The Apple Store in Krasnodar
Here’s a photo of the Krasnodar branch of a licensed Apple retailer called re:Store. The store is located inside of the Krasnaya Ploshad (translation: “Red Square”) Mall. When driving up to the mall, stay right, pass the McDonalds drive-through window on your left, and then park behind the mall. The store is just inside the entrance on your left, next to Maria Rafaela boutique. Click on this link to view a map and directions on the store website.
The staff (just like at most Apple stores) is young, knowledgeable, and friendly. The store has almost the same feel as Apple stores in the U.S. and as far as I could tell, it had almost the same selection of electronics. All of the hardware is compatible with the Russian electrical outlets and all of the keyboards have permanent Cyrillic characters on each key.
Click on the extended post to read more.
A business card from the Apple re:Store
By the way - Apple's brand is one of the hottest American brands in Russia right now. It has not yet hit the mainstream consciousness, but amongst the early adopters it is quickly gaining market share. I often see Apple hardware advertised in the glossy Russian magazines. It seems that if you want to convey cool sophistication in Russia, stick a MacBook laptop in front of a Russian model. I have to admit, it does warm my heart every time I see someone using an
Apple laptop in a cafe. Who would’ve thunk it 10 years ago?
Apple would be well advised to open a flagship store in Moscow, perhaps at the Crocus City Mall on the Ring Road near Sheremetyevo airport. re:Store is a national chain of Apple-licensed shops in Russia. The company currently has stores in nine Russian cities. re:Store is an example of the type of young retail chain popping-up throughout Russia these days. While there is certainly a lot of action in natural resources and public equity markets, there is also a big opportunity for Russian and international private equity funds to invest in these regional chains. The capital invested will help these regional chains grow much more quickly. Currently, most of these companies are growing organically through reinvested profits and local bank loans.
While the scale of these investments is not so large, the potential for growth is huge. I remember back in 1997, when Nordberg Capital visited Krasnodar to meet with Sergei Galitsky at Tander/Magnit which at the time was doing less than $100 million in annual revenues. They had an opportunity to invest but they wanted too much equity for the capital they were offering. Can you imagine their disappointment when in May of 2006, Tander/Magnit went public with a valuation of over $3 BILLION dollars?
My point is not to disparage Nordberg Capital, which has proven to be quite astute with its numerous investments in both the Russian and Nordic telecommunications markets. Who knew what the future held in 1997? My point is simply that the current crop of opportunities in Russia are not lacking for numbers, just in scale.
Obviously, most of these regional chains don’t have the kind of growth potential that Tander/Magnit did in 1997. However, based on a recent IPO of Rostiks Restaurants (the Russian KFC) at a valuation of over $300 million, I think private equity funds should not dismiss these regional opportunities. I will write more about a number of these regional chains in the weeks ahead. Stay tuned.
All photos by Timothy Post. © 2007 All rights reserved. Republished with permission.
Timothy Post, a native of Boston, Massachussets and an MBA graduate of Babson College, is a real estate developer in Krasnodar Krai. You can read the original post on Tim's blog, Inside Krasnodar. If you have more questions about doing business in Krasnodar, you can email him at email@timothypost.com.
Comments
Somebody told me that in Soviet times their computers were based on a 3-way --on/off/neither--system as opposed to the standard binary system here in the West; and that for this reason the Soviet computers were better at handling very sophisticated calculations in mathematics and physics.
True?
Posted by: armchair pessimist | August 23, 2007 6:37 AM