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Why IKEA Is Fed Up with Russia

businessweek.com

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Re: Why IKEA Is Fed Up with Russia

#31

Post by ilyak »

presto10 wrote: post #29
ilyak wrote: post #12

Earlier quoted context omitted.

However, traditional Russian furniture is fine compared to Ikea's chinese crap. Crap's cheaper, tho. I know that on the basis of having some. As for retailers: if it wouldn't be an IKEA mall, it would be some other kind of mall, it's not like there would be much difference.

So when you can't win the actual argument, you will slander Ikea's products? Maybe I'm feeding the trolls here.

How would IKEA ever interest us outside of the context of its products?

"In other news, IKEA, after operating in Russia for 9 years, suddently discovers that there's a massive corruption there".

IKEA uses press to bash government for bad process; I use HN to bash IKEA for bad wares; If I troll, don't they?

Re: Why IKEA Is Fed Up with Russia

#32

Post by ilyak »

sho wrote: post #30
ilyak wrote: post #23

Earlier quoted context omitted.

Well, did the article provide any data on how much are they expected to bribe, in $, and how good their mall building is? No, instead we've seen some bashing. It's okay to bash, it's okay for me to troll. Face with it: IKEA drains money from the country (is that called investments) and also their offerings are crap. Maybe it's just my experience; Тёмочка praises them. However, my experience is that you should only go…

"Face it: IKEA drains money from the country" This is a common misconception and almost certainly wrong; you may need to brush up on your knowledge of economic theory if you harbour such fallacies. Perhaps start with comparative advantage: http://en.wikipedia.org/wiki/Comparative_advantage

The problem with comparative advantage is: For what products do Russia have comparative advantage? Besides oil, because being an Oil banana republic suck, and also all kinds of banana republics gravitate towards corruption and despoty.

If we'll find that we don't have comparative advantage over China in all manufacturing, we have two choices: - Ruin all the country manufacturing and hope for economical tooth fairy to save us - Fotrify economy against comparative advantage by introducing tariffs on imported goods.

It's noble and cool to think that every country have its own comparative advantages, but, some don't. In this case you either lose your manufacturing entirely, or defend it.

Re: Why IKEA Is Fed Up with Russia

#33

Post by Dauntless »

ilyak wrote: post #12
rjurney wrote: post #9

Earlier quoted context omitted.

Except - traditional Russian retailers are terrible compared to Ikea. They do represent a real improvement.

However, traditional Russian furniture is fine compared to Ikea's chinese crap. Crap's cheaper, tho. I know that on the basis of having some. As for retailers: if it wouldn't be an IKEA mall, it would be some other kind of mall, it's not like there would be much difference.

Well I'm sure that if Russian furniture is so fine and good value for the money, it will have no problems competing with Ikea on domestic or international market (and that is a big if). Or do you want in your absurd hatred of Ikea to ban it from the market, even though normal people like me for example would prefer it (I have several Ikea products that are just fine and are several years old). Anyhow, I don't see what you are arguing for, limiting the marketplace and imposing your will on what people actually what? First you argue for suck up to corruption or leave, now this... I admit, it's very tempting for me to give now a quick generalization of your statements as a reason for current economic status of Russia, but I won't because that would be also stupid.

Re: Why IKEA Is Fed Up with Russia

#34

Post by ilyak »

presto10 wrote: post #28
ilyak wrote: post #25

Earlier quoted context omitted.

It does. But I don't think they deserve some special rights because of that or because of their size; that is, a right to use corruption (when trying to do something questionable) and blame corruption (when it gets in their way) at one time. As for improving the lifestyles, you'll soon realise that cheap chinese wares don't improve the lifestyles that much. Cheap, but ugly and non-durable.

Are you claiming that Ikea is using corruption (bribing someone) in Russia? On what grounds?

Because every big corporation uses corruption unless proven otherwise. Sorry.

Especially global corporations are known for doing it in less economically developed countries to own them as they wish. Example is South America: there were some wars, even, growing out of conflict between two American oil corporations.

Re: Why IKEA Is Fed Up with Russia

#35

Post by ilyak »

Dauntless wrote: post #33
ilyak wrote: post #12

Earlier quoted context omitted.

However, traditional Russian furniture is fine compared to Ikea's chinese crap. Crap's cheaper, tho. I know that on the basis of having some. As for retailers: if it wouldn't be an IKEA mall, it would be some other kind of mall, it's not like there would be much difference.

Well I'm sure that if Russian furniture is so fine and good value for the money, it will have no problems competing with Ikea on domestic or international market (and that is a big if). Or do you want in your absurd hatred of Ikea to ban it from the market, even though normal people like me for example would prefer it (I have several Ikea products that are just fine and are several years old). Anyhow, I don't see wha…

I argue that IKEA uses "free press" as a lever to get whatever it wants from government, for cheap. Then I say that if we don't like IKEA that much, we shouldn't buy into that.

