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- Keep it to yourself: chains will be obligated to include at least 10% of regional products in the assortment
Keep it to yourself: chains will be obligated to include at least 10% of regional products in the assortment
Retail chains will be required to put regional products on the shelves. Their share should be at least 10%. Such a bill will be submitted to the State Duma on April 11, Izvestia learned. The innovation will increase the availability of local products and reduce transportation costs, the deputies believe. Now the networks are mostly large manufacturers, with whom it is more profitable to cooperate. Whether this measure will support local entrepreneurs is in the Izvestia article.
Why is it difficult for local manufacturers to get into retail chains
Retail chains want to oblige to put at least 10% of essential goods of regional production on the shelves. As Izvestia found out, such amendments to the law "On the Basics of State Regulation of Trade activities in the Russian Federation" will be submitted to the State Duma on April 11 by deputies of the Fair Russia — For Truth faction led by Sergey Mironov.
The document reviewed by Izvestia says that the new regulations are aimed at supporting regional producers and reducing dependence on supplies from other territories.
"The introduction of the requirement will increase the availability of locally produced products, reduce logistical costs and stabilize consumer prices," the explanatory note to the bill says.
The document notes that today essential goods include meat products (beef, pork and lamb, with the exception of boneless meat, as well as chickens, except chicken legs), fish (frozen, undivided), dairy and fat-and-oil products (drinking milk, butter, sunflower oil). In addition, this category includes chicken eggs, granulated sugar, salt, tea, bakery and pasta products, cereals (ground rice, millet, buckwheat), as well as the main types of vegetables and fruits (potatoes, cabbage, onions, carrots, apples).
Today, one of the key problems of the Russian food market is the high degree of centralization of product purchases by federal retail chains. This leads to complex and lengthy logistics chains that increase the cost of goods. The duration of transportation, storage in distribution warehouses, and redistribution between regions often become the main factors driving up food prices, the authors of the bill specify. In addition, such a supply chain also reduces the competitiveness of local producers who cannot enter the shelves of federal retail chains.
Therefore, the introduction of a norm on the minimum share of regional products will create additional opportunities for small and medium-sized producers, reduce the monopolization of distribution by large suppliers and provide consumers with more affordable goods, the document emphasizes.
At the same time, as its authors note, the bill is not universal. Local authorities will be able to establish exceptions to the minimum share requirement in case of insufficient production of specific products in the region or if there are other factors that make it impossible to comply with this norm. Such a flexible approach will avoid the risk of a shortage of a particular product.
As Sergey Mironov explained to Izvestia, today in Russia there is an increase in retail prices for essential goods. In particular, according to Rosstat data on April 7, potatoes have risen in price by 34.45% since the beginning of this year, and cabbage by 19%.
"The bill is aimed at reducing retail prices, increasing the availability of locally produced goods, and supporting regional producers who perform an important social function in the regions — they create jobs," the deputy explained to Izvestia.
Izvestia sent requests to the Ministry of Industry and Trade and the Ministry of Economic Development with a request to clarify whether they had received a draft law for review and whether it could be supported. The Association of Retail Companies declined to comment, and the editorial board also sent questions to major retail chains asking them to evaluate the initiative.
What determines the prices of products in retail chains?
Other factions of the State Duma said that the initiative deserves attention, but the issue of the share on the shelf should still be discussed.
— It is worth recalling that a number of retail chains operating in Russia today are owned by foreigners, who are naturally interested in supplying friendly manufacturers. It is no coincidence that Russian farmers who cannot get on federal shelves have been complaining about the situation for a long time," Nikolai Arefyev, first deputy chairman of the State Duma Committee on Economic Policy from the Communist Party faction, told Izvestia.
However, what percentage of this shelf should be — 10 or 30 — still needs to be discussed. After all, some products may not be produced in the regions, he noted. Therefore, the initiative needs to be worked out so that it can be implemented, the deputy added.
— We believe that federal legislation should include a rule on a certain proportion of regional products that should be presented on shelves in federal chains. This is necessary to support local producers. Currently, such measures are being introduced in some regions, but they are not mandatory, so the issue requires federal regulation," Sergei Lenov, deputy chairman of the LDPR faction, explained to Izvestia.
He also recalled that in 2024, the party submitted a bill to the State Duma with a proposal that the share of such goods should be 25%, but the initiative was rejected.
Representatives of regional businesses told Izvestia why they couldn't get into federal networks.
— Retail chains want to put products on the shelves that will be sold and not take up space. Therefore, they put forward different conditions, usually hidden, because it is prohibited by law," Irina Eldarkhanova, vice president of the Russian Guild of Bakers and Confectioners, explained to Izvestia.
According to her, for example, they can set conditions that if the turnover is less than a certain figure, the manufacturer must compensate for their lost profitability. She also noted that the mark-up on goods, which is set by retail chains to the supplier's price, can be huge and reach up to 100%.
Federal retail chains are asking to reduce the cost of products and pack them in a different way, Alexander Pocheptsov, a farmer from the Moscow Region, told Izvestia.
— But this is not always convenient for us, because farmers cannot sell cheaper than they produce. Natural cultivation (of plant products or the production of eggs and meat) by hand is always more expensive," he explained to Izvestia.
At the same time, he noted that even if the manufacturer gives the goods on the terms of the networks, their margin on it will still be high. Another factor that does not suit agricultural producers is the payment they receive only a few months after delivery.
Marketer Andrey Arno agrees with the opinion that retail chains are asking manufacturers to reduce the cost of products in order to increase their profits.
— This is exactly how profits are formed, because the task of the networks is to reduce costs and increase their margins. Therefore, the cheaper the retail chain buys these products from the farmer, the higher the percentage of profit it can guarantee itself. If in some way a farmer cannot do this, then pressure is put on him to ensure that the initial purchase price is as low as possible," the expert explained.
According to him, one of the instruments of pressure is forcing to change the packaging so that its usual size is smaller and the purchase price is reduced. The buyer sees the traditional volume, it seems to him that there will be, say, a kilogram, but in fact there are 900 grams or even 850, but he cannot separate the weight and packaging in his head, so he pays the usual money, Andrei Arno explained.
Andrey Sobkalov, an Adyghe farmer who produces chicken eggs, told Izvestia that it would be interesting to get into retail chains if farmers could exhibit products there at their own price, rather than undervalued. From this point of view, according to him, the initiative deserves support. At the same time, he noted that he had experience communicating with one of the largest networks, where he was offered to sell premium chicken eggs for 70 rubles per dozen, despite the fact that their cost alone was 240 rubles. Therefore, he refused such cooperation.
Elena Annenkova and Kristina Sokolovskaya participated in the preparation of the material.
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