The River Island stores close in Russia

World renowned brands Esprit and River Island can leave the Russian market at an early date.

The retreat of Maratex Fashion Retail, the franchise operator behind several international brands in Russia, put the country’s River Island and Esprit stores in question in 2014. It showed how exposed Western brands’ Russian presence was to the financial health of the local partners that ran it.

Maratex was majority-owned by Poland’s EM&F Group, which reported losses of around €1.6 billion at the end of 2013, driven by currency instability in Russia and Ukraine. In early 2014 the group announced it would wind down its clothing franchise operations.

Maratex ran a network of more than 60 stores across Russia’s largest cities, operating brands including OVS, Orsay and Peacocks, and ranked 25th among Russian fashion retailers by Euromonitor. With the parent withdrawing, market observers expected the company to be dissolved.

River Island was expected by industry insiders to continue in Russia independently. At the time it listed five Moscow stores, in Evropeisky, Metropolis, Okhotny Ryad, Mega Belaya Dacha and Mega Teply Stan, plus one in St Petersburg. The partnership with Maratex had begun in late 2010 with a first mono-brand store at Galereya in St Petersburg, and River Island had also operated in Ukraine since 2011, with two stores in Kiev.