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Things Russians buy and save on in 2021

Agroinvestor magazine published an analytical article about the changes in consumer preferences of Russian citizens during the global economic crisis. The authors talked to producers, sellers, and economists about whether the demand for food products decreased and found out which positions became less and which became more demanded on the market. Among the invited experts of the magazine was Larisa Yerina, the Director for Sales at ECO-Culture holding.

Even though people’s incomes have fallen and there have been restrictions imposed by the pandemic, the demand for food products in Russia has not decreased significantly. Partly, this was due to the border closures, as Russians were forced to spend their money at home rather than abroad. However, analysts note that consumption patterns have become more conscious, with consumers paying more attention to inexpensive and healthy products.

The drop in demand was not substantial also due to the financial support provided to the population by the state. In general, people have indeed begun to save money but not on basic foodstuffs. All retail chains keep showing revenue growth, albeit not as high as in previous years.

At the same time, despite the decline in income, the diet of Russians has become more balanced, as more and more people choose more healthy eating. And while sales of greenhouse vegetables fell temporarily during the period of the toughest restrictions in 2020, in 2021 the consumption level was restored to its previous figure.

Larisa Yerina says that vegetables rank among the products of prime necessity. That is why, when choosing between food and other purchases, people choose the former in favor of the latter. After a brief panic during the first weeks of the pandemic, people stopped massively buying up salt and buckwheat and went back to their usual ration. Moreover, during the epidemic, the need for fresh greenhouse vegetables even increased – people sought to boost their immunity naturally by consuming vitamin- and micronutrient-rich products. By doing so, the population showed concern for their health while trying to reduce anxiety levels, too.

Despite the rising trend towards healthy eating, the average Russian still consumes 24 per cent fewer vegetables than it’s recommended by the Ministry of Health. Nevertheless, Larisa Yerina is convinced that the consumption culture of our country’s residents is gradually changing, and as the production of organic and healthy vegetables increases, so will the demand for them.

The Sales Director of ECO-Culture holding explained how the company is mastering new sales channels. So far about 85 per cent of all the production output goes to traditional network retailers. However, a new direction of e-commerce is being actively developed now, too. The company already runs its own platforms for online trading. In addition, vegetables can be bought and delivered from all the online stores of the retail chains that the holding cooperates with.

ECO-Culture’s product range includes both premium varieties and mid-priced vegetables for every taste and wallet. The company tracks down the slightest changes in the market and instantly reacts to them. After all, supplies are always defined by customer interest – for example, the current popular varieties are round and plum-shaped medium-sized tomatoes. With the trends changing, the supply will inevitably do the same.

As for the production costs, the holding manages to keep them at the same level not by reducing the quality and weight of packages but by strictly controlling the expenses. Logistic costs, for example, can amount to both 10 and 30 per cent of the total sales volume, which means that optimization in this segment has a significant impact on profits. In addition, all purchases within the holding are being centralized, which leads to cost reduction as well.

For the full text of the article, please visit Agroinvestor magazine’s website.