The Analytical Center estimated the status of competitive environment on the Russian markets

From January 25 to February 22, 2017 the Analytical Centre of the Government of the Russian Federation in cooperation with the Chamber of Commerce and Industry of the Russian Federation carried out the online survey among representatives of Russian business, allowing to assess the overall state of competition and the competition environment on the Russian markets from the point of view of the entrepreneurs themselves. The poll attracted more than 1100 respondents.

According to estimates of representatives of Russian business, the State of competition on the Russian markets is moderate: 48% of survey participants indicated a high or very high competition level. The value of this indicator continues to decline from year to year: in 2016 51% of respondents indicated a high or very high competition level,  in 2015 — 53%. The share of those, who feels weak competition or its absence - has  increased . In 2017, it amounted to 25% against 24% in 2016 and to 21% in 2015.

36% of respondents consider the competition useful for business development, however, 21 percent of respondents did not note the positive impact of competition.

23% of surveyed businesses representatives noted reduction of competitors number, which is comparable with the results of a survey of 2016 — 24% (against 15% in 2015).

Reduction of the number of competitors can be explained by the presence of anti-competitive acts on the part of the authorities (this was indicated by 40% of respondents). 37% of respondents reported a negative impact on the number of competitors and changes in regulatory framework, 34% of respondents indicated withdrawal of Russian companies from the market as the cause of reduction of competitors’ number.  Barriers of access to financial resources (including the high cost of credit resources) remain key barriers for business activities. The significance of this barrier was indicated by 53% of respondents (56% in 2016). Obstacles to doing business are created by high taxes (which was indicated by 53% of respondents) and the instability of Russian legislation in respect of regulation of activities of enterprises (41%).

52% of respondents indicated that their business is constantly or occasionally experiencing anti-competitive pressure from the dominant market participant with a market share of at least 50% (vs. 45% a year earlier).

Russian business is planning an expansion of its activities: the proportion of those not planning to enter new markets in the next 3 years, accounted for 25% (compared to 27% in 2016).

Key obstacles to entering new geographic and product markets, as in 2016, the Russian business feels a lack of financial resources, the high up-front costs to business set up and the saturation of consumer markets.

With regard to enhancing the competitiveness of products, all economic activities are working in this direction. Costs reduction remain the most popular way: it was used by 68% of companies represented by the respondents. The second place is occupied by staff training — application of this method was indicated by 48 percent of the companies.

The most common way to increase competitiveness, in addition to cost reduction and personnel training for representatives from such areas as IT technologies, services (including financial) trading, is the use of new ways to promote products. Representatives of sectors of processing industry, as well as construction and agriculture purchased machines and technological equipment.

Key factors of the competitiveness of products, works and services, according to representatives of Russian business, are traditionally low price (41%), trusty relationships with customers (20%) and high quality (19%).

The survey report is available at: http://ac.gov.ru/files/publication/a/12824.pdf