Amin Alkhatib is a home care analyst at Euromonitor
International. He monitors key industry trends and is-
sues and writes comment pieces, reports and analysis
for Euromonitor, which provide detailed insight into key
drivers, trends and the state of the industry.
DOES AN IRON CURTAIN
SURROUND HOME CARE?
AFEW MONTHS ago, the Russian Federal Service for Surveillance on Consumer Rights Protection
and Human Wellbeing (Rospotrebnadzor)
ordered Russian retailers to remove 12
home and personal care SKUs from their
shelves, including Henkel’s Persil and
Procter & Gamble’s Tide/Ariel as well as
products from five other home or personal care manufacturers.
This move by Russia’s consumer market regulator would, on the face of it, appear to represent another round of bans
echoing similar moves that have affected
other industries since March 2014.
Much of the international media furor suggested this was indeed the case—
a continuation of the “sanction wars”
that ensued following 2014’s economic
embargo. Russia’s initial bans were exclusively targeted at imports of perishable foodstuffs from the EU and the US
as a reaction to the economic embargo
imposed on the country.
While the media cried out “
sanctions,” this was a misrepresentation of
the underlying issue. The regulator had,
in fact, only obliged retailers to remove
a narrow range of products ( 12 SKUs)
due to safety concerns over toxicity levels. The reaction by the market following
the regulator’s removal order set in motion a chain of events unfavorable to the
According to the APCoHM (Russian
Association of Perfumery, Cosmetics,
Household Chemistry and Hygienic
Goods Manufacturers), the vagueness
in the regulator’s statement behind the
removal of the 12 SKUs caused concern
among retailers. Russian retailers were
concerned that the ban could be extended
to a wider portfolio, so they took the cautionary step of halting the purchase and
stocking of brands manufactured by the
seven cited companies.
That was the case with Henkel’s
Vernel, which took a hit as retailers in-
dependently decided to remove it from
their shelves, despite it not being a brand
listed by Rospotrebnadzor among the
three Henkel SKUs that were included.
Why a Ban Is Unlikely
Conditions in the Russian home care
market are vastly different to those in
the food import market for a number of
reasons. The Russian government’s imposition of a ban on home care goods
does not make sense; firstly, because the
two biggest companies that are affected
by the product ban, although multinational, mostly manufacture their products domestically.
In fact, Henkel Russia announced
earlier this year that it had opened its
ninth production facility in Russia, thus
a ban in this market would be a great-
ly felt disruptive action, and one that
would be blamed on the government.
Secondly, if the restrictions on the
respective home care SKUs were due
to safety concerns over toxicity, the
Will Russians say “nyet” to domestic household cleaners?