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Main article: Russian economy
2023: Market turnover growth by 1.4% to RUB 2.9 trillion
The turnover of the franchise market in Russia in 2023 reached 2.9 trillion rubles, which is 1.4% more than a year earlier. Similar growth rates were observed in 2022, and in 2021 they were measured + 5.3%. Such data in the analytical agency BusinesStat published in February 2024.
According to the study, the growth dynamics of the Russian franchise market in 2022-2023. decreased due to the departure of several large foreign companies, including McDonald's and Starbucks. Another barrier was the economic downturn, but neither in 2022 nor in 2023 the franchise market decreased due to the sale of Russian assets of foreign companies to local entrepreneurs, as a result of which the chains of stores and restaurants continued to work.
BusinesStat notes that global brands saw great potential in the Russian Federation and were ready to invest in franchise projects in order to expand their presence in the country. These projects stimulated the development of domestic franchise companies and contributed to improving the quality and growth of the number of franchises offered.
Legislative changes have made a significant contribution to the development of the Russian franchise market. Thus, the authorities continued to take measures that contribute to the development of entrepreneurship, including support for franchise projects. Improving the legal field, reducing barriers and facilitating the procedure for registering franchising have turned this area into a more attractive area for entrepreneurs, analysts add.
They also noted that the largest rise in the Russian franchise market occurred in 2020-2021, when, against the backdrop of the COVID-19 coronavirus pandemic, the number of points of issue of orders in the country grew and there was a surge in demand for food and food delivery services.[1]
2022
Food Retail Enters Top Three Franchise Market
FMCG - retail became the second most important franchise in the Russian market with a share of 14.9%. This is the only industry that was able to increase it by the end of 2022. Such data are provided by RBC. Markets Survey published December 6, 2023.
At the end of 2022, the volume of the franchise market in Russia amounted to 2,397 billion rubles, increasing the indicators of 2021 by 22.3%. The largest share in it is owned by catering enterprises, but in 2022 it decreased by 3 percentage points. due to the departure from Russia of a number of large chain enterprises. The second in volume was franchising in the field of FMCG retail - over the past 10 years, the industry has consistently shown positive dynamics in revenue growth. The stability of the sphere also guarantees the absence of sharp spikes in demand, accompanied by further stagnation, which is typical, for example, for the post-pandemic medical services market.
At the same time, the number of players who offer their franchises in the field of FMCG retail is still limited, and the main turnover is generated at the expense of large companies. The only retailer in the top ten most desirable franchises with which, according to surveys of entrepreneurs, Russians would like to build a business, was the Pyaterochka retail chain. Experts also recommend it: the network has the largest coverage in Russia, it works according to the reverse franchising model (this simplifies the processes for franchisees), has the optimal payback period (from 18 months), and the minimum amount of investment in its case coincides with the expectations of potential entrepreneurs.
In general, entrepreneurs confirm interest in food retail in terms of acquiring a franchise. According to a RBC survey, FMCG retail was among the TOP-3 most sought-after franchises along with PVZ and medical services. It is noteworthy that those who have already been associated with franchising are ready to invest in a new franchise business at least three times more than those who have never been associated with this area. As the main advantages of acquiring a franchise in food retail, the respondents indicated: the presence of business standards, marketing support and work under the wing of a strong brand.
The total number of franchises increased to 5.5%, and turnover by 19% to 2.78 trillion rubles
Domestic projects were able to compensate the Russian market for the loss of foreign franchises: their total number in 2022 increased by 5.5%, and turnover - by 19%, to 2.78 trillion rubles. Demand for local franchises increased by 70%.
The expansion of Russian projects abroad has slowed down, but is already actively redirected to "friendly countries": players attract franchisees to open points in the UAE, Turkey and the CIS.
Named the most popular franchises in Russia
Forbes magazine ranked the most popular franchises among entrepreneurs in the first nine months of 2022. The data were released in mid-November 2022.
The most popular franchise was retailer Ozon. According to the publication, since the beginning of the year, 2,650 partner points for issuing orders have been opened in Russia. The Avocado grocery chain has become the second most popular franchise. The number of outlets of this brand has increased by 1230 since the beginning of 2022. The most unclaimed was the 2GIS electronic directory franchise - in nine months not a single new partner business was opened under this brand.
Experts evaluated franchises according to the following criteria: average annual revenue of one point, ROI (ratio of profitability or loss-making of the business), payback period, profitability and a new indicator - quantitative growth of the partner network for nine months of 2022 (difference between open and closed points). In the list of 30 companies, they are grouped by the volume of investments for the opening of one point and ranked taking into account the collected information.
