Regional Report by Petr Kramerius/Boris KuSCHEV, Regional Manager, Infosource
When the pandemic broke out, Russia was in pretty good shape: low inflation, low unemployment, stable banking sector and huge reserves. Thanks to sanctions back in 2014, Russia currently have a much smaller reliance on external capital flows. Therefore the shocks from the pandemic have hurt the economy less and Russia service and small-business sectors, hit especially hard by the lockdowns amid the virus, are relatively small compared to those in many other countries.
The Russian economy contracted by an estimated 3.1% in 2020 when lockdown measures have been less far reaching than in many countries, and a sizeable fiscal stimulus and positive contribution from net trade. Russia relatively small service sector helped cushion the impact of a sharp fall in domestic demand and drag from oil production cuts under the OPEC.
In Autumn 2020, as the second wave of the coronavirus pandemic pummelled Russia over recent months, the Kremlin stopped short of bringing back a nationwide lockdown in an effort to save the economy. If the Russian government would declare a lockdown, the next step should be a provision of economic and financial support for businesses and citizens, but there are not financial funds for such economic assistance. Therefore rather than shutter the economy with another quarantine, the Kremlin has banked on large hospitals in Moscow — the country most populated city and the epicentre of its outbreak — to help get Russia through the pandemic.
In the second quarter of the year 2020, the number of Russians living below the poverty line increased by 1.3 million compared to the first quarter, according to federal statistics agency Rosstat, by the end of the year, nearly 20 million people were living in poverty, Labor and Social Protection Minister Andrei Kotyakov has said. Although such a figure is better than in most European countries — where lockdowns have been instituted during the second wave — the ruble has also given up a third of its value since January.
However, in terms of printing markets and industries, the results for full year 2020 can be definitively viewed positively compared to the same period of last year. These results come as a bit of a surprise as usually, the printing market experiences a downfall during crisis times. The reasons for such development can be that in Russia, the digitalization process is yet not so developed, and a lot of communication is mandatory in written form, which is understood to be the most reliable. Also, because of economic problems the buying trends within the printing industry favour BW and slow speed devices.
The total toner-based Copier/MFP Russian market increased by 8%, when the personal Copier/MFP category registered a higher increase of 12% to 954k units, and BW personal Copier/MFPs market recorded an increase of 13%, representing a commanding 95% share of the total personal category. The personal color market stayed almost flat, declining by just 1%.
On the other hand, the Total office market sales were down by 5% and represented a 21% share of the total Copier/MFP market. The BW office Copier/MFP represented an 84% share of the total office market, and its sales also decreased by 5%, while the color office market declined by 8% to the level of 40k units.
Within the personal category, HP held a total of seven models within the top ten with number one bestseller LaserJet MFP 135w. Surprisingly Pantum model M6500 went to the fourth position. In the office category, Kyocera models occupied eight positions in the top ten, with number one bestseller ECOSYS M2235 DN. Again Pantum went surprisingly in the office category to the 7th position with its model M7100DN, for the first time, breaking into the top ten models.
The total toner-based single function page printer market (proportionally 54% of the total toner-based Copier/MFP market) registered a double digit increase of 13%, stressing the popularity of simpler devices during economic hard times. The BW SFP market increased by 17% and represented a 96% share of the total SFP sales, while the color SFP category registered a decrease of 34%. Within the SFP market, HP took four spots in the top five, with number one bestseller model Laser 107a Printer, followed by Laser 107w Printer.
The total inkjet market (proportionally about 64% of the size of the toner-based Copier/MFP market) declined by 3%, the decline based on a decrease of the consumer/home market (representing 89% of total inkjet sales) by 6%, while the business market was up by full 42%. The very popular category of ink tank/CISS devices stayed flat at 402k units, still representing a full 52% of the total inkjet market. Within the inkjet business market „owned“ by Epson with a market share of 80%, the sales of inkjet CISS devices (manufactured solely by Epson) soared by 354% from about 14k units to 62k units (in FY 2019/FY 2018 sales were up by 213% from 4k units to 14k units).
Within the inkjet market personal segment, Canon placed six models within the first ten positions in terms of bestseller models, with number one bestseller Pixma MG 2540S (82k units sold), followed by HP DeskJet 2320 AiO. In the business category, Epson placed eight models within the first top ten positions, number one was EcoTank ET-M2110 (17k units), followed by EcoTank ET-M1120 (11k units) and EcoTank ET-M1100 (8k units) – all these being CISS models.
The total Large format printer in Russia dropped by 14% in FY 2020. The water-based ink type category decreased by 16% to the level of approx. 8.5k units (representing 88% of the total LFP market), while the solvent category registered an increase of just 7%, the UV-LED cure category decreased by 18%, the latex category decreased by 11%, and the dye-sublimation category increased by 32%. The Direct to Garment industry fell by 23% few units (in FY 2018/FY 2017 there was an increase of 15%) with market leaders Brother, Ricoh and Epson all with a similar amount of installations.
Regarding document scanners, this market has decreased by 5% in FY 2020, former No.1 Canon registered a decrease of 63% and the top spot was taken surprisingly by Avision. However, Canon decrease rate in FY 2020 has to be taken in connection with previous years, when by late 2018 Canon won a large tender for 13.500 devices, which were all shipped in early 2019. Therefore the decrease to normal Canon level is a consequence of Canon rise in 2019. Therefore, in FY 2020 Avision leapt from 7th to 1st position with a sales increase of 457%, from approx. 2k units to 13k units. Avision won the largest Scanner tender in Russia in 2020 for supplying document scanners to the Pension fund of the Russian Federation. In October and November 2020, the Head Office and individual branches of the Russian Federation Pension Fund held sixteen tenders with scanners, when four tenders were very large.
As for future development, as it was already mentioned, according to some economists, the Russian economy has been less badly hit overall by the virus than some countries because of its smaller service sector. President Vladimir Putin said that Russia economic activity is “gradually” recovering however, this opinion can be regarded as a purely diplomatic statement, as employment levels are set to remain significantly below their pre-crisis levels well past 2021, providing another potential drag on hopes for a consumption-led recovery. The World Bank expects Russia economy to start recovering in 2021, at a pace that may depend on the impact of a COVID-19 vaccine but has said “the worst may still lie ahead” for Russian banks.
Six in ten Russians told statistic research that opportunities to earn a decent wage had got much worse over the last 12 months, while more than 40% said they were scared about growth in unemployment and a new economic crisis. Fearful of the impact rising food prices were having on Russian households, in December the Russian government introduced price controls on butter and sugar — a policy it also reverted to during the 2015 economic crisis.
The economic situation in Russia has “turned out to be better than expected,” according to the country Central bank. The Central bank governor Elvira Nabiullina said at the first board meeting this year that “the economy is bouncing back rather steadily” and that “given the current positive trends” the bank has maintained its outlook on GDP growth for 2021 at three-to-four percent.
Overall, according to the facts, Russia economy handled the coronavirus better than many others in 2021. But austerity, bruised businesses and cautious consumers set the stage for a slow recovery. Looking ahead, the economy is expected to gradually recover in the coming quarters as the vaccination program gathers momentum and pandemic-related restrictions are gradually removed. The pace of vaccinations could be one of the most critical drivers for the resumption of economic activity and the government efforts to facilitate economic recovery.
Petr Kramerius, Regional Manager
Phone : +420 607 887 117
e-mail : firstname.lastname@example.org
Boris Kuschev, Regional Manager
Phone : +7 (916) 111-9163
e-mail : email@example.com