CURRENT STATE AND KEY TRENDS IN DEVELOPMENT OF THE FMCG MARKET IN RUSSIA

Abstract

The improvement of some macroeconomic indicators of the development of the Russian Federation, including the increase in nominal incomes of the population, resulted in a noticeable growth in the indices of consumer confidence and optimism, what should have been reflected in the dynamics of the main indicators of the FMCG market. This article presents the results of the analysis of the current state of the FMCG market in Russia and the main trends in its development. The study was conducted on the basis of Rosstat data and the reporting indicators of the activities of retail enterprises, presented in the public domain. The following market trends were identified: development of the e-commerce segment (e-Grocery) based on the use of an omnichannel model and the advancement of their own delivery services and other digital areas by large retailers; gradual consolidation of the market by large retailers (PJSC ‘Corporate Center X 5’, PJSC ‘Magnit’, LLC ‘Lenta’) through M&A transactions (transactions to combine the assets of two companies); reduction in the share of hypermarkets and supermarkets in the structure of retail space and a shift in retailers' priorities towards small formats (‘soft’, ‘hard’ discounters and ‘convenience’ stores), as more efficient due to their reach to a larger audience and a reduction in operating costs as a result of the application of the lean manufacturing concept. The impact of these trends on the end consumer is currently defined as mainly positive, despite the expectation of negative consequences of market consolidation, such as risk of changes in local product range and pricing policy.