In response to Russia’s invasion of Ukraine, several American companies removed themselves entirely from Russia, prompting Russia to rebrand old franchise locations.
Key Details
- Companies like McDonald’s and Starbucks completely retreated from Russia as a protest against the nation’s invasion.
- As the companies left, Russian business owners purchased old assets and rebranded the businesses—often under a similar name and selling similar products.
- For example, Starbucks is now Stars Coffee, Pizza Hut is Pizza N, Sprite is Street, Fanta is Fancy, Coca-Cola is CoolaCola, and McDonald’s is “Vkusno & tochka,” which translates to Tasty And That’s It.
- Many of the rebranded businesses also bear logos that resemble the original Western company, according to the Substack siteYello.
Why it’s news
These off-brand versions of Western companies are a visual representation of the sanctions imposed on Russia. Western sanctions have frozen nearly $300 billion of Russian Central Bank assets, according to the U.S. State Department.
Though dozens of Western countries have enacted thousands of sanctions against Russia, these sanctions haven’t been as effective as many initially hoped. Russia can still trade freely with China, lessening the severity of Western sanctions. Additionally, more than 500 non-Russian companies remain operating in Russia, according to a Yale report.
Major Western bands leaving Russia don’t just symbolize the current sanctions, but it also points to consumer bands’ role in international diplomacy.
During Mikhail Gorbachev’s rule of the Soviet Union, American brands McDonald’s and Pizza Hut set up shop in Moscow, giving the citizens a glimpse at Western culture. More American franchises began to pop up in Russia after that, but as diplomacy and connection with Russia begin to fade, American companies are disappearing. Russian knock-offs of Western brands are growing rapidly as they snatch up former franchise locations left behind by retreating Western countries. CoolCola producer Ochakovo plans to more than double its bottling capacity. Tasty and That’s It made a deal last year to acquire 25 former McDonald’s locations in Belarus, Reuters reports.