The Foot Soldiers in Russia's Mobilization Economy

Entrepreneurs are getting creative about filling gaps created by sanctions

- Cristina Lindblad

For many young Russians, the barrage of sanctions that severed their country's ties with large swaths of the global economy was a good reason to leave.

For Viktoriya Shelanova, a 37-year-old social media manager in Moscow, it was an opportunity to start a business selling water sports apparel.

An exodus of foreign brands following Russia's invasion of Ukraine has resulted in shortages of goods in practically every sector. When Viktoriya's sister Julia, an avid wakeboarder, struggled to find a neoprene vest, the two set out to find a manufacturer in China, a country that has maintained friendlier relations with the Kremlin.

They identified a factory in Guangdong province that produces sports gear for several big US companies and sent a request for samples via WeChat, the Chinese messaging service. Less than two months later they received a delivery of 20 vests.

Once they've chosen the ones they like best, they plan to start ordering them in batches of 100 to sell in Moscow, and to the water sports parks that have sprung up in recent years as wakeboarding gained in popularity. "We think there will be huge demand, and there's no competition at the moment," Viktoriya says by phone from Moscow.

Many commentators have compared Russia's current economic isolation to that of the Soviet era. Yet it's more reminiscent of the 1990s, when the collapse of communism left gaping holes in supply chains, forcing consumers and entrepreneurs to find creative ways to fill them.

Avito, the Russian equivalent of Craigslist, is full of people offering to import foreign-brand apparel from abroad: Search for Gucci and you'll pull up 173,000 listings. New supply chains have emerged to bring in iPhones and other Western tech gear via former Soviet countries.

Franchise owners are coping with the exit of multinationals by selling products with similar packaging and logos but slightly different names.