KEY INSIGHTS

• Prada, Moncler, Hermès, LVMH, Kering, Richemont and Chanel have suspended operations in Russia, while Nike is also temporarily closing all stores in the country, after halting sales via its website and app last week.
• The LVMH Prize has pledged support to its three former semi-finalists from Ukraine, Anna October, Julie Paskal and Anton Belinskiy.
• Swatch Group is halting exports to Russia, but will keep its stores open.

Prada, Moncler Suspend Retail Operations in Russia

The luxury labels released statements over the weekend announcing their temporary suspension of retail operations in Russia, joining a growing list of fashion companies that have done the same, including Hermès and LVMH.

Moncler’s store in Moscow is closed as of Saturday, March 5, and its e-commerce services in the country have already been on pause. “In this moment of growing uncertainty and concern, we have decided to temporarily suspend our operations in Russia,” Moncler said in a statement to BoF. “We will continue to stay in close contact with our local teams and their families to ensure full support.”

Prada is also holding off operations in Russia as of March 5. “From today, the Prada Group suspends its retail operations in Russia,” the company said in a statement.

“Our primary concern is for all colleagues and their families affected by the tragedy in Ukraine, and we will continue to support them.”

Kering, Chanel, Inditex and Nike closed their stores in Russia as well.

— Cathaleen Chen

Hermès Temporarily Closes Russia Stores

French luxury group Hermès said on Friday it would temporarily close its stores in Russia and pause all commercial activities in the country, the first major international luxury group to publicly announce such a move.

“Deeply concerned by the situation in Europe at this time, it is with regret that we have taken the decision to temporarily close our stores in Russia and pause all our commercial activities from the evening of March 4th,” Hermès said in a post on its LinkedIn page. It gave no further details.

Hermès has three stores in Moscow.

Doing business in Russia has become complex following Russia’s invasion of Ukraine, which prompted the United States and Europe to impose sweeping sanctions.

While affluent Russians are keen consumers of luxury goods, analysts say the proportion of luxury sales generated from Russian nationals is small compared to the industry’s main growth engines, China and the United States.

According to estimates from Jefferies, Russians account for around $9 billion in annual luxury sales, around 6 percent of Chinese spending and 14 percent of American spending.

L’Oréal, LVMH and Kering have all pledged financial support to organisations assisting Ukrainian refugees.

Swiss watchmaker Swatch Group, which owns high end watches and jewellery labels including Harry Winston, said it would continue its operations in Russia but was putting exports on hold “because of the overall difficult situation.”

— Reuters; By Mimosa Spencer and Silvia Aloisi; editing by Tassilo Hummel, Jon Boyle and Susan Fenton.

LVMH to ‘Temporarily’ Close its 124 Shops in Russia

French luxury group LVMH will “temporarily” close its 124 stores in Russia from Sunday, a group spokesperson told Reuters on Friday.

The group, which has its headquarters in Paris, took the decision given “the current circumstances in the region,” the spokesperson said.

Doing business in Russia has become complex since Russia’s invasion of Ukraine, which prompted the United States, Britain and the Europe Union to impose sweeping sanctions.

The announcement follows similar moves earlier in the day by Birkin bag maker Hermes and Cartier owner Richemont, who were the first major global luxury firms to pause all commercial activities in the country.

The spokesperson added that the group’s 3,500 employees in Russia would continue to receive their salary and benefits.

— Reuters; Layli Foroudi and Mimosa Spencer; editing by Richard Lough and Bernard Orr

Richemont, Kering and Chanel Pause Business in Russia

Richemont, which owns brands including Van Cleef & Arpels, Montblanc and Dunhill said in a statement to Reuters it suspended commercial activities in Russia on Mar. 3. Kering is temporarily closing stores in Russia, due to “growing concerns regarding the current situation in Europe,” according to Reuters. Chanel announced it would no longer deliver into Russia, closed its boutiques and suspended e-commerce via a Linkedin post.

LVMH Prize Pledges Support for Former Semi-Finalists From Ukraine

The prestigious fashion award said Friday it will offer support to three former semi-finalists from the Ukraine.

Designers Anna October, Julie Paskal and Anton Belinskiy will receive financial and operational assistance from LVMH, according to a post on the LVMH Prize’s Instagram page.

Earlier this week, LVMH said it had donated €5 million ($5.56 million) to the International Committee of the Red Cross (ICRC), as well as launching a fundraising campaign for the committee.

— Sarah Kent

Swatch Group Halts Exports to Russia But Keeps Stores Open

Swatch Group AG is halting exports to Russia but will keep its stores open to continue selling Omega, Longines and Tissot watches to Russian customers.

“We have put exports to Russia on hold because of the overall difficult situation,” a company spokesman said in an emailed statement. The company’s fully owned Russian affiliate and Russian stores remain operational.

Luxury jewellery and watchmakers have continued to do business in Russia even as brands like Nike and Apple halt sales in response to the invasion of Ukraine. Some luxury brands including LVMH-owned Bulgari have seen a rise in Russian sales as people purchase watches and jewellery in a bid to preserve wealth as the value of the ruble has plummeted.

Swatch’s Russian export halt was first reported by WatchPro, a trade publication.

— Bloomberg; By Andy Hoffman

Nike to temporarily close all stores in Russia

Nike said on Thursday it would temporarily close all its stores in Russia, joining a slew of Western brands that have suspended their businesses in the country following Moscow’s invasion of Ukraine.

The U.S. sportswear maker had made merchandise purchases on its website and app unavailable in Russia earlier this week and directed its customers in the country to brick-and-mortar stores instead.

The latest decision covers both Nike-owned and -operated stores.

The company also said its foundation would be donating $1 million to the United Nations Children’s Fund and the International Rescue Committee to support relief efforts.

Earlier in the day, U.S. off-price chain TJX Cos Inc said it would sell its 25 percent stake in Russian low-cost apparel retailer Familia, with two of its executives also resigning from their director and observer positions.

— Reuters; By Praveen Paramasivam; Editing by Aditya Soni

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