step in exporting is marketing. Marketing means recognizing foreign markets and ways of influencing it: achieving this recognition by negotiating with buyers, using official information and statistics, participating in international exhibitions, contacting business advisors at embassies and chambers of commerce, as well as inquiry It is possible from international institutions and centers providing services. Also, identification of rival goods and their quality and price in the market and the use of promotional methods for introducing goods plays an important role in the success of an exporter.
Issuance of pre-invoice
The exporter must send the developer or pre-invoice containing the merchandise and its seller’s details to the buyer. Buyers and buyers may compare their products with competitors, and then consider purchasing products in their purchasing decisions. Therefore, pre-invoices are considered as the most important export sectors.
Procurement and packaging
At this stage, the exporter must pack the goods and, in accordance with the agreed terms, package. Packaging quality can also enhance customer satisfaction and can bring new customers to your collection. Take advantage of professional designers in this area.
Determine the export price
The exporter must refer to the pricing commission to determine the price of its export goods. The commission consists of representatives of the Ministry of Commerce, the Export Development Center (the current development business organization), the Ministry of Industry, the Customs of the Origin of the Origin and the Central Bank.
Typically, the gateway is traded in the country of origin and destination. Each country has specific customs rules that you must comply with at source and destination. Also, in customs, you may receive a lot of shipping fees or goods entering a new country, which should also be considered for export.
Insurance of goods and shipping
Transit is usually carried out by sea, air or land, each with specific incidents. So try to insure your merchandise before you send a product, so you can cross out the incident through the famous insurers. Then apply for export of goods.
Some characteristics of the Russian market
- The Russian market is consumed, and in some areas it is up to 85% of the consumer’s imported products.
- Russian consumers are paying attention to quality before quality.
- Consumers in Moscow tend to have new products, while consumers in St. Petersburg are more conservative in this regard.
- The supermarket stores have a significant influence on the retail distribution network in Russia.
- Foreign products face three barriers to trade barriers (tariffs, licenses, etc.) with distributors (paperwork) and product costs.
- Packaging has a direct impact on sales.
- Participation in Russian exhibitions is useful for finding business partners.
- Russia has a slow process of bureaucracy, which will increase the cost of the product.
- The slow process of administrative bureaucracy in Russia has led to payments being made to accelerate the administrative process.
- Sometimes entering a Russian market with a new product is easier than taking the current market share of other competitors.
- If you do not have the ability to supply and compete in the major cities of Russia, you should choose small geographic areas for supply.
- Despite the difficulties, entry into the Russian market is harder than entering the European markets such as France.
- The Russian market, as well as any other market has its own rules and characteristics, know and consider them.
Special Economic Regions of Russia
Industrial production areas and regions focusing on R & D and advanced technologies will benefit from lowering land and property taxes and forgiving import and export duties. Imports to these areas are exempt from customs duties and VAT. If imported goods are consumed in the special economic zone, they are exempted from customs duties and value added tax, but they are taxable at departure. Exports of re-imported goods to non-processed areas are exempted from export duties. Some regions of Russia have begun to create free customs and free warehouses to encourage investment. These warehouses and customs areas are at airports, ports, railway stations and shipping terminals. There are no customs duties in these areas, and general public transactions are free. But retail is prohibited and there is no time limit for the goods warehouse. The Special Economic Zone Management Agency announced the creation of a technology park in Novosibirsk, Tyumen, Kazan, Nizhny Novgorod and Obinisk. In December 2006, the tender for the creation of seven special economic zones was held, including in Krasnoyarsk, Stavropol, Altai, Kolingrad and Irkutsk.
Customs duties in Russia apply to most imported products. Most Russian entry rates are based on the value of the goods. On the other hand, there are special effects on a number of imported products based on their volume, weight or quantity. Some commodities have combined effects that include multiple rates. Russia’s customs tariff varies from 100% for alcoholic beverages to 0% for imported goods of prevailing quality. On average, incoming rates are between 5% and 20% of the customs value of the goods.
The basic rates specified in the regulations apply to countries that have been awarded the Principal State of the Provisional Law. Some imported goods from developing and less developed countries to Russia are also calculated at 75% of the base rate (25% off) or zero percent. However, these products are mainly limited to raw materials and handicrafts. Goods produced in third countries are subject to tolls at double the base rate. Items such as transit products, imported items for personal use (worth not more than $ 2,500 and weighing more than 35 kilograms), cultural products, vehicles used for cargo and passengers, and humanitarian aid in Russia Payment of customs duty is exempted. The cost of the customs process in Russia is between 3 and 15 thousand euros for each customs declaration, which is based on the customs value of the imported goods. Customs payments are made in Russia in general or at the same time as customs declaration is presented to customs.