62710 LONG-TERM PARTNERSHIPS WITH EMERGING PLAYERS Start Small, Grow Big: Rubliovskiy Retail Chain IFC’s long-term financing is helping Rubliovskiy build a growing network of grocery stores and distribution centers in Belarus, where consumer demand is growing, but where there is limited international finance availability for retail projects and an underdeveloped retail sector. The addition of more supermarkets and a sophisticated logistics network to supply them will give consumers more options, increasing access to affordable, high-quality food and introducing the modern, convenient, one-stop-shopping model to the Belarus market. Such efforts support economic expansion in middle-income countries, creating jobs and building infrastructure while helping the company improve efficiencies, deepen its local supply chains, and keep prices competitive for consumers across the income spectrum. • Early 1990s: Company sets up shop as a wholesaler and distributor, ultimately becoming the nationwide distributor for leading interna- tional brands including Bonduelle, Danone, Frito Lay, Nestle, Pepsi Cola, Unilever, and Wrigley. Its modern warehousing and distribution opera- tions introduce a new, safer and more efficient approach to grocery supply chain management in a market dominated by small, indepen- dent shops and bazaars • 2003: Company opens its first grocery store in Minsk, under the name Rubliovskiy, setting a new course for grocery retailing in the country with its one-stop shop in the easy-to-access center of the city. • 2004: Building on the strong financial performance of the first store, the company opens eight additional stores. • 2007: Rubliovskiy becomes a major force in grocery retailing in the country, with 20 supermarkets and convenience stores in Minsk, all located in easily-accessible areas. • Today:. Company focus on locally-sourced goods has broadened opportunities for local agricultural producers and suppliers. Rubliovskiy’s successes are clear: the company holds 70 percent of the distribution market share of the imported grocery in the coun- try and its grocery stores serve an estimated 65,000 customers each day. Currently, Rubliovskiy’s network of grocery stores consists of 25 supermarkets in Minsk. • Going forward: The $110 million expansion includes: • 20 new Rubliovskiy supermarkets in Belarus’ six major cities • 6 new distribution centers in Belarus • increased efficiency of the present logistics business • estimated completion of all phases by 2012 • $26 million in long-term financing (combination of quasi-equity and debt) • Guidance and technical advice on diversification and upgrading operations to meet international standards • Support for improvements in environmental and social policies, including labor practices • Assistance on the design of a comprehensive and cost-effective insurance program that provides robust protection for their changing business model LONG-TERM PARTNERSHIPS WITH EMERGING PLAYERS • Increased middle- and low-income consumer access to high-quality, affordable food with accessible, city-center locations • 1,600 direct jobs, and other indirect jobs for construction workers, suppliers and distributors • Expanded local suppliers network and complementary economic development • Enhanced food safety • Introduction of modern food retailing standards into the market Modern grocery retailers like Rubliovskiy can help keep food costs down, expand access to high quality food and contribute more broadly to economic development in middle-income countries and in very poor countries. IFC’s grocery retail investments focus on the full scope of the food value chain: from guidance on ways to increase agricultural productivity and quality to investment in modern retail operations that offer economies of scale with associated price reductions; from food processing and packaging to logistics and warehousing. • In Ukraine, Evrotek is building a chain of modern grocery stores, called “Fresh,” supported by IFC financing and guidance on strengthening relationships with small local suppliers and agribusinesses. • In Sub-Saharan Africa, IFC’s $7 million investment will enable Marina Market to open stores in Niger, Burkina Faso and Ghana. • In Azerbaijan, IFC is helping to build a grocery store chain under the brand name ALMALI, to provide a reliable source of quality, affordable goods for middle and lower-middle income consumers. • In Guatemala and El Salvador, IFC provided financing for local grocer La Fragua, for an expansion into rural, isolated areas where people—mostly women—had to travel long distances to find food. The expansion increased availability of stably-priced, safely- packaged food to rural areas and created close to 2,000 jobs with good benefits and higher than average wages, primarily for women. Our current Retail portfolio of over $1 billion represents investments in 35 companies and 27 countries. IFC’s sectoral expertise, regional knowledge and leadership in sustainability offer significant value to our clients, in addition to our full suite of financial products and services. For more information about IFC’s financial products and advisory services in the retail sector, please contact: Olaf Schmidt 52-55-3098-0233 or oschmidt@ifc.org Brendan Dack 1-202-458-9757 or bdack@ifc.org Printed on material that meets internatiional environmental standards and is from sustainably managed commercial forests ifc.org 2009