Step 4 of the series: “When the going gets tough….., the tough apply a winning 8-step approach to the Russian and CIS markets”

1. Make sure your product or service is competitive

2. Know the market

3. Be hungry for the business

4. BE READY TO GO LOCAL

5. Have a clear strategy

6. Dedicate enough resources

7. Put together the right team

8. Take control

Step 4. Are we ready to go local?

The nineties were sweet from a sales perspective. Russians would come with their own trucks and suitcases with cash to Europe to buy whatever they needed right from European factories on an ex-works basis. Today the opposite is true. Russians prefer to buy from a Russian legal entity, in Russia, in roubles on a DDP basis. Instead of buying full container loads they prefer to buy pallets, boxes or pieces depending on the actual demand. Moreover, as e-commerce develops often the biggest sales channels are the ones that don’t hold any stock themselves. This means you will have to hold your products on stock in Russia (Russia has 100 million internet users and over 50 million people who regularly buy something on the internet).

Since 2014 the Russian government increased its localisation and import substitution drive. As a result, there is a general tendency to “buy Russian” and to decrease dependency of imports. Russia will continue to need foreign technology, expertise and products but it is advisable to show willingness to become a “corporate citizen” in Russia and to show some steps taken towards localisation. Step one is having your documents and website in Russian and having the right certificates. Step two is having a Russian representative in Russia. Step three is being able to sell on a DDP basis. Step four is having your own legal entity.

(If you want to know more about what it means to localise step by step and how you can localise without large up-front investments then you can contact us at [email protected] for further information)