This year, TD Narodny will develop a project outside the Nizhny Novgorod Region for the first time. In the capital of Chuvashia, Cheboksary, the holding is starting construction of a 10,000 sq. m shopping center, the owner of the holding, Vasily Pushkin, told Vedomosti. The supermarket will occupy up to 1,500 sq. m, the remaining space will be occupied by stores selling related products. According to Pushkin, investments in the project will amount to about 200 million rubles of borrowed funds. The Cheboksary mayor's office declined to comment by phone. And the director of the management company For-Capital (a subsidiary of TD Narodny) Sergey Trubin said that the holding acquired one of the Cheboksary firms, which had previously been allocated 1.5 hectares of land. The general contractor for the construction of the shopping center will be the Cheboksary construction holding Starko, Trubin said. The general director of Starko Andrei Aleksandrov confirmed to Vedomosti that his company will be the general contractor for the construction of the shopping center.

Pushkin says that if the project in Chuvashia is successfully implemented, the company will build similar shopping centers in the neighboring republics of the Volga region – Mari El and Mordovia. “There is no competition in these regions yet, so the holding plans to gain a foothold in the market even before the arrival of Moscow companies,” says the owner of Narodny.

The holding does not intend to give up its positions in Nizhny either. Until now, Narodny developed most of its supermarkets and stores in the Avtozavodsky district of the city. According to Pushkin, five supermarkets will be opened in other districts this year, and another six in 2007, each with an area of 1,000 square meters. Investments in opening one supermarket, in his opinion, will amount to 4-8 million rubles.

Market participants call the Cheboksary market promising. According to the CEO of the company "Myasnov" Vladlen Altshuller, the experience of local (district) opening of the TD "Narodny" chain is good and applicable to the Cheboksary market. In terms of the number of residents (in the Avtozavodsky district there are more than 300,000, and in Cheboksary about 500,000), the markets are comparable. The only problem that the TD may face, says Altshuller, is finding qualified personnel. The head of the marketing department of the Cheboksary company "SMAK" Andrey Pantyukhin found it difficult to assess the prospects of the Nizhny Novgorod company, but added that the expansion of out-of-town companies began only a year ago, so for now there are enough clients for everyone.

Pushkin is not the first of the Nizhny Novgorod retailers to announce plans to enter other regions. In 2005, Nizhny Novgorod entrepreneur Andrey Klimentyev and the Zhanto group announced plans to build shopping centers in cities in Russia and Ukraine. According to the owner of the Zhanto holding, Evgeny Toptygin, the company has had problems with the mayors of Voronezh, Ulyanovsk, and in Ukraine - in Nikolaev and Odessa, regarding the allocation of land. According to him, Zhanto continues to search for land in other regions. The possibility of entering Cheboksary, Rostov-on-Don and Tolyatti is also being considered by the Elektronika Group, said the group's general director, Alexander Kuznetsov.

Director of the Ready-Made Business Store Yuri Kuzmichev explains the interest of Nizhny Novgorod entrepreneurs in other regions by the saturation of the Nizhny Novgorod market and the intense competition among companies. Over the past two years, the Metro shopping center, Perekrestok, Kopeyka, and Magnit supermarkets have opened in Nizhny Novgorod, and the retail turnover in Nizhny in 2005 increased by 10.1% compared to 2004 – to 96.7 billion rubles. Head of the consulting center of the Union of Stores of the Nizhny Novgorod Region Vadim Nosov notes that a situation has developed on the Nizhny Novgorod food market in which none of the operators has a dominant position. “There are currently 15 operators working on the market, but in reality the market needs no more than five large ones. Therefore, in the coming years, a certain redistribution of the market will take place – someone will merge, and someone will sell their business,” Nosov emphasizes.

"Narodny" goes to Chuvashia