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Russian Foodservice: The Future of Foodservice in Russia to 2019
FS0011MR August 2015
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Single User Price: US$3,200
Summary • The ban on food imports from the EU and US in 2014 led to surge in the prices of imported food products. Consequently,
consumers will move towards more affordable restaurants, offering local and fresh food at a lower cost.
• The Restaurants will remain the dominant channel while the Workplace will be the fastest growing channel.
• The government’s efforts to promote the local food market in order to substitute food imports, will boost the Russian
Foodservices market.
• Out of the seven Profit channels, the Restaurants remains the dominant channel in terms of sales in 2014. Although the
channel will be primarily hit by the food import embargo, the sales will be driven by fast food and local coffee houses.
• Out of four Cost channels, Education channel will fuel the growth of Cost Sector foodservice sales during 2014-2019.
Scope Russian Foodservice: The Future of Foodservice in Russia to 2019 provides a detailed analysis of macro-economic factors and
the important trends within the market. The report offers detailed analysis of the market in terms of sales, outlets and
transactions. It also covers the major players in the market and regulatory scenario for the foodservice operators. Get access to:
• Macro-economic analyses and trends: GDP per capita, consumer price index, unemployment rate and age profile, which
impact the foodservice market. Consumer, operator and technology level trends are also covered.
• Foodservice market attractiveness: details and insights into the development of the foodservice sector from 2009-2019.
• Sector analysis: provides in-depth data on the valuation and development of both the profit and the cost sectors, details on the
number of outlets, transactions, average price, foodservice sales, sales per outlet, and transactions per outlet across nearly
50 sub-channels
• An overview of key players, together with insights such as number of outlets, business description and product profiles.
• Regulatory scenario insights for foodservice operators in the Russian market
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This report provides a top-level overview and detailed market and channel insights into the operating environment for
foodservice companies. It is an essential tool for companies active across the Russian foodservice value chain, and
for new companies considering entering the market.
Macro Economic Analysis and Trends
To assess the impact of economic recession and recovery on foodservice market growth. It also identifies the major
trends at consumer, operator and technology level that will shape the foodservice market and will provide a clear
picture about the future opportunities that can be explored, resulting in revenue expansion.
Foodservice Market Attractiveness
To gain the confidence to make the correct business decisions based on a detailed analysis of the Russian
Foodservice market. The report also provides historic (2009-2014) and forecast (2014-2019) view, with a special focus
on foodservice sales, outlets and transactions.
Sector Analysis- Profit Sector and Cost Sector
To have a thorough fact based analysis with information about value of the foodservice market across the channels
and sub-channels in both the sectors and the underlying factors that are driving the channel sales.
Competitive Landscape
Overview of key foodservice companies in Russia with information about their business description, product profile
and number of outlets wherever available.
Reasons to buy this report
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Macro-economic analysis: Falling oil prices and Western sanctions will further worsen the GDP per Capita
GDP Per Capita
Consumer Price Index
GDP per capita (nominal) declined by XX.X% annually in 2014
due to the devaluation of the Ruble, attributable to falling crude
oil prices in 2014. The GDP per capita is expected to fall
further in 2015 due to sustained falling oil prices and Western
sanctions* on Russia.
The consumer price index (CPI) was XX.X in 2014, up XX.X%
from the previous year. The ban on food imports from the EU
and the US has increased the prices of domestic food items
especially vegetables.
Source: Timetric
100
110
120
130
140
150
2009 2010 2011 2012 2013 2014
Co
ns
um
er
Pri
ce In
de
x
*Western sanctions- The EU and US have imposed sanctions, such as excluding Russian state banks from raising long term loans in
the EU and banning exports of dual use equipment for military use in Russia, for supporting separatists in eastern Ukraine.
**IMF- International Monetary Fund
-30%
-20%
-10%
0%
10%
20%
30%
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
2009 2010 2011 2012 2013 2014
An
nu
al G
row
th (%
)
GD
P P
er
Cap
ita (
RU
B)
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Consumer Trends: Consumer behavior shifting towards low-cost and local cuisine
Switching to low-cost restaurants
Russian consumers are shifting from full-service and fine-dining
restaurants to low-cost eateries such as QSRs, local coffee houses, and
street food outlets. Rising inflation and the depreciating Ruble have
impacted consumer purchasing power, leading Russian consumers to cut
back on eat-out frequencies in high-end restaurants. The real wage
growth in Russia slowed down from XX.X% in 2012 to XX.X% in 2013,
and in August 2014 it fell by XX.X%, for the first time since 2009, due to
rising inflation rates. This has resulted in declining consumer purchasing
power. Consequently, consumers prefer fast food outlets that serve fresh
food at a lower cost.
