[Analysis] What is behind Mere’s comeback as MyPrice?

Svetofor, Mere, MyPrice: three names, one concept. Two discreet brothers are building a European ‘superdiscounter’ with varying degrees of success from the depths of Siberia. What is their modus operandi, and why the secrecy?

Russian parent company

“MyPrice is the largest chain in the ‘discounter’ format on the market of Eastern Europe. We operate in more than ten European countries”. This is how the hitherto completely unknown food retailer presents itself on its own website. The chain recently opened its first three shops in Belgium (in Boom, Boussu and Opwijk) and also announced expansion elsewhere: eight or nine supermarkets in the German state of North Rhine-Westphalia, for example.

It is easy to explain why we never heard of this “MyPrice” before : it is simply the new name with which Mere hopes to finally succeed its European expansion after its inglorious retreat in 2022. In Eastern Europe, Mere has continued to build on the ‘old’ brand and is now a household name, active in many countries. Less well known to us is its Russian parent company, Svetofor.

Formula for success

Svetofor (Russian for “traffic light”) was founded in 2009 in the Siberian city of Krasnoyarsk, by discreet brothers Sergei and Andrei Schneider. Little is known about them: reportedly, they have never given an interview. Their business quickly became a formula for success: meanwhile, the chain is in the top five largest Russian food retailers, the independent Russian news website The Bell writes. Their 2022 sales exceeded 400 billion roubles (5.5 billion euros at the exchange rate of the time).

The store concept is simple: a changing range of unknown brands, displayed on pallets and in cold rooms in bare halls without any decoration. Prices are about a quarter lower than at other discount chains. The shops run on a limited workforce; the chain prefers low-cost locations outside cities. The retailer does not invest in marketing: anything to reduce costs – and therefore prices.

European expansion

International expansion followed, beginning in neighbouring countries: in Belarus, Svetofor already has nearly 200 shops, in Kazakhstan at least fifty, in Uzbekistan a handful. The company embarked on a European expansion in 2017: meanwhile, the chain has about 100 shops in countries such as Czechia, Lithuania, Romania, Serbia and Slovakia.

In the following years, Mere attempted made further expansion in Western European countries, opening stores in Austria, Belgium, France, Germany, Spain and the United Kingdom. However, it soon had to abandon those plans as the shops did not prove a commercial success. The war in Ukraine did not do the Russian image any favours and also caused supply problems. Banks no longer wanted to finance the company.

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The chain is now trying again under a different name, which indicates it attempts to cover up its Russian origins. Russian products the chain can no longer sell because of war sanctions, so the discounter now stocks mainly in Eastern European countries. For payments and financing, the chain is reportedly using crypto currencies more often.

Completely obscuring its Russian roots is difficult: Lightkommerz, the Belgian company behind Mere – and now MyPrice – was founded in October 2020 by one Dmitri Nesterov, a Moscow-based Russian citizen.

Supply chain distruption

So far, Mere/MyPrice’s operations have not been affected by European sanctions, but the question is to what extent shop owners, suppliers, banks and consumers in Western Europe will be willing to deal with an overtly Russian company, given the war in Ukraine, even though the brothers behind the company are reportedly not known as big Putin supporters.

Moreover, one can ask fundamental questions about the business model, which is at least partly based on the sale of surplus stock. However, in today’s economy (with its supply chains fiercely disrupted by various factors), there hardly is any surplus: scarcity is the new normal. This raises doubts about MyPrice’s potential…