Ivan Khokhlov, who co-founded 12Storeez, a clothing brand that grew from a showroom in his apartment in Yekaterinburg to a large company with 1,000 employees and 46 stores, faces the problem firsthand.
“With each new wave of sanctions, it becomes more difficult to produce our product on time,” Khokhlov said. The company’s bank account in Europe was still blocked due to sanctions shortly following the invasion, while logistical disruptions forced it to raise prices.
“We are facing delays, disruptions and price increases,” he said. “As the logistics with Europe are destroyed, we rely more on China, which also has its own difficulties.”
Hundreds of foreign companies have already scaled back or pulled out of Russia altogether, according to an accounting kept by the Yale School of Management. And the corporate exodus continued this week with McDonald’s. The company said following three decades it plans to sell its business, which includes 850 restaurants and franchises and employs 62,000 people in Russia.
“I passed the very first McDonald’s which opened in Russia in the 90s,” said Artem Komolyatov, a 31-year-old technician in Moscow, recently. “Now it’s completely empty. Lonely. The sign is still hanging. But inside, everything is blocked. It’s completely dead.
Nearby, two police officers wearing bulletproof vests and automatic rifles stood guard, he said, ready to fend off protesters.
At Leningradsky station, in one of the few franchises that remained open on Monday, customers lined up for more than an hour for a final tasting of McDonald’s burgers and fries.