Interest in consignment stores, second-hand shops and repair services for household appliances is growing all over Russia. As the cost-of-living soars, more and more consumers are refraining from buying new products, such as clothes and shoes, and turning to cheaper used alternatives instead. In times of economic instability, young Russians in particular are spending less on travel, entertainment and luxury goods.
Last year, the inflation rate in Russia rose to 9.52%, significantly higher than the central bank’s forecast of a maximum of 8.5%. The authorities’ attempts to curb the rise in prices, which included an increase in the key interest rate, had little effect.
Reminiscent of the Soviet era
Russian economist Igor Lipsits believes that the actual annual inflation rate is more than seven times higher than the official rate. He explained that the Russian economy is increasingly similar to that of the former Soviet Union, which was geared toward military needs. During the Soviet era, considerable funds went to the arms industry, with social issues taking a back seat. The experts pointed out that, given the economic instability in the country, those who repaired products or sold used goods could live more comfortably.
Andrei Fedotovsky, chairman of the Russian association of commission shops and owner of the Komilfo boutique chain for second-hand designer and brand-name clothes, said the demand for used luxury goods was also on the rise. He added that the trend had already emerged before the “difficult economic times” had begun, but it had seen a sharp rise following sanctions and the withdrawal of Western brands from the Russian market after Russia’s full-scale invasion of Ukraine. He added that the owners of expensive wares wanted to recoup some money by selling them, while buyers were happy to find good deals.
Price of luxury goods rising on the gray market
Fedotovsky also said that, although the prices in second-hand stores had risen by to 9%, in line with the official inflation rate, this was nothing compared to the inflated prices for designer goods coming into Russia via the gray market — that is, through unauthorized dealers.
“However, the trend toward reselling clothes is also part of a global development toward more environmentally-conscious consumption,” he said, adding that even wealthy Russians were switching to a circular economy because of the economic crisis, preferring to buy used goods over new.
He also noted that demand for second-hand luxury goods had risen in regions where those working in the arms industry, for example, were earning more. “Monthly salaries have risen to between 200,000 and 300,000 rubles (€ 2,073 and €3,110, $2,177 and $3,265),” he said.
More demand for appliance repairs
As the price of new, particularly imported, household appliances, is also rising, many Russians are looking to have their old ones repaired. This has led to an increase in repair services, which is reducing waste and the resulting negative impact on the environment.
One of the beneficiaries of this trend is Avito, an online marketplace that was originally created to facilitate the exchange of goods between private individuals. With a turnover of 1.9 trillion rubles in 2023, it is now one of the most important online retailers in Russia.
The number of advertisements for the repair of household appliances on Avito rose by 45% in 2022 and by 64% in 2023. The Russian business daily Vedomosti said that demand for washing machine and dryer repairs had risen by 181%, but there was a 30% fall in interest for computer repairs. This was attributed to difficulties importing the necessary parts due to Western sanctions.
Growing environmental awareness?
Russian environmental organizations have also observed a growing interest in second-hand goods. Representatives of the Russian ecological movement Razdelni Sbor told DW that the economic crisis was changing consumer habits, and this was a chance for people to become more conscious of the environment.
Irina Shazminova from theRazdelni Sbor movement added that more than 78% of textiles that ended up in the garbage in Russia were still suitable for reuse or recycling. “Around 20% of families in Russia cannot afford new clothes, and hundreds of kilograms of clothing are thrown away every day in large cities,” she said. She added that she had noticed a slight increase in the number of visitors to charity clothes swaps.
But Anna Garkusha from the same movement said that the economic crisis was having a negative impact on the waste management industry. She explained that many of the companies that processed secondary raw materials were struggling to repair necessary equipment because of the sanctions. She added that some waste collection points had had to close because of financial problems and the lack of state support. “The rent for one such site in St Petersburg was raised so much that it ended up in the red,” she said.
For her, people’s economic problems are dampening their interest in the environment. “Recycling can cost more than making a new product, ultimately making something more expensive,” Garkusha said, speculating that the rise in demand for second-hand clothes and appliance repairs was down to economics more than a growing awareness of green issues.
This article was originally written in Russian.
