Business news from Ukraine


Retail turnover in Ukraine in 2020 increased by 12.7% compared to 2019, which is associated with significant growth in the e-commerce segment and high domestic demand, the press service of CBRE Ukraine said.
The 2020 retail real estate market survey reports that in 2020 Ukraine recorded impressive annual sales growth rates in the e-commerce segment. According to Euromonitor International, the e-commerce segment achieved 8% of annual retail turnover, up 45% from 2019.
“Thanks to this significant growth in e-commerce, more and more retailretailers are focusing on the development of omnichannel commerce to compete with online platforms,” Radomyr Tsurkan, Managing Partner of CBRE Ukraine, said
A significant number of international brands such as Colin’s, IKEA, Miniso, Massimo Dutti, Uterqüe, Stradivarius and Pull & Bear launched online stores during 2020. Groceryretailer ATB launched its first online store during the lockdown and introduced a new click & collect service, which allows you to pick up groceries from the store after an online purchase.
The expert also noted the oncoming transfer from online to offline: some e-commerce websites (Rozetka, Makeup) actively opened click-and-mortar stores to complement the online experience for customers who want to check the goods live before buying.
“E-commerce will continue to expand towards multichannel retail, driven by a sharp increase in consumer dependence on online shopping during 2020. Rapid improvements in delivery services are also driving the expansion of online stores,” he commented.
According to the expert, with increasing competition, more and more e-commerce players will open and expand stores or points of delivery in order to improve or complement the online customer experience with a physical or offline experience. More traditionalretailers are also expected to focus on developing online platforms to keep up with consumer habits.
CBRE is the world’s largest commercial real estate consultancy and investment firm, with 2020 revenues of $ 23.8 billion. The company is one of the 500 largest companies in the world according to the Fortune 500 ranking (128th in 2020).

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The volume of Ukrainian e-commerce exports in 2020 increased by 30% and amounted to $450 million, while the majority of Ukrainian e-commerce platforms are designed exclusively for the local consumer, according to a study of the Ukrainian e-commerce market conducted by Soul Partners, Baker Tilly Ukraine and Aequo at supported by USAID.

“Prospects for the development of the export potential of e-commerce remain at a relatively low level. According to the results of the survey, over 85% of respondents declared the absence of export operations using e-commerce, while the majority of the interviewed entrepreneurs are extremely interested in the development of e-exports,” Partner and Advisory Practice Leader at Baker Tilly Ukraine Andriy Kaliushenko said.

According to the study, Ukrainian electronic exports are mainly represented through international platforms such as Amazon, Ebay and Etsy, while most Ukrainian platforms do not provide the possibility of export operations or international delivery.

The largest importer of Ukrainian goods at the end of the year was the United States, which share was 33% of the total Ukrainian e-commerce export. In second place is Russia (16%), followed by the U.K., Germany and Canada (4-7%). At the same time, a third of export operations in Ukraine falls on Kyiv, 10% on Kharkiv, and 8% on Dnipro. Products from the categories of food products, clothing and medicines dominated in the structure of export sales.

By the end of 2020, Ukrposhta became the largest logistics operator of international parcels (65% of the total number of parcels).

According to the authors of the study, the main obstacle to the development of e-commerce export is the non-recognition of Ukrainian certificates of conformity in the EU.

“The implementation of the Association Agreement by Ukraine and the mutual recognition of electronic signatures with the EU countries would have contributed to the integration of markets,” Partner and of Head of M&A at Aequo Hanna Babych said.

In addition, the entry of global e-commerce players into the Ukrainian market and the expansion of PayPal’s functionality could increase the potential of e-export, according to the study.


