Russian Spending on the Rise
May 27, 2014 - 7:54am
With increasing attendance and buying at international shows, Russia is becoming a segment to watch for.
Demand for furniture in Russia rose more than 500 percent between 2001 and 2012. Source: Rooms Moscow/MIFS

After traveling to several international shows over the last two years, the Residential Lighting team noticed, as did others in attendance, that the Russian buying market has been making a splash.  

Statistics corroborate this anecdotal evidence. At the 2013 edition of i Saloni in Milan, which comprises the lighting show Euroluce as well as Salone del Mobile, SaloneUfficio and International Furnishing Accessories Exhibition, 24,242 Russian visitors were in attendance, up a whopping 35 percent from the 2011 show.

Russia’s stake in the total share of visitors at that show also increased over the last several years— Russians made up about 6 percent of total visitors in 2011 but about 8.5 percent in 2013.

And although final statistics from this April’s Light + Building show are not yet available, Messe Frankfurt says there was a significant increase in attendance from Russia as an expanding market.

The Russian consumer market is indeed growing. According to EY, by 2015, 82 percent of all households in Russia will be part of the middle class (that number is closer to 50 percent in the U.S.), and the average household net-adjusted disposable income per capita is $17,230 USD a year and is continuing to increase (compared with $39,531 USD a year in the United States).

Russia imports have also been on an upward slope since 2009. In fact, according to Rooms Moscow/MIFS, more than half of the country’s furniture needs are covered by imports.

One company with a U.S. tie, UK-based Elstead Lighting, which imports brands such as Quoizel, Feiss, Stiffel, Hinkley and Flambeau for the European market, has noticed Russia’s increasing influence as well. Managing Director Jonathan Lucas says it’s been happening since the mid-2000s.

“As far as we understand, they’re buying everything, including modern and technical,” Lucas says. “Although now, market legislators and customs are closing in on non-Russian standards-compliant products, making it harder for importers to buy on a more ad-hoc basis.”

This standard, called Certification GOST-R, is different and mostly not harmonized with European or international standards. Almost all consumer products, including lighting, require this certification, and the requirements have gotten stricter over the last several years.

This is something to take into account as we continue to monitor Russian buying tendencies going forward.

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