Most US companies stayed in Russia

In 2022 The US government and those of the other members of the G7 imposed sanctions on Russia since then they have increased the number of them 14 times and they amount to around 20 thousand people,companies and entities across all of Russia and in all sorts of sectors.They also urged their companies to leave Russia and stop doing business in the country.
There were thousands of foreign companies doing business in Russia employing hundreds of thousands of people in every convceiable area of business and commerce from retail to finance,engineering and manufacturing. So what is the situation today?

Well hundreds of foreign companies made the decision to leave Russia since February 2022. However many of them lchanged their minds and ater decided to stay: having to encountered many difficulties including trying to sell their assets and the prospect of losing huge amounts of money. That said more than half of American companies, for example, did not move anywhere. A number of Europeans decided to leave, while the majority of US decided to stay and continue to make large profits despite the sanctions and the "toxic" Russian market.

In total, there were at least 659 US companies operating in a variety of sectors were present in Russia by February 2022. Most of them were involved in IT and telecommunications - 143, industry - 129, food and consumer goods - 104, entertainment, sports and tourism - 68, and various "support" services - 51.

Thus, 310 organisations, or 44% of the total, have left the Russian market altogether or have stopped working with Russian companies. Plus 159 organisations continue to work in Russia in the same mode, another 178 are working, but have made some changes. What they did was changes in the way they work meaning some suspened new investments, cut back on thei marketing activities. Also in addition, some companies have switched to delivering their goods through distributors or have changed their brand names.

Among the companies that continue to operate as before, most are industrial (52 ), food and consumer goods (25), IT (21), pharmaceutical (18) and entertainment (10). Among the organisations that continued to operate with some changes, a significant proportion were in the IT and telecoms sector (44), consumer goods (40), industrial and financial sectors. ( 15)
In Russia, for example, household goods manufacturers including Procter & Gamble, Colgate-Palmolive, Johnson & Johnson, PepsiCo, Mars and Coca-Cola continue to operate. as normal There are also Burger King, TGI Fridays and Papa John's outlets. Clothing such brands Guess and Crocs (Saboo chain), Vans (switched to wholesale deliveries to the Russian Federation) remain.

Now some of the the companies explained their intentions to stay in different ways. The most advantageous position was the "humantarian. ( yeah right, they felt that depriving the Russian consumer of wrigleys spearmint chewing gum or mars bars was barbaric and inhumane)
"There are still more than 350 large American companies operating in Russia. Now the fast moving consumer goods sector (The FMCG) sector is particularly well represented and remains one of the most profitable.
In 2023 alone,the large American companies paid almost $1 billion in profit taxes to the Russian budget.
Now what distinguishes most of the remaining FMCG companies is their mission statement of 'providing essential goods to the Russian people'," Yes you heard that correct Uncle Bens Rice and Coca Cola are life sustaining essentials.

But the real reasons are tpretty obvious why would you want to sell your highly profitable business that you have spent years building for next to nothing because some politicians have a disagreement with the actions of the Russian government and then have pay 'compensation' to Moscow, plus you of lose brand and market share, long-term contracts with Russian partners and, finally, amount of profit that the business makes.
Plus many US companies operating in Russia see the blatant hypocrisy if the US governement which is urging them to leave Russia while they are still doing business with Russia and spending billions of dollars on for example Russian enriched uranium on which the US is dependent on for 35% of its supplies to keep the lights on and on Russian fertilisers for the agricultural sector
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The bottom line is that In 2023 for example PepsiCo's sales in Russia amounted to $2.8 billion, Coca-Cola HBC (which continues to operate through local subsidiaries) - $1.5 billion, Procter & Gamble - $1.2 billion. Philip Morris International - $1bn. Confectionary maker Mondelez International - $900 million.
Johnson & Johnson, which continues to supply medical devices and pharmaceuticals, had revenues of $800 million in 2023. General Electric, which remains in the energy sector, earned $700 million. Industrial and consumer goods company 3M - 600 million. Turnover of the agro-industrial company Cargill - 500 million. Pfizer (which continues to supply medicines) - 400 million.

"The figures for this top ten are astonishing. For many companies, leaving the Russian market would mean a significant loss of revenue. Moreover, some prefer to maintain a presence in different markets in order to diversify risks and remain globally competitive. Leaving could be perceived as a concession to political pressure, which could negatively affect the company's reputation among other international partners in other sales markets," Plus the fact that through 'parralel imports all that the company produces could be bought in neignbouring countries like Kazakhstan,Turkey or other countries and shipped to Russia so its a bit pointless to do this.

As a result, many American "Major Players" continue to work in Russia, now the US has put every possible pressure on European companies to leave Russia. And they have in many ways they have succeeded. For example, in 2022 alone, almost all European car brands left, which did not end well for them - their place was immediately taken by the Chinese which now dominate the market and from what I can gather anecdotially they produce a good product at a reasobnable price for the Russian consuner.
Of course, given the policies of transnational corporations, sanctions pressure on Russia can be seen as part of a broader strategy to squeeze European and Japanese companies out of the Russian market. The total losses of the Western car industry are enormous. The Renault group alone lost 2.3 billion in 2022 when it pulled out.Volkswagen Porsche had its VW and Skoda brands in the top 10 selling cars in Russia so its losses must be considerable.

What is more, European companies have left a loophole for themselves to return - some have made deals with the local mamnagement which gives them the opportunity to buy the business back at a previously agree price once the situation moves back to normal which it is bound to do.
Others, as the Financial Times recently wrote, have abandoned plans to leave Russia altogether as they feel that all the early pressure has gone and they can just wait it out.
Also Moscow's regulatory measures have also worked out by making actually leaving extremely difficult with measure that include a the imposition of mandatory 50% discount on the value of the assets from countries that are percieved as unfriendly countries when sold to Russian buyers.
Plus there also an "exit tax" of at least 15% and the difficulty of then getting the money out of Russia.
The most interesting part, say observers, will begin when Western companies that have left the market decide to ask to return. Possible sectors for a return, as highlighted by experts, are first and foremost consumer goods, pharmaceuticals and healthcare, technology and innovation.

As for American companies, their return will be made possible by the US elections as it is expected that when Trump wins the presidency some sanctions will be eased and players will return to Russia, Even now, after more than two years of anti-Russian sanctions, both American and European companies are openly or secretly returning to the Russian market.

"The behaviour of American companies is telling, as they follow the market leaders in accordance with the recommendations of American textbooks on strategic management and strategic analysis. Just as Coca-Cola has applied for re-registration of its trademarks in Russia, many American companies are doing the same because they do not want to lose the Russian market," notes Svetlana Sazanova, associate professor at the Department of Institutional Economics at the State University of Management.
"The place of those who have left is being successfully taken by Russian manufacturers and companies from friendly countries, for example the BRICS members. Large companies have more opportunities to evade sanctions, while small ones will lose the market, which means that sanctions are actually used as a strategic management tool: large companies can expand their presence in the market and squeeze out competitors," the economist points out.

However, more careful and selective control will now be required for any company that is looking to rethrn to Russia: first of all, the Russian governemnt will be assessing whether any companies coming back could harm harm domestic companies. However Western companies are unlikely to get a second historical chance to occupy all the niches in Russia.
Now what about those who have left and what has happened to their market share?
Well Ikea has been replaced by