From Russia with Love

 
It was 1963 when James Bond, alias Sean Connery, greeted the world from Moscow ... a time when it was almost impossible to find a restaur ant worthy of the name in the Russian capital. Today, there are over 4,000 restaurants in Moscow – an extremely young and explosively expanding market that, according to local sources, is currently worth US $2.5-3 bn. And hardly anywhere else in Europe is the scene so dominated by chains as there. A market overview from a western perspective.
 

 
30 January 1990: a historic date. 30,000 Muscovites form a queue around Pushkin Square. What are they waiting for? They want to grab the symbol of America – and the epitome of freedom – a Big Mac! McDonald’s Canada opened the very first store in Russia, the beginning of a great story of expansion. And of a new era of Russian foodservice, which is now one of the world’s most dynamic markets. In the pre-McDonald’s age, foodservice facilities for tourists and business people, as well as for the local ‘nomenklatura’, in Moscow – and thus in the country as a whole – were limited to a few hotel restaurants. The growth in the number of establishments meeting the western definition of a restaurant to over 4,000 can only be described as explosive. Nevertheless, in a metropolis of 12 m people (unofficially, the figure is significantly higher), this represents only one restaur - ant per 3,000 inhabitants – significantly fewer than in West Europe, e.g., with almost 9,600 foodservice outlets (total for the hospitality sector: 10,170), Berlin can boast one restaurant per 350 of its 3.4 m citizens. Chain restaurants, the bulk of them with Russian roots, dominate Moscow.
 

 
With around 1,500 outlets, they hold the lion’s share of the market (over 40%) – and are growing at the rate of 25% per year. It was only twelve years ago that the very first European-style coffee bar was opened in Moscow. Today, the country’s two leading systems, Coffee House and Shokoladnica – both of which are expanding at a breakneck pace – have around 120 and 160 outlets respectively in the capital alone. Chains and brash newcomers are to be found in all segments of the market, from coffee bars and snack bars, such as Stardog’s and Kroshka-Kartoshka, to fine-dining restaurants (the foremost operator names in this segment: multi-concept players such as Arkadiy Novikov and Andrej Dellos). It is no accident that highlydecorated star chef Alain Ducasse recently mentioned Moscow in the same breath as London and New York when discussing the number and quality of the city’s finedining places ...
The ten biggest foodservice chains account for over 50% of all chain outlets: a structure similar to that in the USA. And virtually unknown in Europe, except in London. A glance back in time provides the explanation. For decades during the Soviet era, private initiatives of any kind were suppressed ruthlessly. Today, there is absolutely no tradition of individual enterprise, especially the family operations that characterise the foodservice landscape in West Europe. On the other hand, the Russians have learnt to think in terms of large-scale structures – if you like, a fruitful legacy of communism
 

 
| 22 October 2008 |