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22 Jul, 2008 03:38

Sony goes direct to Russian customers

One of the largest Japanese electronics producers, Sony, is changing its distribution model in Russia to direct sales. The company says the Russian market is now big enough to display the company's whole product range.

Sony expects Russia's notebook market to grow by 50% this year. The company hopes to get a larger piece of the pie, working directly with retailers and cutting out middle men.

Sony says those distributors buy only the fastest-selling products, and dont carry many parts or accessories. Now, the company says, Russian customers will get access to the wider product range. Tom Hamaguchi, Marketing Director of Sony Electronics, says the new approach will open up new opportunities.

Based on this new platform we can enhance our shop front activities and through those activities we can show, we can demonstrate our unique products, such as colour variation products and the digital home concept and its accessories.

Experts say in a year and a half the main IT producers will switch to selling directly in Russia, and in roubles. But it's not yet clear what impact the move will have on pricing, with Aleksey Krivoshapko, Director at Prosperity Capital Management seeing different effects on different market retailers.

It will not impact the prices on the shelves in the consumer electronics stores, such as MVideo, Eldorado, Technosila, and Svyaznoi, because those products were brought here 100% legally.  At the same time this will create pressure for those who were previously smuggling, because they just have to raise prices, because now they will be buying from Sony here in Russia locally.  Because there’s no way Sony will be selling them products from Helsinki anymore

Analysts say that direct distribution may also eliminate grey market goods which usually undercut official imports.