Shifting to local cuisine
International cuisines such as French, Italian, American, and Japanese
restaurants are very popular in Russia. Approximately XX.X% of food
products are imports from the EU and the US. For example, pork
(imported from Germany, Denmark, France and Canada), fish and sea
food (Norway), fruits (Poland), poultry (the US), and cheese (Finland and
Netherlands). The ban on food imports from the EU and US in 2014 led
to soaring prices for these products, which arrived indirectly in Russia
through intermediate countries. Therefore, Russian consumers are
heading towards more affordable restaurants, offering local Russian,
Georgian, and Uzbek cuisine.
Switching to low-cost restaurants
Rising inflation and depreciating Ruble leading to falling consumer purchasing power
Shifting from international to local cuisine
Due to soaring prices of imported food products Russians are heading towards local cuisine
Stimulating health & wellness trend
Unavailability of Western processed food created an unexpected health boom among Russians
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Despite the economic and political crisis, the Russian Foodservice industry grew at a CAGR of XX.X% during 2009-
2014 and valued RUBXX.X billion (US$XX.X billion) in 2014. The growth of the low-cost fast food/street food market
will alleviate the impact of Western sanctions on the Russian Foodservice market. Furthermore, the government’s
efforts to promote the local food market in order to substitute food imports, will boost the Russian Foodservices
market, which is forecast to grow at a CAGR of XX.X% during 2014-2019.
The Profit sector accounted for the majority share, at XX.X0% of total Foodservice sales in 2014, and is forecast to
increase marginally, to XX.X% of total sales by 2019. The Cost Sector accounted for the remaining XX.X% share in
2014.
Foodservice: The food import embargo will boost local production and, lower food prices leading to favorable conditions for Russian Foodservice market
Russian Foodservice: Overall Sales (RUB
Million) & Annual Growth (%), 2009–2019
Russian Foodservice: Sales by Sector (%),
2014 vs. 2019
0%
2%
4%
6%
8%
0
500
1,000
1,500
2,000
2,500
3,000
200
9
201
0
201
1
201
2
201
3
201
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201
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201
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201
9
An
nu
al G
row
th (%
)
Fo
od
serv
ice S
ale
s in
RU
B B
illi
on
Profit
Cost
2019
2014
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Although Restaurants will remain the dominant food service channel, accounting for XX.X% of total
Foodservice sales in 2014, consumer behavior will shift from high-end restaurants to less expensive
Foodservice options, such as local coffee houses and street side food outlets.
Furthermore, Workplace will be the fastest growing channel, at a CAGR of XX.X% during 2014-2019,
followed by the Accommodation (XX.X%) and Retail (XX.X%) channels. International sports events such as
the Winter Olympics, Russian Grand Prix, and FIFA World Cup will stimulate the tourism market and
contribute to the significant growth of the Accommodation Foodservices channel.
Restaurants will remain the dominant channel driven by less expensive local coffee houses and street food
Bubble size = 2014 Sales
-2%
1%
4%
7%
10%
13%
-2% 1% 4% 7% 10% 13%
Sale
s in
RU
B M
illi
on
CA
GR
(%
) 2014
-2019
Sales in RUB Million CAGR (%) 2009-2014
Comparative growth analysis by channels, 2009-2014 vs. 2014-2019
Restaurants
Pub, club and bar
Travel
Workplace
Healthcare
Retail
Accommodation
Military & civil defense
Education
Leisure
Welfare & services
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Profit sector sales by channels: International events will drive the tourism market and consequently Accommodation Foodservice sales
Accommodation- Sales (RUB) and sales growth (%)
Sales and Sales Growth by Channels, 2009–2019 (in RUB)
Leisure- Sales (RUB) and sales growth (%)
Accommodation Foodservice sales are forecast
to grow at a CAGR of XX.X% during 2014-2019.
Hotel & Motel is the largest sub-channel at RUB
XX.X billion (US$XX.X billion) sales in 2014, and
is forecast to grow at a CAGR of XX.X% during
2014-2019. Bed & Breakfast will be the fastest
growing sub-channel, forecast to grow at a
CAGR of XX.X% during 2014-2019.
