The Moydodyr chain will not create electronics hypermarkets, but will concentrate on the niche of built-in appliances, says Vodovatov. By the end of the year, the chain intends to increase the share of built-in appliances in the assortment to 50%, the rest of the sales areas will be occupied by white household appliances (refrigerators, washing machines, kitchen stoves, etc.). In 2007, it is planned to increase turnover to 750-780 million rubles, and profit to 1.3-1.8 million rubles.

In addition, Moydodyr is concerned about bringing the chain to a single format. Over the past year, the company closed four stores with an area of 100-150 sq. m and spent about $1 million to open two new outlets of 400-500 sq. m each. By the end of the year, it plans to open another store of this format.

“As consumers’ incomes grow, their interest is increasingly shifting from stand-alone appliances to built-in solutions,” explains Vodovatov. He expects this niche, which is still presented as an additional option in electronics stores, to grow. In 2005, this segment increased by 37%, in 2005 – by 30%, and similar rates will continue this year, he claims. Overall, the home appliance market grew by 25% in 2005, by 17-18% in 2006, and the forecast for this year is 14%. According to Vodovatov’s estimate, built-in appliances are owned by 5-6% of Russians.

The transition to narrow specialization is a logical decision for a chain of small stores, says Alexey Kramarev, CEO of the consulting company “Trading Solutions”.

There are already examples of niche networks on the market: “White Wind” specializes in digital electronics, “Albatross” in washing machines.

“There is always a certain risk in choosing a narrow niche, which large chains compensate for with a wide range of products,” says Kramarev. However, it is the Hi-Fi and built-in appliances segments that are currently in the greatest demand, the consultant adds.

“Buyers’ demands for comfort are growing, and the built-in appliance segment is promising,” agrees Olga Serzhant, head of the retail sales department at Delta (which manages the Vstroy-Ka chain). In 1994, Delta opened its first store in Moscow, which specialized in built-in appliances. Now the chain has 18 stores, three of which are in St. Petersburg. Since 2003, the chain has also been selling kitchen furniture. According to Olga Serzhant, expanding the range has increased profitability to 50%. She believes that selling only built-in appliances is difficult.

Vodovatov says that Moydodyr does not plan to sell kitchen furniture in its own stores. However, he does not rule out that he will supply equipment to furniture stores, as in Moscow.

"Moidodyr" from the niche