According to experts interviewed by the publication, in 2022 the dynamics of the franchise market in Russia directly correlated with geopolitical events. In March 2022, against the background of the outbreak of hostilities in Ukraine, market participants "chose wait-and-see tactics" and refused to invest in projects, which is why interest in buying a franchise decreased by 30%. After the announcement in September 2022 of partial mobilization in the franchise market, almost 70% of transactions fell through, which is also due to the massive departure of the target audience of franchises from Russia.
In addition, interest in franchises that worked on the territory of shopping centers was reduced to the minimum level. This trend is associated with the departure of key tenants from shopping centers.[2]
The share of Russian franchises increased to 87.5% in the first half of the year
2021
The number of franchises in Russia increased by 11.3%, to 3095
The number of franchises in Russia at the end of 2021 increased by 11.3% and reached 3095. This is evidenced by the data of the Franshiza.ru edition, published in mid-February 2022.
During 2021, about 480 new franchises appeared in Russia, 165 franchises left the market. Basically, among the new franchises of 2021, small regional concepts created, including with the support of local administrations within the framework of the national program for the development of entrepreneurship. Also among the newcomers to the market there are large companies that have not previously considered franchising for themselves. Notable players who launched the franchise in 2021 include PEC, Zotman pizza, Car price, Fingram, Simargl Electro.
As of the beginning of 2022, 20% of Russian franchisors are registered in Moscow, 8% in St. Petersburg, the remaining 72% in the regions, most of them are in Novosibirsk, Omsk, Tyumen and Nizhny Novgorod.
39% of enterprises have points outside Russia, mainly in the CIS countries such as Kazakhstan, Belarus and Uzbekistan. For comparison, in 2019, the share of companies with franchise points outside the country was 48%. Due to the large appearance of newcomers, the percentage fell, as many enterprises begin their development primarily in Russia.
Among Russian franchisors, about 74% are organized as LLC, the remaining 26% work and conclude contracts with franchisees as individual entrepreneurs. About half (49%) of franchises work in the segment of services for business and the population, 24% - in catering, 15% - in non-food retail, 8% - in grocery retail and 4% - in production. The most active growth in the franchise market was observed in the segments of medicine, delivery, dark kitchen and small supermarkets, the study said. Stagnation continued in unproductive retail and the event-sphere, the growth rate slowed down compared to pre-pandemic in children's education and education.[3]
KFC and McDonald's become franchise leaders
The annual non-profit ranking of popular franchises from the Businessmens.ru catalog demonstrated how business demand has changed for 2021. This became known on April 22, 2022. People started buying more expensive franchises. The average amount of investments in franchises from among the top 10 of the rating increased to 21.6 million. rubles Although after pandemics this figure barely reached 15.6 million rubles. Last year's leaders passed their positions - the franchise of the points of issue of orders of the marketplace Wildberries moved from first to fifth place. Fell two positions. Ozon Discounters are still popular. Fix Price climbed to fourth place, "" Dobrozen (The Right Choice) opened even more points than in the previous period, and the newcomer of the rating settled in ninth place - the franchise of the MPR low price store.
The rating is not for profit, compiled on the basis of data from more than 3,000 companies and created as a free tool, the purpose of which is to give an objective assessment of the popularity of the franchise market in Russia.
The unconditional leaders were the franchises of the fast food giants KFC and. McDonald’s But, given what is relevant for information foreign brands, this may be the last year of their triumph. "" Five slightly lost its position - the domestic company got third place, although two years ago it headed the list of the most popular. She managed to stay in the lead and "," Dodo Pizza taking tenth place.
A significant increase in the popularity of self-service coffee franchises is noticeable. Topping the second ten is Lifehacker Coffee, which managed to launch more than 2,900 locations in one year. Although in 2021 the brand was not even in the top 50 of the rating. The Hohoro franchise climbed from 23rd to sixteenth place, with 1,714 contracts.
The success of the World Class fitness club speaks of the restoration of interest in the fitness industry. Despite the fact that this is one of the most investment-intensive franchises, the company managed to open six new clubs and get into the TOP-20.
The pandemic boom for the opening of points of issue of orders begins to gradually subside. This is evidenced by the statistics of Wildberries and Ozon. However, the popularity of this type of business is still high. So, for example, the number of additional PVZ points transport of the company SDEK is only slightly inferior to the indicators of the past rating. The company launched about 900 branches in a year.
The same situation with the medical business. The popularity of pharmacy franchises and laboratory diagnostics still allows brands to be in high positions. So, "Soviet Pharmacy" practically without slowing down the growth rate launched 93 new representative offices. The Invitro brand managed to open 137 points, and Gemotest - 144.
In general, the results of franchising over the past period show positive trends. The increased popularity of more expensive franchises, as well as the quantitative indicators of brands, reflect the processes of rapid recovery and active actions of companies after the 2020 pandemic. And the more relevant the results of the rating become. Given the changes in the global market in 2022, the results of many franchise networks will be a vivid reflection of who and how will cope with the difficulties.
2020
Notes
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