Leisure Foodservice sales are forecast to grow
at a CAGR of XX.X% during 2014-2019. Visitor
Attraction is the largest sub-channel, at
RUBXX.X billion (US$XX.X billion) sales in 2014
and is forecast to grow at a CAGR of XX.X%
during the same period. Entertainment will be the
fastest growing sub-channel, at a CAGR of
XX.X% during 2014-2019.
-30%
-10%
10%
30%
0
25
50
75
100
125
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
201
9
An
nu
al G
row
th (%
)
Sale
s (
in R
UB
Bil
lio
n)
Hotel & Motel Holiday Park Guest House
Hostel Bed & Breakfast % Annual Growth
0%
3%
6%
9%
12%
15%
0
10
20
30
40
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
201
9
An
nu
al G
row
th (%
)
Sa
les
in
(R
UB
Bil
lio
n)
Visitor Attraction Entertainment Venue % Annual Growth
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Cost Sector outlets by channels: Tertiary sub-channel will drive the Educations outlets
Education - Outlets and Sales per Outlet by Channel (RUB)
Outlets and Sales per Outlet by Channel (in RUB)
The number of outlets for the Education channel
is forecast to grow at a CAGR of XX.X% during
2014-2019, while sales per outlet for the channel
are forecast to grow at a CAGR of XX.X% during
the same period. The Further Education sub-
channel will register the highest growth in terms
of sales per outlet, at a CAGR of XX.X% during
2014-2019, while the Tertiary sub-channel is
forecast to register the highest growth in terms of
number of outlets, at a CAGR of XX.X% during
2014-2019.
Healthcare – Outlets and Sales per Outlet by Channel (RUB)
The number of outlets for the Healthcare channel
is forecast to decline at a CAGR of XX.X%
during 2014-2019, while the sales per outlet for
the channel are expected to grow at a CAGR of
XX.X% during the same period. The Medical
Center sub-channel will register the highest
growth in terms of sales per outlet, at a CAGR of
XX.X% during 2014-2019, while the Hospital
sub-channel will register the highest growth in
terms of number of outlets, at a CAGR of XX.X%
during the same period. Bubble size = Number of Outlets 2014
-3%
0%
3%
6%
9%
-3% -1% 1% 3% 5% 7% 9%
Ou
tlets
by C
ha
nn
el C
AG
R (
%)
2014-2
019
Sales per Outlet by Channel CAGR (%) 2014-2019
Pre-School
Primary School
Secondary School
Training Centre
Further Education
Children's ActivityCentre
Tertiary
-3%
-1%
1%
3%
5%
-3% -1% 1% 3% 5%
Ou
tlets
by C
ha
nn
el C
AG
R (
%)
2014-2
019
Sales per Outlet by Channel CAGR (%) 2014-2019
Medical Centre
Hospital
ResidentialCare
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Competitive Landscape – Key players
Leading Foodservice players in Russia
Company Name 2014 Number of
Outlets Overview Product Portfolio
Subway XX
Subway is a US based
QSR chain, and opened its
first outlet in Russia in
1994.
The product menu includes
sandwiches, salads, rolls,
beverages, and desserts.
Shokoladnitsa XX
Shokoladnitsa is a Russia
based coffee chain.
The product menu includes hot
dishes, appetizers, salads,
desserts and beverages.
McDonald’s XX
The US based fast food
chain, McDonald's, opened
its first outlet in Russia in
1990.