The volume of the e-commerce market in Ukraine in 2020 grew by 41% and reached $4 billion, which is 8.8% of the total retail trade, follows from a study by Soul Partners, Baker Tilly Ukraine and Aequo with the support of USAID.
According to the study, the Ukrainian e-commerce market has tripled in the past five years and has the potential to double in the next five years.
According to the material, the share of e-commerce in Ukraine’s GDP is 2.6%. At the same time, Ukraine has a low level of spending on e-commerce per year in comparison with other countries – about $104, which is explained by the low purchasing power of the population.
The most developed sectors of e-commerce in Ukraine are electronics and clothing, but every year the share of electronics is decreasing due to the growth of other categories, the study notes.
Thus, the volume of e-commerce in clothing over 2020 amounted to $291 million, the share of online sales in the structure of retail trade in clothing was 6.8%. According to the forecast, this figure will reach 10% by 2023. The most visited online clothing stores in 2020 were Shafa (105.1 million visits), Klubok (35.1 million) and Kloomba (34.9%).
According to the research, food has become a relatively new category with a significant growth potential in the Ukrainian e-commerce market, which also includes ready-to-eat food delivery services. Thus, the volume of e-commerce in products last year amounted to UAH 150 million.
The volume of e-commerce of furniture in Ukraine last year amounted to $69 million and occupied 9.2% in the structure of retail trade. This category of trade is forecast to grow 1.7 times over the next three years. The most visited online stores last year were Jysk (18.2 million), Taburetka (8.6 million) and MebelOk (6.7 million).
Most of the purchases on the Internet are made by Ukrainians on marketplaces (63%), the rest – in specialized online stores. The largest marketplaces in Ukraine are Rozetka, Prom, Allo, Bigl and Epicentr.



The strengthening of e-commerce under quarantine conditions will stimulate the demand for warehouse space within the city in 2020, according to a study by CBRE Ukraine (Kyiv), an international consulting company. “As in the past ten years, e-commerce will again become a catalyst for demand and will lead to shifts and changes in the warehouse real estate market in the next cycle. E-commerce will stimulate demand for the format of so-called warehouses within the city (incity warehouses, urban warehouses). In 2020, transactions may be signed for the acquisition of former industrial facilities in the city for conversion into storage facilities,” CBRE said.
At the same time, the worsening of the economic situation could facilitate the acquisition by the market players of land plots for the development of built-to-suit projects at reduced prices. However, the launch of new projects may be suspended due to the limited work of government agencies and delays in processing permits.
“A large number of representatives of industrial real estate took a wait-and-see position, which most likely means a reduction in rental activity and vacancy in 2020. However, the likelihood of negative absorption in the industrial market is minimal. Warehouse services are currently in a great demand, more than ever before, which will allow most of logistics and warehouse services operators to stay ‘afloat’ throughout the crisis period,” CBRE predicts.
According to the consulting company, pharmaceutical distribution, food retail and its logistics are experiencing a peak in sales under quarantine conditions in the amount of 40-50% higher than in the New Year season.


The Swedish company IKEA, the world’s largest retailer of furniture and household goods, has updated its plan to enter the Ukrainian market, deciding to launch e-commerce first. “In order to make the range of IKEA functional products with attractive designs and prices affordable for as many people in Ukraine as possible, the company decided to launch e-commerce first. The expected launch date is spring 2020,” the company said. At the same time, they confirmed their intention to open a store in Kyiv.
“IKEA confirms its commitment to Ukraine and plans to open the first store in Kyiv as soon as possible after the launch of e-commerce,” the company said.
As reported, in the summer of 2019 IKEA announced the launch of an official website for Ukrainian consumers and the recruitment of staff to work in the first urban-format store in Kyiv (about 100 employees). The opening of the store was scheduled for the end of 2019.
In September 2018, IKEA officially announced the opening of the first city store in Ukraine in 2019. The facility was supposed to be opened in the Ocean Mall trade center in Kyiv. However, the retailer later said that due to the delay in building the shopping center, the company is considering alternative ways to start business in Ukraine.
The network in Ukraine is developed by IKEA Southeast Europe, which is part of IKEA Group (Ingka Holding B.V.). The company is engaged in the retail business of IKEA in Croatia, Serbia, Romania, and Slovenia.

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Ukraine should improve logistic infrastructure, coverage with Internet and electronic payments for developing e-commerce, the founder of Alibaba Group Jack Ma has said.
“Three things that Ukraine should develop: Internet infrastructure, logistics and electronic payments. And also entrepreneurship. If these four components are ready, Ukraine will have huge potential on the Internet,” Ma said during the Kyiv International Economic Forum on Friday.
Ma said that he was disappointed to learn that it takes from four to seven days for the delivery of goods from China to Ukraine.
“These are indicators of the last century. They need to be improved,” he said.

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