An importer is building a distribution network in major cities

As Kommersant has learned, one of the largest wine importers, the Svarog company, is going to open 30 wine boutiques in cities with a population of over a million. Investments in opening one boutique will amount to $25-115 thousand, and the entire project will be implemented within 10 years. Market participants consider the promotion of expensive wine in the regions to be a logical step - sales volumes in this segment are growing by 25-30% per year.
Wine boutiques will open in cities with a population of over a million under a franchising scheme. “The main buyers of the franchise will be wholesalers who are ready to diversify their business. We are now developing the terms of the future franchise. Most likely, wine boutiques will be small points (area about 100 sq. m) and sell wine in the middle price segment and above - in their the assortment will include about 2 thousand items,” said Alexander Slugin, general director of Svarog CJSC. According to him, investments in opening one boutique will be $25-115 thousand, depending on the company’s existing business. Svarog plans to spend about 10 years creating its network.
JSC "Svarog" was founded in 1992. The company's distribution network covers 7 regions: North-West, Center, Volga region, South, Ural, Siberia (western and eastern), Far East. The company's brand portfolio includes: 75 brands from 25 countries. The company owns four Svarog wine boutiques in St. Petersburg. The owners of the company are individuals.
Market participants were not surprised by Svarog's plans. Sales of wine are currently growing more rapidly than sales of other alcoholic beverages. The Business Analytics company estimates the capacity of the wine market at $2.7 billion per year, and its participants themselves at $3.5 billion per year. At the same time, wines costing more than $50 per bottle account for about 20% of the market. “Every year, sales of expensive wine are growing by 25-30 percent, and this market dynamics will continue in the next 3-4 years,” say the marketing department of the Svarog company.
Another large distributor of expensive wine, the Bon Vin company, is also hatching plans to enter the regions, whose wine boutiques currently operate only in St. Petersburg and Moscow. Representatives of Bon Vin consider the Volga region, the Urals and the Far East to be the most promising regions. “The turnover of our stores has grown over the past two years by an average of 30-40 percent, and in the next three years the growth rate will be 15-25 percent annually. Our network also has plans to open stores in other regions, as we note significant growth demand for expensive and high-quality wine is not only in the capitals,” says Anton Shcherbak, manager of the Bon Vin chain of wine boutiques.
Currently, only about 2% of the wine sold in Russia is sold through wine boutiques, but in the next 2 years, according to analysts, the volume of such sales will increase to 5%. Market participants are confident that wine boutiques, like gourmet food stores, will develop as opposed to regular grocery retail. “Regular retail sells mainly 'democratic' wines, the price of which is below $50. Large retailers are interested in mass products, which, due to the large volume of sales, bring good profits. Therefore, small wine boutiques specializing in expensive varieties have their own niche and good prospects for development,” says Svetlana Trukhanovich, a financial analyst at AVK Analytics.
MARIA SHEVCHENKO

Newspaper "Kommersant St. Petersburg" No. 20/P dated 02/06/2006, p. 1

"Svarog" will pour wine into boutiques