The product menu includes
burgers, fries, desserts, and
beverages
Source: Company Websites & Secondary Research
Appendix - Profit Sector Outlets
Channel Sub-Channel 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Accommodation
Bed and Breakfasts
(B&B)
Guest Houses
Holiday Parks
Hostels
Hotels and Motels
Leisure
Entertainment
Venue
Visitor Attractions
Pubs, Clubs and
Bars
Pubs and Bars
Private Member and
Social Clubs
Nightclubs
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Market Data Methodology: Foodservice Market Data is created by the consistent application of robust research across all channels
Creating Robust, Consistent & Comparable Results through:
100% Standardized Definitions 100% Standardized Processes
Phasing work by channel by country Systematic Senior Management Review
1. Baselines Developed using Internal Research Resources
• Socio-economic and demographic databases
• Historic market databases and reports
• Company database and Foodservice database
2a. Industry Research:
Extensive Desk Research (Ongoing)
• Industry and trade research
•Reports published by international
organisations
• National statistics and other publically
available sources
• Expert Opinion: Collation of opinion
taken from journalist interviews of
leading industry figures
Top-down
cross-checks
Bottom-up
data creation
Data
Finalization
3. Marketing Modeling & Analyst
Triangulation
•Modeling of any gaps in data from
previous two research phases
•Consolidation and verification of inputs
for creation of models to benchmark
data across sectors and geographies
• Forecasting
• Triangulation and Conflict Resolution
•Review by Senior Project Managers
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Key Foodservice Definitions
Term Definition
Foodservice
Foodservice is defined as the cost of all food and drink, including on-trade drinks not drunk
with food, for immediate consumption on the premises or in designated eating areas shared
with other foodservice operators, or in the case of takeaway transactions, freshly prepared
food for immediate consumption. Foodservice is restricted to the sale of food and drink in
specific foodservice channels defined below and excludes vending machines.
Profit Sector
A number of foodservice channels have been grouped together to be termed the 'Profit
Sector’. These include Accommodation, Leisure, Restaurants, Retail, Travel, Workplace,
and Pubs, Clubs and Bars. Neither operators nor consumers, or companies in the case of
the Workplace channel, typically receive a subsidy for the foodservice transaction, and
largely represent non-state foodservice operations.
Cost Sector
A number of foodservice channels have been grouped together to be termed the 'Cost
Sector'. These include Healthcare, Education, Military and Civil Defense, and Welfare and
Services. This sector typically represents the state’s foodservice operations.
Food Transactions
The total number of visits by individuals to foodservice locations that involve the
consumption of either food, or food and drink. Drink-only transactions are excluded from
transaction data, but covered in sales data; if several people visit one location at once and
there is only one bill, such as a group dining in a restaurant, the number of transactions is
counted as being one for each person in the group. The concept of ‘meals’ is broadly
analogous to transaction data, less a typically very small amount for snack-only
transactions.
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Related Reports
• Japanese Foodservice: The Future of Foodservice in Japan to 2019
• Spanish Foodservice: The Future of Foodservice in Spain to 2019
• French Foodservice: The Future of Foodservice in France to 2019
• German Foodservice: The Future of Foodservice in Germany to 2019
• Chinese Foodservice: The Future of Foodservice in China to 2019
• The UK Foodservice: The Future of Foodservice in the United Kingdom to 2019
• Italian Foodservice: The Future of Foodservice in Italy to 2019
• Turkish Foodservice: The Future of Foodservice in Turkey to 2019
• Austrian Foodservice: The Future of Foodservice in Austria to 2019
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Executive Summary
Macro Economic Analysis and Trends Macroeconomic Analysis
Consumer Trends
Operator Trends
Technology Trends
Foodservice Market Attractiveness Market Size and Forecasts
Market Share split by Profit Sector and Cost Sector
Profit Sector Analysis Profit Sector Analysis by Channels & Sub-channels- Sales Analysis, Outlet Analysis and Transaction Analysis • Accommodation - Bed & Breakfast, Guest House, Holiday Park, Hostel, Hotel & Motel
• Leisure – Entertainment, Venue, Visitor Attraction
• Pub, Club & Bar – Pub & Bar, Private Member & Social Club, Nightclub
• Restaurants - Full Service Restaurant, Quick Service Restaurant & Fast Food, Coffee & Tea Shop, Ice Cream Vendor
• Retail – Baker, Convenience Store, Delicatessen, Department Store, Garden Centre, Other Retail, Service Station Forecourt,
Supermarket & Hypermarket
• Travel – Air, Rail, Sea
• Workplace - Government Department & Local Authority, Industrial, Retail, Financial & Office Based
