"The process of import substitution of milk and dairy products is completed in Moscow. Today, 90% of domestic production is supplied to the markets," the mayor of the city Sergey Sobyanin stated. The Moscow authorities are betting on the 'Lianozovsky Dairy Plant', a division of the 'Wimm-Bill-Dann' company. However, as the Managing Director of the retail network ‘Podvorye’, the Moscow representative of the Joint Agricultural Complex ‘Milk’, Anna Nechay, believes, manufacturers of high-quality products are in a vice: "on the one hand, the market has opened, and this is very good for domestic producers, on the other hand, it is a paradoxical situation, where the manufacturers actually cannot do anything for several reasons."
Moment number one: the development of agriculture requires investment. Agriculture cannot be funded with short money, because agricultural investments can only be returned in 10, 15, 20 years.
Secondly, it takes 4-5 years to grow a productive dairy herd. According to Nechay, it takes at least a year to build a good quality plant, if the building is made quickly, but there is a principle of Russian construction, which is probably known to everyone: you can stop the construction, but it is almost impossible to finish it.
To return the investments in agriculture, the manufacturer needs to quickly sell perishable products. "This is milk with a shelf life of 3 days, sour cream with a shelf life of 7 days, 5-day kefir. That means, you know, that such products are not suitable for the program of storage of residues. We cannot once a month engage in a full trading network. These products need to be delivered on a daily basis, and the demand of a network is an organization of delivery of products on its own. Small enterprises cannot do it on a daily basis," Nechay says.
In addition, according to her, trading networks require bonuses from sales: "The bonus is 10%. Tell me, please, how to get this bonus? Due to buyers! It is immediately put into the price, once the cost of production increases, respectively, its price on the shelf increases."
The third point is the return of products. Now the plant has to buy unsold products back. Accordingly, the cost of such products on the shelf, the price of the product on the shelf, will increase by 30%. Imagine a price increase of 30% in the current economic conditions for the product manufacturer's retail? It is the murder, in fact, of the distribution of these products."
