Russians are sharply reducing consumption of luxury goods: according to forecasts by Bain & Co, the market for expensive goods this year will fall by 18% to 4,6 billion euros - more than during the crisis of 2008-2009, when the fall was only 5%.
Bain & Company cites the devaluation of the ruble, the Crimean crisis, which caused the deterioration of the economy, combined with a decrease in consumer confidence, as the reasons for such a sharp and strong decline in sales in the Russian luxury segment in 2014. Disappointment with the Sochi Olympic Games is also cited as one of the reasons.
Wholesale customers have reduced access to credit resources, and a drop in sales leads to a lack of liquidity, which, in turn, worsens their prospects for fulfilling obligations to counterparties. Bain & Company expects Russian luxury wholesalers to cut their spring / summer 2015 budgets by up to 30% due to falling sales and continuing ruble devaluation. The overall low level of consumer confidence is due to uncertainty about the future.