Cost Sector Analysis Cost Sector Analysis by Channels & Sub-channels- Sales Analysis, Outlet Analysis and Transaction Analysis • Education - Children’s Activity Centre, Further Education, Pre-School, Primary School, Secondary School, Tertiary, Training Centre
• Healthcare – Hospital, Medical Centre, Residential Care
• Military & Civil Defence - Military Overall, Police & Emergency Service
• Welfare & Service - Other Welfare & Service, Prison, Welfare Meal
Competitive Landscape Company Overview , Product Portfolio and Number of Outlets
Regulatory Scenario
Appendix
Table of Contents
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Appendix
Profit Sector Outlets
Cost Sector Outlets
Profit Sector Transactions (Million), 2009-2019
Cost Sector Transactions (Million), 2009-2019
Profit Sector Sales (RUB Billion), 2009-2019
Cost Sector Sales (RUB Billion), 2009-2019
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List of Figures
Figure 1: GDP per Capita, 2009-2014 Figure 2: Consumer Price Index, 2009-2014 Figure 3: Unemployment Rate, 2009-2014 Figure 4: Age Profile, 2014 Figure 5: Russia Foodservice: Overall Sales (RUB Million) & Annual Growth (%), 2009-2019 Figure 6: Russia Foodservice: Sales by Sector (%), 2014 vs. 2019 Figure 7: Comparative Growth Analysis by Channels, 2009-2014 vs 2014-2019 Figure 8: Profit Sector: Channel share (%), 2014 vs. 2019 Figure 9: Profit Sector: Average Transaction Price (RUB), 2009-2019 Figure 10: Profit Sector: Comparative Growth Analysis by Channels, 2009-2014 vs 2014-2019 Figure 11: Accommodation- Sales (RUB) and sales growth (%), 2009-2019 Figure 12: Leisure- Sales (RUB) and sales growth (%), 2009-2019 Figure 13: Pub, Club & Bar- Sales (RUB) and sales growth (%), 2009-2019 Figure 14: Restaurants - Sales (RUB) and sales growth (%), 2009-2019 Figure 15: Retail - Sales (RUB) and sales growth (%), 2009-2019 Figure 16: Travel - Sales (RUB) and sales growth (%), 2009-2019 Figure 17: Workplace - Sales (RUB) and sales growth (%), 2009-2019 Figure 18: Profit Sector: Comparative Growth Analysis by Channels, Sales per Outlet & Number of Outlets, 2009- 2014 vs 2014-2019 Figure 19: Accommodation - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 20: Leisure - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 21: Pub, Club, and Bar - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 22: Restaurants – Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 23: Retail – Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 24: Workplace - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 25: Profit Sector: Comparative Growth Analysis by Channels, Transactions per Outlet & Number of Transactions, 2009- 2014 vs 2014-2019
Table of Contents
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List of Figures
Figure 26: Accommodation - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 27: Leisure - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 28: Pub, Club, and Bar - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 29: Restaurants - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 30: Retail - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 31: Workplace - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 32: Cost Sector: Channel share (%), 2014 vs. 2019 Figure 33: Cost Sector: Average Transaction Price (RUB), 2009-2019 Figure 34: Cost Sector: Comparative Growth Analysis by Channels, 2009-2014 vs 2014-2019 Figure 35: Education- Sales (RUB) and sales growth (%), 2009-2019 Figure 36: Healthcare- Sales (RUB) and sales growth (%), 2009-2019 Figure 37: Military & Civil Defense - Sales (RUB) and sales growth (%), 2009-2019 Figure 38: Welfare & Services - Sales (RUB) and sales growth (%), 2009-2019 Figure 39: Cost Sector: Comparative Growth Analysis by Channels, Sales per Outlet & Number of Outlets, 2009- 2014 vs 2014-2019 Figure 40: Education - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 41: Healthcare - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 42: Military & Civil Defense - Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 43: Welfare & Services – Outlets and Sales per Outlet by Channel (RUB), 2009-2019 Figure 44: Cost Sector: Comparative Growth Analysis by Channels, Transactions per Outlet & Number of Transactions, 2009- 2014 vs 2014-2019 Figure 45: Education- Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 46: Healthcare - Transactions and Transactions per Outlet by Channel, 2009-2019 Figure 47: Welfare & Services - Transactions and Transactions per Outlet by Channel, 2009-2019
Table of Contents
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List of Tables
Table 1: Leading Foodservice players in Russia, 2014 Table 2: Profit Sector Outlets, 2009-2014 Table 3: Cost Sector Outlets, 2009-2014 Table 4: Profit Sector Transactions (Million), 2009-2014 Table 5: Cost Sector Transactions (Million), 2009-2014 Table 6: Profit Sector Sales (RUB Billion), 2009-2014 Table 7: Cost Sector Sales (RUB Billion), 2009-2014 Table 8: Key Foodservice Definitions Table 9: Profit Sector Definitions Table 10: Cost Sector Definitions
Table of Contents