The new Moscow outlet, which opened Tuesday, is located in the same building that housed the former Soviet Union’s biggest toy store, Detsky Mir, from 1957 until 2008. Detsky Mir became a household name, prompting the Soviet government to open a network of large stores by the same name. Now, the Detsky Mir chain of more than 320 locations is owned by billionaire Vladimir Evtushenkov.
The Hamleys opening comes at a time when the Russian economy is slowing amid falling prices for oil, the country’s main export, which compounded the effect of U.S. and European sanctions over President Vladimir Putin’s incursion in Ukraine. The market for children’s goods in Russia grew 3 percent last year to 502 billion rubles ($8.6 billion), according to researcher Synovate Comcon. The pace slowed from 11 percent a year earlier.
Hamleys isn’t afraid to expand against such a backdrop.
“Crises come and go, while we are making a long-term project,” entrepreneur Evgeny Butman, who runs Hamleys Russian franchise, said in an interview. “We run four smaller Hamleys stores in Russia and sales have been growing there, including in recent months. Hamleys is proving its resilience.”
Moscow is a unique megapolis that can be compared by population only to London and Paris among European cities, Butman said, justifying the logic for opening Europe’s largest toy store in the city. Despite the ruble’s devaluation, Moscow still has incomes comparable to Western Europe and remains under-penetrated by modern retail, he said.