Moscow, 1 February 2023 – X5 Group (“X5” or the “Company”, LSE and MOEX ticker: FIVE), a leading Russian food retailer that operates the Pyaterochka, Perekrestok and Chizhik retail chains, partnered with 1,174 new domestic suppliers in 2022, including 803 micro[1] and 243 small[2] enterprises. Overall, X5’s retail chains offered products from almost 5,200 suppliers at the end of 2022.
The largest number of new suppliers came from the Central Federal District, where X5 signed agreements with 534 new partners, including 24 sole proprietors, 102 small and 369 micro enterprises. In Moscow, the Moscow region and the Voronezh Region, the Company added 321, 109 and 14 new suppliers, respectively.
In the Northwestern Federal District, X5 partnered with 170 new suppliers, including 16 sole proprietors, 35 small and 112 micro enterprises, with most of them (102) based in Saint Petersburg. X5 also welcomed 23 new suppliers in the Kaliningrad Region and 18 in the Leningrad Region.
The Volga Federal District was ranked third by the number of new suppliers: in 2022, X5 started working with 156 companies in the area, including 33 sole proprietors, 36 small and 107 micro enterprises. The largest number of new suppliers in the district (26) were based in the Samara Region, with 23 in Bashkortostan, 20 in Tatarstan, and 17 each in the Republic of Mari El and the Nizhny Novgorod Region.
X5 partnered with 97 new suppliers in the Siberian Federal District, including 8 sole proprietors, 29 small and 53 micro enterprises. Suppliers were most active in the Altai Territory, with the retailer adding 22 companies to its supplier pool there. The Novosibirsk and Omsk Regions (18 new suppliers each) and the Krasnoyarsk Territory (17 new suppliers) were also among the top-3 Siberian regions in terms of new supplier partnerships.
The Southern Federal District provided 96 new partners for the retailer’s supplier pool, including 24 sole proprietors, 19 small and 66 micro enterprises. Most new suppliers from the district were based in the Krasnodar Territory (47), as well as the Rostov Region and the Volgograd Region (21 each). In the Urals, X5 added 78 new suppliers (35 from the Sverdlovsk Region, 23 from the Chelyabinsk Region and 8 from the Tyumen Region), including 27 sole proprietors, 14 small and 58 micro enterprises.
Another 23 partners were added in the North Caucasian Federal District (12 from the Stavropol Territory, four from Kabardino-Balkaria, and two each from Dagestan, North Ossetia and the Karachayevo-Circassian Republic), including five sole proprietors, four small and 17 micro enterprises.
In addition, X5 is actively expanding its cooperation with manufacturers from the Far Eastern Federal District and plans to open its first Pyaterochka stores there in the near future. In 2022, the Company stocked its shelves with products from 20 new suppliers based in the district, including one sole proprietor, four small and 12 micro enterprises. Nine of these suppliers are based in Khabarovsk Territory, eight in Primorye Territory, one in Buryatia and one in the Jewish Autonomous Region.
X5 seeks to stock its shelves with as many local products as possible in every region where it operates. In some regions, local producers account for up to 30% of sales at the Pyaterochka and Perekrestok retail chains. Overall, X5 gives about 90% of shelf space to domestic products.
The Company has focused on partnering with small and medium-sized businesses, bringing the overall share of SMEs in its supplier base to about 70% in 2022. To expand its pool of small suppliers, X5 opened 21 shop-in-shop Farmers’ Markets over the past year. In addition, X5 provides its partners with analytical tools through its digital platform for suppliers, Dialog.X5. These include a free tracker of key metrics across relevant categories for the supplier’s business.
In February, X5 will hold its first national conference for small business partners, called Small Business – Big Shelf!. Event participants will explore ways for small businesses to work with major retailers, as well as discuss measures to support small businesses with representatives of the public and private sector. The forum will also give suppliers the opportunity to showcase their products, while X5 Group will present a wide range of tools and options for promoting and marketing products via nation-wide retail chains.
[1] Enterprises with up to 15 employees and annual revenue of up to RUB 120 million.
[2] Enterprises with up to 100 employees and annual revenue of up to RUB 800 million.