Re: Why IKEA Is Fed Up with Russia

#36

Post by [deleted] »

froo wrote: post #20

I'd just like to take the time (and the modding down this comment will probably get) to thank HN, simply because this article has been posted for more than 4 hours and nobody has yet made an "in soviet russia" joke. Thank you all for the continuing maturity.

[deleted]

Re: Why IKEA Is Fed Up with Russia

#37

Post by sho »

ilyak wrote: post #32
sho wrote: post #30

Earlier quoted context omitted.

"Face it: IKEA drains money from the country" This is a common misconception and almost certainly wrong; you may need to brush up on your knowledge of economic theory if you harbour such fallacies. Perhaps start with comparative advantage: http://en.wikipedia.org/wiki/Comparative_advantage

The problem with comparative advantage is: For what products do Russia have comparative advantage? Besides oil, because being an Oil banana republic suck, and also all kinds of banana republics gravitate towards corruption and despoty. If we'll find that we don't have comparative advantage over China in all manufacturing, we have two choices: - Ruin all the country manufacturing and hope for economical tooth fairy to…

Give me a break. Russia has huge natural resources, a large aerospace and military industry, and a promising if undeveloped IT/maths/science sector. The possibilities and potential is endless.

There are plenty of things highly skilled Russians can and should be doing rather than making crappy, expensive furniture. But you know this, of course. This is what every other country does.

And there are plenty of other countries which earn the bulk of their foreign currency in commodity exports, mine included, and it's not a hotbed of corruption. In fact, minimising corruption can be a comparative advantage in itself.

"In this case you either lose your manufacturing entirely, or defend it."

Who would want to defend their furniture manufacturing capacity!? Yes there are strategic industries you can make a case to defend. But furniture? "Mr. President, we must not allow... a furniture gap!"

Anyway, if you're going to protectionist your way to the poor house, at least do it legitimately as part of a top level economic strategy. Local corruption is absolutely not the way to enforce a tariff.

Re: Why IKEA Is Fed Up with Russia

#38

Post by presto10 »

ilyak wrote: post #34
presto10 wrote: post #28

Earlier quoted context omitted.

Are you claiming that Ikea is using corruption (bribing someone) in Russia? On what grounds?

Because every big corporation uses corruption unless proven otherwise. Sorry. Especially global corporations are known for doing it in less economically developed countries to own them as they wish. Example is South America: there were some wars, even, growing out of conflict between two American oil corporations.

You as a Russian should know better than to generalize about others, in the same way Russians are being unfavorably generalized elsewhere. It just makes you look as bad as them.

Re: Why IKEA Is Fed Up with Russia

#39

Post by ilyak »

sho wrote: post #37
ilyak wrote: post #32

Earlier quoted context omitted.

The problem with comparative advantage is: For what products do Russia have comparative advantage? Besides oil, because being an Oil banana republic suck, and also all kinds of banana republics gravitate towards corruption and despoty. If we'll find that we don't have comparative advantage over China in all manufacturing, we have two choices: - Ruin all the country manufacturing and hope for economical tooth fairy to…

Give me a break. Russia has huge natural resources, a large aerospace and military industry, and a promising if undeveloped IT/maths/science sector. The possibilities and potential is endless. There are plenty of things highly skilled Russians can and should be doing rather than making crappy, expensive furniture. But you know this, of course. This is what every other country does. And there are plenty of other count…

Money aren't the problem when you sit on a sea of oil.

However: employing 140M people is a problem; distributing those money between regions is a problem; not turning into banana republic is a problem (already failed that one).

Those problems can be, to some extent, solved by having manufacturing intact and working, if slightly inefficient.

I'm not saying it's only about furniture. This question is probably orthogonal to the whole IKEA discussion. Sorry :)

Re: Why IKEA Is Fed Up with Russia

#40

Post by ilyak »

presto10 wrote: post #38
ilyak wrote: post #34

Earlier quoted context omitted.

Because every big corporation uses corruption unless proven otherwise. Sorry. Especially global corporations are known for doing it in less economically developed countries to own them as they wish. Example is South America: there were some wars, even, growing out of conflict between two American oil corporations.

You as a Russian should know better than to generalize about others, in the same way Russians are being unfavorably generalized elsewhere. It just makes you look as bad as them.

Well, doesn't it seem strange to you that they SUDDENTLY discovered that there's corruption. There's two branches: - It's really the first time they ran into corruption; it would be a cool fairy-tale, but neither I nor you beleive this. - They managed to get along before despite corruption. Which means that either corruption is not so much severe (they managed to open and operate successfully and profitably, on a large scale), or that they used that corruption (bribed).

Now you can say that there's good bribe and bad bribe (first for doing legal things, second for questionable), but it's bribery in either case.

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